Australia’s rental market is being redrawn as institutional capital and long-term renters transform how housing is funded and delivered – and mortgage brokers are increasingly in the frame.
Colliers’ Australian Living Capital Markets Investment Review and Outlook 2026 suggests the country is tilting towards a rental‑driven delivery model, as population growth, entrenched dwelling shortages, and new Living platforms reshape how new stock comes to market.
Large investors have traditionally struggled to access Australia’s $12 trillion housing market at scale, with most dwellings owned by individuals. That is starting to change as purpose‑built rental platforms, multi‑sector funds, and professionally managed operating models gain momentum.
“Renting is no longer a temporary form of tenure before entering homeownership. As the population expands and housing affordability further declines, long-term renting is becoming a financial necessity for more Australians, as well as a deliberate lifestyle choice by some,” said Robert Papaleo (pictured left), head of living.
“Investors are responding to the underlying opportunities created by these fundamental changes in household behaviour across multiple life stages as well as the need for more capital to create new supply.”
According to Colliers, 2025 marked a turning point as capital flowed from single‑sector beachheads into multi‑sector Living platforms spanning different demographic segments. Stabilised assets, portfolio activity and recapitalisations have become key themes.
“With development pipelines under pressure, portfolio sales and recapitalisation of early-stage investors out of existing funds are expected to be features of the 2026 Living sector market,” said Jade Grantham (pictured center), director, living capital markets.
At the same time, national rents have climbed more than 25% over the past five years while dwelling values continue to outpace incomes, pushing many households into long‑term renting. Mid‑income, mid‑aged households, in middle‑ring suburbs face limited choice in purpose‑designed rental stock compared with inner‑city professionals and outer‑suburban retirees.
“Delivering suitable housing for middle-aged couples and families not only fills a gap in the market but strengthens the resilience of the rental sector across life stages,” said Jonathan Mayes (pictured right), associate director of research.
Recent research into renter and landlord behaviour suggests another pressure is building beneath the surface of the market. Rising rental churn – driven by instability rather than rent levels – is emerging as a hidden portfolio risk for investor‑borrowers, tightening supply and stretching serviceability.
As the living sector evolves into an integrated ecosystem across inner‑city, middle‑ring and outer‑suburban locations, Australian mortgage brokers can expect more institutional and sophisticated borrowers chasing scalable rental strategies, more everyday clients planning to rent for the long haul, and sharper scrutiny of serviceability and portfolio resilience in a market where renting is no longer just a brief step on the path to homeownership.
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