Why Australia’s rental crisis will get much worse

CoreLogic’s latest rental data shows that the number of homes listed for rent nationally has plunged to its lowest level in around a decade:

This decline in rental listings has been driven by the major capital cities, with Melbourne (-36.2%), Sydney (-31.4%) and Brisbane (-30.2%) experiencing especially sharp falls over the past year:

A new report from the Australian Housing and Urban Research Institute (AHURI) claims that Australia’s rental vacancy rate is tracking at 20-year lows, and this has helped drive rents nationally into the stratosphere:

The AHURI also blames Australia’s rental crisis on there being “not enough homes to keep up with population and household growth”:

At a basic level, Australia needs sufficient new housing to house the nearly one million new households formed between the 2016 and 2021 Census; an 11.9 per cent increase (or an average of 197,826 households per year)…

The number of new residential dwellings did not keep up with the number of new households, increasing by only 10.6% per cent (around 198,000 new dwelling each year)…

As the rate of household formation is greater than the increase in new dwellings, this leads to increased pressures on housing demand.

Over the pandemic, Australia’s rental market tightened because of the sharp reduction in household size, with households suddenly needing more space for home offices and the like:

The Albanese Government has since launched the biggest immigration program in this nation’s history, with the federal budget forecasting nearly one million migrant arrivals over the next four years:

Federal Budget: Nearly one million net overseas migrants to arrive over next four years.

Already, net temporary student and work visa arrivals have swollen to record levels, which will likely to see the federal budget’s net overseas migration forecasts comprehensively beaten:

Record student and work visa providers.

Inner Sydney’s and inner Melbourne’s rental markets are likely to get hit the hardest, given most new arrivals into Australia are renters, and most arrive in the heart of Sydney and Melbourne.

Where will these migrants live when there is already a chronic shortage of rental homes for the existing population?

The Albanese Government’s ‘Big Australia’ immigration policy is an unmitigated disaster that will tighten the rental market further, drive rents further into the stratosphere, and force thousands of Australians into homelessness.