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A new report has found listings of affordable rental properties to have plummeted over the past year.
PropTrack’s latest Market Insight Report has discovered that surging rental costs are heavily contributing to reduced rates of affordable rental properties.
The property data company revealed that the national share of rental properties listed for less than $400 per week has declined to a record low of only 10.4 per cent, a third lower than the levels observed in April 2023.
In explaining the causes behind these skyrocketing rental rises, PropTrack identified near record-low vacancy rates, strong demand and limited new supply as creating “exceptionally challenging conditions for renters”.
The rapid deterioration of rental affordability has been particularly pronounced across the larger capital cities, with PropTrack detailing that compared to the start of the pandemic, the one in five house rentals that cost less than $400 a week within the Sydney market now registers as one in 50 houses.
Across the combined capital cities, just 5.9 per cent of rental properties are priced below $400 per week.
Affordability within Melbourne’s rental property market was also found to have decreased, with just one in 25 house rentals costing less than $400.
Moreover, Melbourne was found to have incurred the largest annual decline in the share of houses listed for less than $400 a week, with Adelaide and Sydney seeing the second and third most severe reductions in affordable rental listings respectively.
Across the states and territories, the ACT registered the smallest portion of properties listed for rent under $400, at 2.1 per cent of rental properties.
Sydney and Perth markets were found to have similarly scarce supply with just 3.8 per cent and 5.6 per cent of rental properties affordable in the respective cities.
When it came to regional Australia, the lowest portion of affordable rental properties was found in regional Western Australia, where just 14.8 per cent of rentals were priced below $400.
Regional Queensland followed with an affordability rate of 15.8 per cent, while 21.5 per cent of rental properties in regional NSW cost under $400 per week.
These findings were described by the company as being “particularly problematic for lower income households for whom almost no rental properties are affordable”, and this shortage being further indicative of the “critical need” for an increase in housing supply.
Even with this present dearth of rental properties brought on by an imbalance between rental demand and supply, PropTrack cautioned that “without any meaningful action to improve rental supply, we can expect to see this trend remain and price increases endure”.
