Rent Inflation in Australia decreased to 4.50 percent in the second quarter of 2025 from 5.50 percent in the first quarter of 2025. This dataset includes a chart with historical data for Australia Rent Inflation.

The rent price index in Australia in the first quarter of 2025 was 122.1, marking an increase from the same quarter of the previous year. Rent prices had decreased in 2020; in Melbourne and Sydney, this was mainly attributed to the absence of international students during the coronavirus outbreak. The current state of the rental market in Australia The rental market in Australia has been marked by varying conditions across different regions. Among the capital cities, Sydney has long been recognized for having some of the highest average rents. As of March 2025, the average weekly rent for a house in Sydney was 775 Australian dollars, which was the highest average rent across all major cities in Australia that year. Furthermore, due to factors like population growth and housing demand, regional areas have also seen noticeable increases in rental prices. For instance, households in the non-metropolitan area of New South Wales’ expenditure on rent was around 30 percent of their household income in the year ending June 2024. Housing affordability in Australia Housing affordability remains a significant challenge in Australia, contributing to a trend where many individuals and families rent for prolonged periods. The underlying cause of this issue is the ongoing disparity between household wages and housing costs, especially in large cities. While renting offers several advantages, it is worth noting that the associated costs may not always align with the expectation of affordability. Approximately one-third of participants in a recent survey stated that they pay between 16 and 30 percent of their monthly income on rent. Recent government initiatives, such as the 2024 Help to Buy scheme, aim to make it easier for people across Australia to get onto the property ladder. Still, the multifaceted nature of Australia’s housing affordability problem requires continued efforts to strike a balance between market dynamics and the need for accessible housing options for Australians.

Australia’s real house price index increased to 122.4 in the first quarter of 2025. House prices fluctuated over the reported period compared to the base year of 2015, experiencing a sharp increase throughout 2021, with the country’s house price index peaking in the first quarter of 2022 at 131.1. Prospective homeowners priced out of the market Recent house price increases reflect the ongoing challenges of housing affordability in Australia. Property prices largely outpace income growth, reigniting discussions about whether the country is stuck in a property bubble, a topic that has been debated for over a decade. The country’s house price-to-income ratio hit 122.5 in the second quarter of 2024, the highest ratio recorded over the past five years, making it increasingly difficult to get on the property ladder. Unaffordable rental conditions Australia’s rental market has also seen challenges, with the rent price index continuing to climb throughout 2024 into the first quarter of 2025, making the prospect of renting less appealing. As of March 2025, the average weekly house rent price in Sydney stood at 775 Australian dollars, the highest across the country’s major cities. Canberra, Darwin, and Perth were the next most expensive markets for house rents, while Hobart was the most affordable capital city for both house and unit rent prices.

Between March 2024 and March 2025, wages in Australia declined by around 0.6 percent. Wage growth in recent years has been relatively low in comparison to previous years, in particular in December 2020, which only saw a wage growth of 1.3%. Inflation and CPI outstripping wages While wages have increased in Australia, they have still not matched the rate of inflation, which was sitting at 2.4 percent at the end of 2024, down from a high of 7.8 percent at the end of 2022. The high cost of goods has also put pressure on the public, with the Consumer Price Index standing at around 139.4 points, compared to a base year of 2011-12. Rent is on the rise As with many around the world, Australians are also feeling the costs of rent increases. The majority of people in Australia perceive that the cost of rent has risen significantly in their local area. This in turn has seen the government expenditure on rental assistance continue to be high, with around 4.7 billion Australian dollars spent to assist the Australian public in maintaining their housing needs.

Australia Consumer Price Index (CPI): Perth: Housing: Rents: Rents data was reported at 124.200 2011-2012=100 in Mar 2025. This records an increase from the previous number of 122.100 2011-2012=100 for Dec 2024. Australia Consumer Price Index (CPI): Perth: Housing: Rents: Rents data is updated quarterly, averaging 56.300 2011-2012=100 from Sep 1972 (Median) to Mar 2025, with 211 observations. The data reached an all-time high of 124.200 2011-2012=100 in Mar 2025 and a record low of 12.200 2011-2012=100 in Sep 1972. Australia Consumer Price Index (CPI): Perth: Housing: Rents: Rents data remains active status in CEIC and is reported by Australian Bureau of Statistics. The data is categorized under Global Database’s Australia – Table AU.I007: Consumer Price Index: 2011-12=100: Eight Capital Cities.

The Crisis and Care Accommodation industry forms part of Australia's community welfare sector and provides services for some of the most economically vulnerable people in Australian society, including children, those with long-term disabilities and the elderly. Even before the COVID-19 pandemic and the cost-of-living crisis, a growing number of Australians were at increased risk of homelessness, with many experiencing financial hardship, persistent disadvantage and social exclusion. Stagnant wage growth in inflation-adjusted terms, heightened housing stress and associated incidences of family breakdown and family violence have boosted demand for crisis and care accommodation over the past few years. Given high inflation and rising rental costs, many of the industry’s clients have become increasingly vulnerable and their needs are also becoming more complex. Rising disability prevalence is creating additional challenges for residential care providers, with the Australian Bureau of Statistics finding that 5.5 million Australians had a disability in 2022 (latest data available). However, the ability to meet increased demand hasn't necessarily been matched by additional funding, constraining industry and profit growth. In light of these socio-economic variables and supply constraints, industry revenue growth is expected to be a modest 4.3% annualised over the five years through 2024-25 to $5.7 billion, including anticipated growth of 4.0% in the current year. Solid demand for residential care services will persist in the coming years, bolstered by a strong need for homelessness services as high rents and inflation exacerbate Australia’s housing crisis. An ageing population is set to continue driving demand for palliative care and respite services, while the existence of deep and persistent disadvantage among Australia’s most vulnerable population cohorts will continue to sustain demand for crisis and rehabilitation care. Government policies and associated regulatory reforms – including those stemming from the Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability – will dictate the industry's operating environment. Industry growth rates will remain modest at 2.7% annualised through 2029-30, to reach $6.5 billion.

Australia’s industrial and other property operators have faced volatile performance in recent years, with revenue growth closely linked to interest rate movements and evolving occupier trends. After a period of strong expansion on the back of low borrowing costs and soaring ecommerce demand, revenue contracted sharply in 2022-23 when the Reserve Bank raised rates, curbing both speculative developments and new leasing. More recently, stabilising interest rates and easing inflation have begun to restore investor confidence, though uncertainty remains a challenge. Overall, industry revenue has risen at an annualised 3.7% over the past five years and is expected to total $20.7 billion in 2024-25, when revenue will drop by an estimated 1.6%. Industry profitability closely mirrors interest rate cycles, with margins peaking during periods of low borrowing costs and strong leasing demand, as seen in 2021-22. However, profit growth has moderated since mid-2022 as the Reserve Bank’s tightening cycle increased financing costs and subdued new development activity, bringing returns down to pre-pandemic levels by 2024-25. While absolute demand for warehousing remains robust thanks to continued ecommerce demand, its share of overall industry revenue is now shrinking as operators prioritise higher-value segments like data centres, specialised production sites and climate-resilient agricultural facilities, which have been delivering longer leases and more stable returns. Going forwards, easing inflation and steady interest rates are reviving confidence in Australia’s industrial property sector, encouraging businesses to expand facilities and commit to new projects. Large retailers are set to increasingly build and own their own advanced distribution centres, reshaping demand towards build-to-own solutions and digital asset management. The continued growth of online shopping is fuelling the need for modern warehouses and last-mile logistics hubs, especially in major urban centres. Supported by significant government infrastructure investment and more streamlined foreign capital inflows, property operators are prioritising high-spec, technology-driven assets, with premium locations and value-added services set to drive industry growth in the coming years. This combination of factors is expected to culminate in annualised growth of 1.8% through 2029-30 to $22.5 billion.

Australia Average Annualised Wage Increases: Current: By ANZSIC 2006: Rental, Hiring & Real Estate Services data was reported at 2.640 % in Dec 2024. This records an increase from the previous number of 2.204 % for Sep 2024. Australia Average Annualised Wage Increases: Current: By ANZSIC 2006: Rental, Hiring & Real Estate Services data is updated quarterly, averaging 3.487 % from Dec 1991 (Median) to Dec 2024, with 133 observations. The data reached an all-time high of 7.801 % in Sep 1996 and a record low of 0.000 % in Mar 1994. Australia Average Annualised Wage Increases: Current: By ANZSIC 2006: Rental, Hiring & Real Estate Services data remains active status in CEIC and is reported by Department of Employment and Workplace Relations. The data is categorized under Global Database’s Australia – Table AU.G104: Average Annualized Wage Increases: ANZSIC.

Australia Average Annualised Wage Increases: Processed in the Quarter: By ANZSIC 2006: Rental, Hiring & Real Estate Services data was reported at 3.940 % in Dec 2024. This records an increase from the previous number of 3.898 % for Sep 2024. Australia Average Annualised Wage Increases: Processed in the Quarter: By ANZSIC 2006: Rental, Hiring & Real Estate Services data is updated quarterly, averaging 3.528 % from Dec 1991 (Median) to Dec 2024, with 133 observations. The data reached an all-time high of 10.250 % in Jun 1996 and a record low of 0.000 % in Sep 2004. Australia Average Annualised Wage Increases: Processed in the Quarter: By ANZSIC 2006: Rental, Hiring & Real Estate Services data remains active status in CEIC and is reported by Department of Employment and Workplace Relations. The data is categorized under Global Database’s Australia – Table AU.G104: Average Annualized Wage Increases: ANZSIC.