Catch-22 of Aussie property rentals right now

By Evlin DuBose · · 2 min read
Fact Checked
Advertiser disclosure
People falling up and down arrows.

Renters, don’t worry! Your landlord may be increasing your rent to record highs, but good news: they’re also not investing in new properties because it’s too expensive, so you have nowhere cheaper to move to!

Rock, meet Hard Place. (Which you rent. Not own). 

So why are Australian renters facing a catch-22?

Australian rental market in 2023

Model stairs with up arrows.

Inflation has bitten a chunk out of everyone, whether you rent or own your home. Rising interest rates have clamped down on home loan holders by hiking their mortgage repayments. Landlords have passed along these added costs to their tenants, which according to CoreLogic, drove a record-breaking 10% spike in rents through 2022. 

But while rate hikes may drag down inflation and property price growth, they also undercut the housing supply for renters because fewer people can afford to invest or build. (Construction costs have also skyrocketed because of inflation). 

Altogether, this creates a catch-22 for Australian renters, according to Master Builders of Australia chief executive, Denita Wawn. They can struggle to afford their current rent, or try their chances in an expensive rental market with record-low vacancy rates.

RELATED: Average rent in Australia

Warn says we simply don’t have enough homes to meet current demand, and it’s hurting everyone.

“If we’re going to achieve economic growth in this country, we need to house people. Not only people in Australia now but those who we want to come to Australia to meet all of our current labour shortages. At the moment we can’t house them. We can’t even house the people that are here. So we’ve really got to resolve this housing crisis.”

According to the ABS, 31% of the Australian population rents their home .

Struggling to pay rent on your home? Here are some solutions

Open door atop model stairs with bisexual lighting.

While we can always hope and pray for rental reform (which is good for homeowners, too), practical problems deserve practical solutions. So if you’re struggling at the moment, here are some first steps you can take to save money on rent. 

Subscribe to Moneyzone for weekly news and insights. Weighing up the pros and cons of renting vs. home buying? Compare home loans with our comparison hub.

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can compare more home loans here.
Last updated 18 October 2024 Important disclosures and comparison rate warning*

Home loan comparisons on Mozo

Promoted

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.84 % p.a.
    Fixed 1 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

image of houses

Need help with your Home Loan?

Whether you're looking to purchase a new home or refinance your existing loan, our friends at Lendi can help! Lendi’s expert advice is completely free of charge.

Learn more

* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

Compare home loans