Where rents have risen most in our capitals over the past year

June 21, 2023

Low vacancy rates and strong demand for rentals has led to a surge in rent prices, with some suburbs seeing increases of over 30% in the past 12 months.

At a national level, vacancy rates are currently 1.42%. Though it is a slight improvement from the historical low of 1.31% in March, it continues to be extremely tough for renters, particularly those in capital cities.

While vacancy rates in regional areas have increased by 0.35ppt in the past 12 months, capital cities have experienced a decline of 0.4ppt meaning that competition for available rentals is worsening.

But what is causing vacancies to remain so low in our capitals?

Demand for rentals in our capital cities has grown strongly over the past two years. The number of potential renters per listing has increased by 40% since May 2021.

The shift away from remote back to hybrid working and face to face studying has led to the revival of CBDs.

This coupled with the return of migrants, who are more likely to live in inner-city areas, has contributed to strong competition in inner-city rental markets.

Median rents for Melbourne units grew by 38%, which was the most among all capital city suburbs in the past 12 months. Picture: Getty


From the supply side, many investors exited the market at the beginning of the pandemic.

While there has been a rebound from mid 2020, the investor share of new lending remains below the levels seen between 2010-2018, according to the ABS.

Construction of new homes has also plateaued with new dwelling approvals trending downwards in our three largest states since mid-2021 due to delays in the construction industry and interest rate increases.

These demand and supply factors have made it particularly hard for current and potential renters.

We can get a sense of how tight rental markets are, and where they’re most competitive, by looking at the metro suburbs with the largest annual growth in advertised rents for homes.

For houses, more than half of the top 10 are situated within 10kms of their respective CBDs.

Suburbs with the largest annual growth in advertised rents – House

Source: PropTrack. Only includes suburbs with >= 30 rentals from May’22-Apr’23 and May’21-Apr’22.


Rose Bay topped the list with a 38% increase in weekly rent over the past year while renters in Rosebery experienced increases of 29%.

In East Perth and New Farm, rents rose to $590 and $850 per week, respectively, which saw renters paying around 30% more than the year prior.

For units, inner city suburbs were also the most impacted by rent rises.

Suburb with the largest annual growth in advertised rents – Unit

Source: PropTrack. Only includes suburbs with >= 30 rentals from May’22-Apr’23 and May’21-Apr’22.


Melbourne, Aberfeldie and Southbank units were popular among renters with rents 38%, 33% and 32% higher than they were a year prior, respectively.

Median advertised rents in Haymarket and Zetland also saw considerable increases with renters now paying $930 and $850 respectively. This reflects an increase of 31-33% annually.

Throughout the pandemic, rents in these areas fell. The growth in the past year in part reflects their recovery but not entirely. Rents are now well above pre-pandemic levels and this is due to the tight market as well.

While market conditions have marginally improved for the regions, it remains exceptionally difficult for renters, particularly those residing or looking to reside in inner-city areas.

With demand high, and few options for improved supply in the short-term, vacancy rates are likely to remain low, and rents are likely to continue growing as a result.


Source: Realestate.com.au

You might be also interested in

Gettyimages 2006354243
Federal Budget 2024: $6.2b housing splash
The federal government has unveiled $6.2 billion in new housing spending in this year’s budget, with a major focus on housing for Aussies doing it tough. With near record low
Money 7864149cfb2
Federal Budget 2024: How this year’s budget tackles the rising cost of living
Tax cuts, energy bill relief and rent assistance are among the measures in this year’s federal budget aimed at bringing down the rising cost of living. Federal treasurer Jim Chalmers
Gettyimages 622528618
Is the mortgage loyalty tax a thing of the past?
New and existing home loan customers are now paying almost the same interest rates, with the difference shrinking to the smallest it’s been in the past five years. Since the
West Hoxton
Budget 2024: The roads, rail and regional hotspots getting billions
The 2024 federal budget has unveiled a range of initiatives aimed at tackling Australia’s housing issues head-on, but it’s also provided billions of dollars to build more infrastructure across the
Capi 1e0e766d2d5233a56cca5d4cd86b5710 09df85bc29deb103c8cadb5a2c2c7897
Cost of living: underinsurance effects 200,000 Aussies
Rising costs and affordability challenges has pushed Australia into an underinsurance crisis, which could cost homeowners hundreds of thousands of dollars when faced with disaster. In Australia, 13.1 million homeowners
Gettyimages 908296490 88041054c55
Biggest surprises of Australia’s rental market revealed
In some parts of Australia, rents are bafflingly high, while in others, they’re surprisingly affordable. In some cities, it’s the areas you’d least expect that are showing the highest rental
Higher for longer? The new cash rate paradigm
Research Director Tim Lawless unpacks what today’s cash rate decision means for the housing market. The interest rate outlook has changed remarkably in a short space of time. It was
Capi Eaca2a4a670f7182c240bbb3ada7028a Dde6cc44b571f6374cf0e9f8edab769b
Rent crisis: Vast majority of Victoria now home to ‘extreme rental pain’, but silver lining for Docklands
More than three-quarters of Victoria is now in extreme rental pain after the state notched the second-fastest rent rises in the country across the past year. But there are signs
Frankston 913595467e9
Why now is the time to invest in this unloved state, and where to buy
Victoria’s property investment prospects remain strong despite prices going backwards and an ‘outrageous cash grab’ by the state government that has prompted many investors to flee, according to property experts.
Gettyimages 1222002808
Are higher interest rates forcing investors to sell up?
More landlords in Melbourne and Sydney are selling off their investment properties compared to a year ago, new research suggests. PropTrack data shows the estimated share of home sales in

Get your Free Property Guide.

Here goes your text ... Select any part of your text to access the formatting toolbar.

Get your free Sales Report for Where rents have risen most in our capitals over the past year

Get your free Sales Report for Where rents have risen most in our capitals over the past year

Subscribe to hear the latest

Start The Conversation Today.

Call us on:

1300 850 730

Request a Callback:

Send us a Message:

Privacy Policy

Get your Free Property Guide

Get your free Suburb Report for Where rents have risen most in our capitals over the past year

Privacy Policy

Who we are

Suggested text: Our website address is: https://motionproperty.com.au.


Suggested text: When visitors leave comments on the site we collect the data shown in the comments form, and also the visitor’s IP address and browser user agent string to help spam detection.

An anonymized string created from your email address (also called a hash) may be provided to the Gravatar service to see if you are using it. The Gravatar service privacy policy is available here: https://automattic.com/privacy/. After approval of your comment, your profile picture is visible to the public in the context of your comment.


Suggested text: If you upload images to the website, you should avoid uploading images with embedded location data (EXIF GPS) included. Visitors to the website can download and extract any location data from images on the website.


Suggested text: If you leave a comment on our site you may opt-in to saving your name, email address and website in cookies. These are for your convenience so that you do not have to fill in your details again when you leave another comment. These cookies will last for one year.

If you visit our login page, we will set a temporary cookie to determine if your browser accepts cookies. This cookie contains no personal data and is discarded when you close your browser.

When you log in, we will also set up several cookies to save your login information and your screen display choices. Login cookies last for two days, and screen options cookies last for a year. If you select “Remember Me”, your login will persist for two weeks. If you log out of your account, the login cookies will be removed.

If you edit or publish an article, an additional cookie will be saved in your browser. This cookie includes no personal data and simply indicates the post ID of the article you just edited. It expires after 1 day.

Embedded content from other websites

Suggested text: Articles on this site may include embedded content (e.g. videos, images, articles, etc.). Embedded content from other websites behaves in the exact same way as if the visitor has visited the other website.

These websites may collect data about you, use cookies, embed additional third-party tracking, and monitor your interaction with that embedded content, including tracking your interaction with the embedded content if you have an account and are logged in to that website.

Who we share your data with

Suggested text: If you request a password reset, your IP address will be included in the reset email.

How long we retain your data

Suggested text: If you leave a comment, the comment and its metadata are retained indefinitely. This is so we can recognize and approve any follow-up comments automatically instead of holding them in a moderation queue.

For users that register on our website (if any), we also store the personal information they provide in their user profile. All users can see, edit, or delete their personal information at any time (except they cannot change their username). Website administrators can also see and edit that information.

What rights you have over your data

Suggested text: If you have an account on this site, or have left comments, you can request to receive an exported file of the personal data we hold about you, including any data you have provided to us. You can also request that we erase any personal data we hold about you. This does not include any data we are obliged to keep for administrative, legal, or security purposes.

Where your data is sent

Suggested text: Visitor comments may be checked through an automated spam detection service.

Get your Free PDF copy of Make Money Simple Again