Rising Rents Push Australians Towards Co-Living Arrangements
The current housing shortage is reshaping urban living norms.
As rents have surged by almost 40% in the last five years, cities are witnessing a trend towards larger households, spearheaded by international students opting to live together.
Housing has turned into a focal point for major political parties vying for the attention of first-time homebuyers, while renters are still facing challenges.
The number of advertised rental listings remains significantly below average, according to property data firm CoreLogic’s Quarterly Rental Review issued recently.
Only about 99,000 rental properties were listed nationwide over a four-week period, which is more than 22% lower than the usual level for this time of year.
“Due to escalating costs, many renters are adapting by choosing to share accommodation or delaying independent living, leading to a decrease in overall rental demand,” explained CoreLogic senior economist Kaytlin Ezzy.
Since March 2020, national rents have soared by 38.4%, equating to an additional $182 per week, totaling an average of $9,442 annually.
Related Stories
Current vacancy rates have dropped to 1.6% in March, down from 2.0% in December.
“The recent uptick in unit rents is likely associated with the seasonal surge in demand from international students who typically prefer high-density housing,” noted Ezzy.
Sydney retains its status as the most unaffordable city for renters, with a median weekly rental value of $781, while Hobart stands at $574, making it the cheapest capital city for leasing.
The housing policies presented by Labor and the coalition, valued at $24 billion combined, aim to address the housing supply shortage in the market, ultimately leading to price reductions.
The Greens have criticized both major parties for inflating house prices and jeopardizing renters’ dreams. The party has pledged to enforce a cap on rent hikes, limiting them to every two years if they win a minority government.
A home in Edmondson Park on April 28, 2016, in Sydney, Australia. Brendon Thorne/Getty Images
The coalition has committed to reducing the number of international students by 80,000, which they argue are exacerbating the housing crisis.
The Property Council of Australia disputes this claim, noting that foreign students represent only 4% of Australia’s rental market.
Core Logic stated on Wednesday that recent migration data has alleviated housing demand, with net overseas migration in the year to September 2024 dropping by over 30% compared to the previous year’s peak.
Lyndall Bryant, leading the QUT Centre for Justice Housing Security Research Group, is proposing an unconventional interim solution beyond the supply debate that could benefit homeowners and tenants in need.
She advocates for whichever party wins government to incentivize the use of the 13 million spare bedrooms.
Most of these properties are owned by older individuals who are asset-rich but income-poor, and could benefit from the extra income derived by renting out a room, as long as it does not impact their pension, as suggested by Bryant.
“This would not only alleviate financial pressures for homeowners but also provide the social and psychological benefits that come with shared living arrangements,” Bryant emphasized.
