National rental values rose 1.7% in the March quarter—up from 0.4% in December—according to CoreLogic, though analysts noted this seasonal boost comes amid a broader slowdown in rental market growth.
While this marks the highest quarterly growth since early 2024, it’s also the slowest first-quarter rise since 2019, when rents grew by just 1%. It’s a full percentage point below the 2.7% rise seen in the same period last year.
CoreLogic’s national rent index is now 38.4% higher than pre-COVID levels, with the average renter paying approximately $182 more per week compared to early 2020.
PropTrack also reported a similar uptick, with national advertised rents rising 1.6% over the quarter to a median of $630 per week, representing a 5% annual increase—or around $1,560 more per year for tenants
Affordability challenges and slower population growth dampen demand
“Rental growth is still tracking above the pre-COVID-19-decade annual average of 2%, but the rate of change has slowed considerably,” said CoreLogic economist Kaytlin Ezzy (pictured). “At 3.8%, the 12-month change is now less than half the recent 8.3% peak recorded over the year to March 2024.
“The further increase in the average household size due to worsening affordability, along with the slowing in population growth, continues to put downward pressure on rental demand and, subsequently, on rental value growth.”
Although demand is easing, the supply of available rentals remains historically low.
Just 99,000 properties were listed for rent over the four weeks to April 6 — that’s 22.1% below the historical average for this time of year.
Consequently, vacancy rates dropped from 2.0% in December to 1.6% in March, approaching the record low seen in March 2024.
The March quarter increase was driven primarily by unit rentals, which rose 2.3% nationally, compared to 1.4% for houses—a reversal of recent trends where houses had outpaced unit growth.
“The renewed growth in unit rents is likely linked to the seasonal lift in demand from international students who typically favour higher density housing,” Ezzy said.
The rental premium for houses continues to grow, with the gap between median house and unit rents increasing from $38 in June 2023 to $47 in March 2025.
“While still below the $71 gap recorded at the end of 2021, the expanding of the house rent premium has eroded some of the relative affordability advantage that some renters have gained by forming larger share houses,” Ezzy said.
Rent increases were seen across all capitals during the March quarter, with Hobart posting the strongest growth at 2.3%, followed by Perth (2.2%), Brisbane (1.9%), and Adelaide (1.8%).
Sydney and Melbourne saw a turnaround in momentum after declines in Q4 2024, with rents rising 1.4% and 0.8%, respectively. Darwin showed the softest result, up just 0.3%.
Perth continues to dominate annual growth, with rents up 6.3%, trailed by Adelaide (5.5%) and Hobart (4.6%). Canberra recorded the smallest increase at 1.6%, equating to an additional $10 per week.
Despite recent gains, Hobart remains the most affordable capital with a median weekly rent of $574, while Sydney remains the most expensive at $781.
Since March 2020, national rents have surged 38.4%, equating to an additional $182 per week—or $9,442 annually. This steep increase has significantly changed renting behaviours.
“With affordability stretched, many renters are adjusting by staying in shared accommodation or delaying independent living, which in turn reduces net rental demand,” Ezzy said.
Slowing migration and household changes point to more moderate future increases
Migration is also slowing, with net overseas arrivals falling more than 30% from the previous year, coming in at just under 380,000 people in the year to September 2024.
"Given the easing in demand, it’s likely rental growth will remain relatively subdued over the coming quarters, even in the face of tight supply,” Ezzy said.
