Competition for rental properties in capital cities remains ferocious as new research today showed more than 44 per cent of suburbs recorded double-digit rent hikes.
A tight rental market combined with an influx of overseas migrants and international students has led to the strongest annual rental increase on record, according to analysts at CoreLogic.
About 1,700 house and unit suburbs have recorded a rental increase of 10 per cent or more in the past year, despite the pace of rental growth showing signs of easing.
READ MORE: Struggling renters should get flatmates or move home, RBA boss says
In May, rents rose 0.8 per cent in May compared with the 0.9 per cent and 1 per cent increases in April and March respectively.
But the slowdown was largely driven by a drop-off in regional markets, offering little to cheer about for would-be tenants in capital cities.
In regional Australia, rents increased 0.3 per cent over May, down from a record monthly growth rate of 1.2 per cent in March 2022.
"Regional rental growth has slowed dramatically from a year ago while capital city rents were up 1.0 per cent in May," said CoreLogic economist Kaytlin Ezzy.
Prospective tenants struggling to find a home are putting the unit sector under the greatest pressure due to their relative affordability.
Capital city apartment rents jumped by 1.4 per cent in May, compared with a 0.9 per cent lift in house rents.
READ MORE: Queensland laws aiming to help tenants could force them out of homes
And that is reflected in the narrowing of the gape between median house and unit rents to $60 per week across the combined capitals and $36 per week nationally.
While there was a slight increase in rental property, with 4,409 new listings added to the market in May compared to April, the only capital city to see a dip in rents was Canberra - of -1.9 per cent.
The softening rental conditions in the ACT was likely due to more stock on the market.
Hobart has the highest vacancy rate of 2.7 per cent, followed by Canberra (2.2 per cent).
All other capital cities recorded vacancy rates under 1.5 per cent.
Melbourne saw the strongest month-on-month change in rents, rising 1.4 per cent in May.
Sign up here to receive our daily newsletters and breaking news alerts, sent straight to your inbox.
