Rental Growth Picks Up Pace

Rental growth has accelerated across Australia’s capital cities for the first time in more than two years.

The pace of rental growth had slowed in recent years after soaring during the pandemic, but Cotality data shows rents are now up 3.7% in the 12 months to July. This follows 16 consecutive months of falling or a stable pace of rental growth.

In metropolitan markets, the data shows that rents are rising faster in the smaller cities, with Darwin up 7.6%, Hobart, 5.6%, Perth, 5.1%, Brisbane, 4.6% and Adelaide, 4.4%.

Sydney rents are up by 2.4%, and Melbourne is up 1.1% in the past 12 months. Across regional Australia, rents are up 5.6%, with the highest increase in Regional Western Australia, which is up a massive 10.2%.

Cotality economist, Kaytlin Ezzy, says with both rents and construction costs trending higher, there could be a housing inflation rise in the coming months, which could lessen the chance of future rate cuts.