Renters are being hit with rising housing costs again, with new data showing last year’s brief slowdown in rent growth has already reversed.
Australia’s rental market accelerated in the first months of 2026, with Cotality’s latest quarterly review showing rents rose by 2.1 per cent in the March quarter, up from 1.2 per cent in the December quarter.
Year on year, national rents have spiked by 5.7 per cent, signalling the end of the easing phase seen through much of 2025.
Tenants’ Union of NSW chief executive officer Leo Patterson Ross said the figures underline the mounting strain on households trying to secure a rental.
“These latest numbers mean real pressure for renters, especially those looking to move,” Mr Patterson Ross told NewsWire.
“Not only are rents rising faster than wages, the fuel crisis is pushing up people’s moving costs – already an expensive and stressful period.”
The report found affordability has deteriorated sharply over the past five years, with households now spending a record 33.1 per cent of their pre-tax income on rent, up from 26.2 per cent during the pandemic.
Over the same period, typical weekly rent commitments have risen by about $202.
Mr Patterson Ross said the long-term surge meant many households were falling behind financially.
“Cotality’s report shows that renters are paying $11,921 more for a house and $13,330 more for a unit each year compared to five years ago – many people’s wages haven’t increased by a similar amount,” he said.
Rental listings remain about 18 per cent below the five-year average, with vacancy rates across the capitals sitting at just 1.6 per cent, leaving tenants with limited choice and little negotiating power.
Mr Patterson Ross said even the most affordable areas were becoming harder to access.
“There are pockets of affordability, though even the most affordable suburb for renting a house in Sydney has seen an increase of more than $700 for the year over the last year.”
Mr Patterson Ross pointed to one state as an example of how policy settings could limit rent increases.
“The real story is that renters in Canberra have been protected from the worst of these rising rents with protections against rent increases over a fair limit,” he said.
“Over the last year Canberra has seen only a 2.6 per cent increase compared to the national figure of 5.7 per cent
“This isn’t a short-term trend either, with five year rents in Canberra rising less than half as quickly as those in Sydney or Melbourne – saving renters more than a thousand dollars a year.”
Sydney remains the most expensive capital for renters, with median weekly rents at $824, while Melbourne is the cheapest mainland capital at $632.
Darwin recorded the fastest annual growth at 9.2 per cent, followed by Brisbane and Perth at 6.7 per cent.
The report also shows demand shifting toward apartments as renters search for cheaper options, with unit rents rising faster than houses over the March quarter and surging 46.9 per cent over the past five years.
With vacancy rates near historic lows and supply still lagging demand, the report warns relief is unlikely in the near term.
Mr Patterson Ross said governments needed stronger renter protections alongside more affordable housing supply.
“State governments should be taking the lesson from the ACT and globally that you can effectively protect renters against rising rents while efforts to achieve greater supply take effect,” he said.
“As Cotality also points out, agents or landlords increasing rents puts more pressure on inflation and increases the chance of interest rate rises. Protecting tenants has flow on benefits to a much greater pool of people.”
He said state and federal governments should lead efforts to ensure new housing is accessible and genuinely affordable by expanding publicly funded housing to 10 per cent of all homes.
“(This) would start to ease pressure on renters doing it toughest and bring real competition to the worst performing landlords.”
He also called for broader changes to the housing system, including reducing reliance on property speculation, reforming tax settings such as capital gains tax and negative gearing, and reviewing lending practices that may be contributing to higher prices.
As rents rise again, the question of how long tenants can continue to keep up with the growing cost of housing is becoming increasingly urgent.
