What is the rental market crisis in Melbourne?

Landlords are asking $25 more a week for the typical Melbourne apartment compared with last year as rents hit record highs, leaving tenants under pressure in a cost-of-living crisis.

Why is it so hard to rent a house in Melbourne?

What is causing the rental crisis in Australia?

Population Growth

This steady growth has led to an increased demand for housing, putting pressure on the rental market. With more people to accommodate, there is a higher demand for rental properties. This demand, coupled with a lack of supply, results in higher rental prices.

Will rent go down in 2025 in Melbourne?

Laura says 2025 is going to be no different in terms of the ups and downs, with the market continuing to adapt and evolve. “It is looking like the demand for rental properties in 2025 is going to become tighter, which will see renters start looking for longer leases and owners achieving higher rental prices,” she says.

Are rents going down in Victoria?

The latest report from Rentals.ca ranks the $2,035 cost for a one-bedroom in Victoria as Canada's 19th most expensive market, seeing a 0.9% drop from last month and a 6.6% decline from August 2024. North Vancouver tops the list at $2,602, followed by Vancouver at $2,529 and Coquitlam at $2,331.

Melbourne's disappearing landlords as the rental crisis worsens | 7 News Australia

Is Victoria still in a rental crisis?

Victoria's rental market has seen a dramatic shake‑up. In 2024 the state recorded its sharpest fall in rental supply on record – roughly 21,000–25,000 fewer rental homes on the market. Industry sources say this 'landlord exodus' is linked to recent policy changes.

What is the average rent in Victoria?

Victoria has the fifth highest monthly rent price for apartments and condos in major cities across the country, at $2,337, which is a decline of two per cent compared to the same time last year. That average breaks down to $2,040 for a one bedroom and $2,681 for a two bedroom in Victoria, according to the report.

What is Melbourne's rental market like?

Melbourne's rental market remains tight — but as previously reported the rate of rental growth is beginning to ease. The annual change in the last 12 months is 2.0% with lowest it has been for several years.

Why will 2025 be the worst year yet for landlords and renters?

So, what are my property predictions for 2025? More vacant homes: Driven by over-regulation across the property market. Higher rents: Demand keeps growing and supply is shrinking, which means rents will rise. This will reflect in higher risk for investors.

What suburbs are undervalued in Melbourne?

What is the most unaffordable city to rent in Australia?

Perth has overtaken Sydney as the nation's least affordable city to rent, with figures showing Perth's median rent hit 30.6 per cent of average rental household income in 2024, compared to 30.3 per cent in Sydney.

Why are landlords struggling?

Landlords under pressure

Many landlords are also facing serious financial difficulties. This is due to rising mortgage rates, coupled with other cost increases.

Is Australia's housing crisis the worst in the world?

Not one of 95 international property markets analysed falls into the category of affordable, but Australia is among the very worst and property bubble risks are now real. Australia's housing market is at a crossroads, as new affordability figures signal a nationwide housing crisis exacerbated by international factors.

Is it better to buy or rent in Melbourne?

Compare The Market says renters in Melbourne CBD could, on average, save a whopping $688 a month if they bought an apartment instead, CoreLogic says the median monthly rent in Melbourne's CBD is $2882. This compares unfavorably to estimated monthly repayments of only $2193.

Is Melbourne in a housing crisis?

The electorate of Melbourne is facing an acute housing crisis, with a substantial social housing shortfall, and high levels of rental and mortgage stress. The deepening housing crisis affects thousands of residents across the electorate, making stable and affordable housing increasingly unattainable for many.

What is the average rental in Melbourne?

Melbourne's median asking unit rent is $575 a week, 4.5 per cent higher than a year ago, shows Domain's latest Rent Report for the June quarter, released on Thursday. Asking rents for houses are also at a high, holding stable over the past year at a median $580 a week.

What salary do you need to live in Victoria?

The Living Wage for our region is calculated annually by the Community Social Planning Council of Greater Victoria (CSPC) and is based on a 35 hour work week. At $24.29/hour ($44,208 annually per parent), the 2022 Living Wage for Greater Victoria is a $3.83 increase from 2021.

How much should I spend on rent in Melbourne?

As a general rule, minimising your rental costs is probably one of the biggest ways you can save money. If you're spending more than 30% of your income then you're definitely above the Australian average. Based on the data above, if you wanted to save on rent you could: Rent a unit.

What percentage of Melbourne rent?

In the City of Melbourne, 28% of households were purchasing or fully owned their home, 59.5% were renting privately, and 3.3% were in social housing in 2021.

Why are investors leaving Melbourne?

Property investors are continuing to flee Victoria in the tens of thousands amid increased land taxes and tightened rental regulations. Industry figures have urged the state government to deal with the problem by giving landlords a reprieve from the onslaught of ongoing rental reforms introduced since 2019.

What is the rental crisis in Melbourne 2025?

Inadequate Housing Supply

A major contributor to the rental crisis Melbourne faces is the insufficient construction of new housing. While the population has grown rapidly, the supply of rental properties has not kept pace. Melbourne's vacancy rate fell to 1.5% in January 2025, reflecting extreme competition.

Why are people not investing in Victoria?

She said that strict regulations for landlords in Victoria, including tenant-favouring laws, lengthy eviction processes, and high compliance requirements such as gas and electrical safety checks, make the market less appealing to investors.

What is the most unaffordable city in the world?

The most unaffordable market was Hong Kong, where the median house price was more than 14 times the median income of a worker in the city. Australia was also notably unaffordable. Metropolitan areas of Sydney, Adelaide and Melbourne were all in the top 10 as well.

Is Australia's standard of living declining?

Yet Australia experienced a far sharper fall in living standards (measured by household income per person) than elsewhere. Across the wealthiest countries living standards, on average, rose by nearly 6 per cent from mid 2022 to late 2024. In Australia they shrunk by an alarming 6.7 per cent.

Why is the rental crisis so bad in Australia?

High housing prices have forced many Australians to rent for longer, reducing the availability of rental properties. The same can be said for high immigration and holiday homes, while policies such as HomeBuilder inflated even more house prices, while Council and planning restrictions made harder to increase supply.