Rental properties below $400 now a challenge to find

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Australia has seen a significant decrease in rental properties available under $400 per week, says a new PropTrack Market report.

The report showed that the proportion of rental properties listed for less than $400 a week on dropped to 19.3% nationwide in September 2022. In March 2020 it was 41.8%.

In capital cities, rental listings under $400 a week only represented 16.4% of all listings. In particular, Melbourne, Adelaide and Brisbane have seen the most significant decline in cheaper listings. Each with an 18% average decrease in the number of $400 listings. 

In ACT, Hobart and Darwin, less than 10% of the property listings were under $400. 

“With the supply of rental properties continuing to tighten, the share of listings under $400 a week is expected to reduce even further over the next year,” PropTrack Market says.

Related: Rent rises beginning to ease as affordability constraints set in, says Corelogic

Why is rent increasing nationwide?

In the past year, we’ve seen significant changes in the property market, particularly in the home loan space. 

After several Reserve Bank cash rate hikes, landlords have begun increasing prices to keep up with investment loan costs. Toss the cost of living crisis into the mix and now many Aussies have begun experiencing rental stress

Earlier this year, ME Bank found that 67% of renters have felt some sort of rent stress– when a household pays more than 30% of its income in rent.

“Rental markets have tightened markedly across the majority of Australia and rents have risen significantly due to falling vacancies,” the ME Bank report says.

Investors backing out of rental property too?

CoreLogic’s latest Quarterly Rental Review had similar findings. It also highlights the decrease in investment property purchases. 

“One factor which has likely negatively impacted rental supply is the decline in investor purchasing activity between early 2017 and early 2020,” says CoreLogic research analyst Kaytlin Ezzy. 

“Additionally, CoreLogic recorded an increase in investor-owned housing stock being listed for sale through 2021 and into 2022.”

With more cash rate hikes looming, the rental market will likely see more price increases and supply issues well into next year.

If you’re tired of renting and want to get into property ownership, check out Mozo’s home loan guides to help you get started on your journey. If you’re ready to buy, compare home loans below.

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