CoreLogic’s Quarterly Rental Review reveals that Australia’s rental crisis continues to worsen, with vacancy rates hitting a fresh record low and annual rental growth soaring to all-time highs.
CoreLogic notes that the rapid return of net overseas migration (NOM) is exacerbating rental pressures:
The annual trend in national rents recorded double digit growth over the 12 months to August, for the first time since CoreLogic records commenced, with the annual trend holding steady at 10.0% over the year to September.
The past few years has seen unprecedented growth in rental values…
Initially driven by a reduction in the average household size, the continued upswing in values is likely now predominantly being driven by the strong return of overseas migration, coupled with extremely tight rental supply…
Supply continues to be an important factor impacting rental markets with the total supply of advertised rental stock -35.4% below the previous five-year average over the four weeks to 2nd October. Additionally, national dwelling vacancy rates tightened from 1.3% in June to 1.1% in September, the lowest national vacancy rate on record…
Worsening affordability has seen rental demand shift away from the more expensive house segment towards the more affordable medium to high-density sector, as the sustained period of strong rental growth, coupled with high non-discretionary inflation, has pushed more renters up against affordability constraints…
Worsening rental affordability continues to put downwards pressure on the pace of growth in house rents, while the return overseas migrants, where demand is typically skewed towards capital city unit markets, is helping to bolster demand for unit rentals…
Australia’s NOM hit its highest ever level in the March quarter, with a record 96,200 net migrants arriving:
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Highest ever NOM in March quarter.
The Albanese Government used the Jobs & Skills Summit as a trojan horse to lift temporary and permanent migration to record levels, which will necessarily add hundreds of thousands of extra people that will require housing.
Where will they live when there is already a chronic shortage of rental homes for the existing population? In tents? On the streets?
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The only plausible outcome of the Albanese Government’s mass immigration drive is an even tighter rental market, soaring rents, and a rapid increase in homelessness. It is an inequality disaster in the making.
With friends like Albo, Australia’s renters sure don’t need enemies.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
