‘Tough' call as rents fall in 129 Melbourne suburbs

Herald Sun

2 days ago

Rents in Melbourne have jumped $7800 a year since 2019, but wages have barely budged, and the result is a growing affordability crisis that's locking out even middle-income earners.
New figures from PropTrack reveal rental affordability has plunged to its worst level since records began, with typical households now able to afford just 36 per cent of advertised rentals nationally.
In Melbourne, the situation is less dire than in other capitals, but far from comfortable.
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PropTrack senior economist Anne Flaherty said Victoria remained the most affordable state for renters, but 'renters are still doing it tough'.
'Compared to five years ago, the average renter in Greater Melbourne is now paying about $7800 more annually,' Ms Flaherty said.
'And nationally, the share of affordable rentals for typical income households has dropped to record lows.'
RENTS FALLING: CHANGES IN EACH SUBURB REVEALED
The squeeze is hitting younger renters hardest, with just 19 per cent of listings affordable to households aged 15-24.
For low-income earners on $70,000, that figure plummets to just 2 per cent.
Ms Flaherty said more young people were staying at longer.
'It's not because they want to but because they simply can't afford to leave,' she said.
Even as 126 Melbourne suburbs recorded rent price falls and 227 were frozen in the three months to May, renters have yet to feel any meaningful relief.
Falling suburbs include a mix of outer and middle-ring areas such as Doncaster East, Cranbourne, Hillside, and Tarneit, but rent values remain elevated due to tight supply.
Jellis Craig North director Greg Cusack said inspections were still attracting queues, with renters going to increasing lengths to stand out.
'At most opens, we're seeing people line up before the agent arrives,' Mr Cusack said.
'Some are dressing up, striking up conversations, trying to make an impression.
It's not just about submitting an application anymore, it's about winning the property.'
Mr Cusack said many renters were being pushed out of traditional inner-city hubs like Fitzroy and Northcote and were heading further north to suburbs such as Glenroy, Oak Park and Reservoir for better value and said group applications for share houses were surging, as renters tried to reduce costs.
'We're seeing three or four friends band together for houses they wouldn't consider solo — it's becoming the norm, not the backup plan,' he said.
Ms Flaherty said while investor activity was picking up and rental growth had slowed, the pressure on tenants wouldn't disappear overnight.
'I do think we've passed the peak of the rental crisis,' she said.
'But unless we dramatically boost housing construction, affordability will stay stretched.'
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