Hope is on the horizon for renters in 2024 as rent increases look to be slowing down, but genuine relief is still a long way off.
The latest Domain Rental Report, released today, showed that rental increases across Australia have stalled. It showed that rents stopped increasing in the three months to December and was the first time prices had held steady in almost three years. Domain Chief of Research and Economics Nicola Powell said that was good news for renters at the start of the new year.
“While the strain on Australia’s rental market remains evident, there’s a glimmer of hope that conditions are easing and rental price growth is slowing,” she said.
“Nationally, potential tenants will find greater choice, consistent with the seasonal lift in vacant rentals that occurs at the end of the year as the rental market moves into the busy changeover period.”
It came as Australia heads into what is known as “changeover season”, the time when the highest number of people move house, and renters are encouraged to make the most of the higher availability. However despite more homes being available, Domain warned it could be the “most competitive changeover period ever witnessed in Australia”.
“The mismatch between low supply and rising demand remains an ongoing challenge for tenants. Australia’s housing supply shortfall has collided with rapid population growth, a strained construction sector and rising property prices,” the report said.
“These factors will continue to play out in 2024, but with new first-home buyer incentives in place, it will help transition some to being owners or fast-track others to a more affordable purchase.”
However despite the stalling rent increases, a long period of serious price increases, including a 14.6% rise across the whole of 2023, meant that it would take time for the market to balance out. On top of that, serious growth to the housing supply is needed, with Domain saying that Australia needs between 30,000 to 60,000 additional rentals for prices to settle.
They say that without new houses, competition will remain fierce and rents will stay high to reflect that.
