Finding an available rental property in some suburbs is virtually impossible at the moment, with extremely high demand and almost unprecedented low supply.
New data from PropTrack shows the areas around Australia at the forefront of the rental crisis, where would-be tenants face intense competition and sky high prices.
“We’re seeing low vacancy rates in almost all parts of the country,” PropTrack economist Angus Moore said.
“That means many suburbs are seeing strong demand for the few properties that are on the market. It’s very tight at the moment.”
How tight are the rental conditions in your area? Use the interactive below to find out.
Nationally, the rental vacancy rate sits at just 1%, according to SQM Research. In Sydney, it’s hovering at 1.6% while in Melbourne it’s 1.7%, and in Brisbane it’s an alarming 0.6%.
Each Saturday at open inspections across major cities, hordes of hopeful tenants are likely to be found queuing outside the scarce number of available properties.
Joy Bianchi, general manager at Ray White Glen Waverley in Melbourne, said those kinds of scenarios have caused tempers to fray.
“We had a situation on the weekend where one prospective renter abused our property manager at a property because they believed the price was ridiculous,” Ms Bianchi said.
“The prospective renter left the premises yelling at others not to view the property because the price was too high. People are stressed and frustrated.”
Right now, the number of rentals listed across Australia is 18% lower than in June last year – and a staggering 30% down on pre-pandemic levels.
“Part of why rental markets are so tight is we saw a lot of investors sell out through 2020 and 2021,” Mr Moore said.
“We can match rentals on realestate.com.au with their sales history and what we saw through the pandemic was that a lot of rental properties got sold.”
Finding a rental property at the moment is all but impossible in many suburbs. Picture: Getty
But the data analysis can go deeper than that.
The median number of potential tenants per listing indicates how high demand is in a particular suburb.
And if a national median provides something of a baseline, then suburbs with the biggest percentage of potential renters per available property above that could reveal the tightest markets in Australia.
Queensland is bursting at the seams
On that measure, five of the 10 most in-demand suburbs for rentals in Australia are in Queensland.
The Sunshine State gained an influx of new residents throughout the Covid pandemic, as people from Melbourne and Sydney sought refuge from lockdowns and tough restrictions.
According to data from the Australian Bureau of Statistics, 80,000 people moved there from other states and territories from the start of 2020 to the end of 2021.
“Queensland typically benefits from net migration from other states, but over the pandemic that migration has been even stronger than usual,” Mr Moore said.
As a result, in June there were only 2279 homes available for rent across the entire city, according to SQM Research.
The southeast Queensland rental market is particularly frenzied. Picture: Getty
Demand for rental properties remains strong across southeast Queensland, with the suburb of Wacol, southwest of Brisbane, ranking as the tightest area in the country.
In the 12 months to 30 June, there were 308% more potential renters per listing than is typical at a national level.
The relative affordability compared to other locations is likely a driver of that demand, with Wacol’s median weekly house rent just $375.
Blackstone, on the outskirts of the satellite city of Ipswich, ranked second most in-demand nationally with 258% more potential tenants per listing than typical.
Other in-demand Queensland suburbs included North Maclean in the Logan-Beaudesert area (247%), Brendale in the Moreton Bay region (147%), and Durack in Ipswich (134%).
And Tamborine in the booming Gold Coast region just scraped into the national top 10 list, with 204% more renters per available listing than the national median.
An influx of new residents in Queensland during COVID has supercharged property markets. Picture: Getty
Cheaper big city suburbs flooded
Two Melbourne suburbs made the national top 10 list, despite the Victorian capital having the highest vacancy rate of all the major cities – albeit still low.
Pearcedale, southeast of the city, has a semi-rural feel but is a stone’s throw from the water, a relatively easy commute to the CBD, and a quick drive to the heart of the Mornington Peninsula.
It was the fourth most in-demand rental location nationally, and Victoria’s number one suburb, with 238% more potential tenants per listing than the national median.
The outer eastern suburb of The Basin also appeared, with 220% more potential tenants per listing than the national median.
That sky high demand has seen the median weekly house rent jump 9% in the past 12 months to hit $445.
Surging demand and dwindling supply make being a renter in Sydney a tough prospect. Picture: Getty
Two suburbs in New South Wales made the national top 10 list, with Kareela in Sydney’s Sutherland Shire ranking seventh overall.
The prized waterfront pocket had 216% more potential tenants per listing than is typical, despite the hefty median weekly house rent of $850 having jumped 7.5% in the past year.
Windermere Park in the booming Newcastle region came in as the eighth most in-demand suburb in the country, with 213% more potential renters per available property than the national median.
Real Estate Institute of New South Wales chief executive officer Tim McKibbin said agents across the state have reported an “extreme shortage of rental stock”.
“Many tenants are staying put, despite rent increases, for fear they will not be able to secure another suitable property,” Mr McKibbin said.
“And more and more stock is exiting the rental market, as landlords sell up and homebuyers move in.”
With not enough properties in the rental pool to satisfy high tenant demand, he said the rental crisis is likely to continue for some time.
Smaller capitals are under just as much pressure
The inner-northern Adelaide suburb of Ridleyton appeared in ninth spot on the national list of the tightest rental markets, with 208% more potential renters per listing than is typical.
All of South Australia’s most in-demand markets are within the capital city itself, predominantly to the west and south of the CBD.
Among the state top 10 list are Hampstead Gardens (183%), Hove (151%), Glandore (158%), and Devon Park (154%).
The rental vacancy rate in the particularly hot Adelaide market has now collapsed to just 0.4%, with a tiny 750 available properties in June, according to SQM Research.
Advocacy and support group Shelter SA said tenants in the state faced a “nightmare” scenario as supply dwindles, demand remains high, and prices rise sharply.
“People who are long-term renters are resorting to living in tents, campervans, and their cars while vacancy rates remain low and rents soar,” it said in its latest bulletin.
“People who are locked out of the housing market are a rapidly growing demographic, adding to the already high number of people experiencing homelessness.”
A combination of factors, from investors selling up to new builds flatlining in recent years, have caused supply shortages. Picture: Getty
Meanwhile, Tasmania’s booming tourism market is being blamed for a shortage of long-term rentals, with countless homes in Hobart converted into short-stay accommodation.
A reprieve during the COVID-19 border closure was short-lived, advocates say, and the Rental Affordability Index released at the end of 2021 shows Greater Hobart is now as unaffordable as Melbourne.
“Over the past five years, the score for Hobart has decreased by over 5% per year, leaving it as the only capital city in Australia where rental affordability for the average household is below the critical threshold of 100,” the report said.
Hobart’s rental vacancy rate in June sat at just 0.6%, with only 186 properties available on the market that month.
Rose Bay was the city’s most in-demand rental market, with 93% more potential tenants per listing than the national median.
There are no immediate signs of relief for desperate renters. Picture: Getty
Housing affordability constraints in the notoriously-expensive Canberra market mean those on lower incomes are struggling to find a rental.
“ACT has the highest proportion of Commonwealth Rent Assistance recipients receiving the maximum rate, and the highest proportion of recipients experiencing rental stress at 55%,” ACT Council of Social Service deputy CEO Adam Poulter said.
“Alongside a chronic lack of affordable private rental properties, the ACT has a shortage of over 5500 social and affordable housing dwellings.”
Over in the west, data indicates renters are heading further out from the CBD, likely in search of more affordable rentals as the property market roars back to life post-Covid.
Koongamia in the city’s northeast was Western Australia’s most in-demand rental suburb, with 138% more potential tenants per listing than the national median.
Salter Point (78%), Hocking (72%), and Midvale (72%) were also sought-after.
And finally, in the Top End, tenants searching for a home in Darwin face intense competition with a rental vacancy rate in the city of just 0.5%.
In June, there were just 175 rental properties available in the Northern Territory capital.
According to the PropTrack data, Virginia in the city’s south was the most in-demand, with 89% more potential tenants per available listing, followed closely by Girraween (87%) and Jingili (82%).
What’s available isn’t lasting long, with rentals going very quickly when they’re launched on the site, Mr Moore said.
“The median time a property is listed before being rented on realestate.com.au is down to just three weeks nationally. It is even faster in Adelaide, Brisbane, and Hobart.
“That means renters have to make quick decisions when they find a property that works for them.”
Little relief in sight in the short-term
There are some signs of hope on the horizon for struggling renters, although it will take some time for an easing of current conditions.
“Investors are coming back and are now accounting for a bit over a third of all new housing lending, up from less than a quarter during the pandemic,” Mr Moore said.
“More investors will start to bring more supply to the rental market, which will help ease conditions, but it will be a slow process. New investor purchases are small relative to the overall stock of rentals.”
Property Council of Australia boss Ken Morrison said long-term solutions are needed to offer genuine support to those struggling with the cost of housing.
Mr Morrison said housing supply forecasts show supply is set to drop by around one-third over the next four years, creating a 163,400 dwelling deficit nationally by 2032.
“We are on the verge of a severe supply shortage just as migration will grow to pre-pandemic levels,” Mr Morrison said.
“This lack of supply is also evident in the rental market where a shortage of properties is already pushing rents up. We need creative approaches, such as enabling build-to-rent housing, to ease supply constraints.”
– Additional reporting by Emily Hutchinson