Rental Pain Index September 2024

The September 2024 Suburbtrends Rental Pain Index (RPI) reveals that while rental price growth may have slowed in some regions, Australia’s rental crisis is far from over. Data across Local Government Areas (LGAs) shows a persistent strain on renters, driven by low vacancy rates and a continuing shortage of affordable rental properties.

The Rental Pain Index (RPI) analysis for September 2024 continues to highlight escalating rental pressures across most Australian states. Nationally, the percentage of suburb areas (SA2s) with an RPI of 75 or higher has remained at 68%, reflecting ongoing rental stress across the country.

In New South Wales (NSW), the proportion of SA2s in extreme rental pain has slightly decreased from 67% to 65%, though affordability remains strained with average rents increasing by 9% and 33% of income spent on rent. Queensland (QLD) shows a modest improvement, with the percentage of SA2s in extreme pain falling from 78% to 75%, despite rental prices rising by 10% and 32% of income allocated to rent.

South Australia (SA) saw a rise in extreme rental pain, from 80% to 81%, with rents increasing by 11% and 32% of income spent on rent. Western Australia (WA) experienced stability, with 77% of SA2s in extreme pain, driven by a 16% rent increase and 32% of income going towards rent.

Victoria (VIC) observed a slight decline in extreme rental pain, from 71% to 70%, with rents rising 11% and rental costs reaching 28% of income. The Australian Capital Territory (ACT) saw a marginal rise in extreme rental pain from 8% to 9%, with affordability tightening further. The Northern Territory (NT) experienced little change, with extreme rental pain stable at 31%, despite a modest 2% rent increase and 25% of income spent on rent.

Tasmania (TAS) saw a small increase in extreme rental pain, rising from 27% to 31%, with rental affordability deteriorating despite a 1% rent increase and 31% of income devoted to rent.

Overall, rental affordability challenges persist, with significant portions of household income directed towards rent, particularly in NSW, QLD, SA, and WA. These trends continue to strain household finances and could have broader economic impacts. Targeted interventions remain critical to addressing rental affordability and ensuring a sustainable housing market.

Easing Price Increases

While rental price increases have eased in some areas, it’s important to recognise that this doesn’t signal a significant improvement in rental stress. In many regions, renters are still spending well over 30% of household income on rent. Low vacancy rates exacerbate the problem, leaving many Australians locked in competition for a limited supply of rental properties.

State Averages

The Rental Pain Index (RPI) data for September 2024 reveals continued challenges in rental affordability across Australia. The national average RPI has risen to 77, up from 72 in August, indicating growing pressure on renters. National rental affordability has increased to 31% of household income, highlighting ongoing struggles for Australians to manage rent costs.

Western Australia (WA) remains under strain, with an RPI of 82, unchanged from August. Rental prices have increased by 16%, and renters are spending 32% of income on rent, showing continued affordability challenges.

Queensland (QLD) sees slight improvement, with the RPI at 81, down from 83. Rent prices have increased by 10%, with 32% of income allocated to rent, maintaining significant pressure on renters.

South Australia (SA) now has the highest RPI at 85, up from 82 last month. Rental prices have risen by 11%, and 32% of income is required for rent, reflecting growing concerns over affordability.

In New South Wales (NSW), the RPI has decreased to 78 from 79, though renters still allocate 33% of income to rent. A 9% annual rental increase indicates persistent affordability issues.

Victoria (VIC) holds steady at an RPI of 76, with a 12-month rent increase of 11%. Renters spend 28% of income on rent, showing a relatively high level of affordability strain.

The Australian Capital Territory (ACT) shows an RPI of 51, up from 46. Rent affordability remains manageable, with 24% of income spent on rent, and the vacancy rate tightening to 2.3%.

The Northern Territory (NT) remains stable with an RPI of 66. Renters spend 25% of income on rent, and prices have increased by 2%.

Tasmania (TAS) maintains an RPI of 62, with 31% of income spent on rent and a vacancy rate of 1.9%.

This analysis shows that rental stress remains widespread, with South Australia and Queensland facing the most significant affordability challenges.

Extreme pain

The September 2024 Rental Pain Index (RPI) continues to highlight severe rental stress across Australia, with a focus on suburb areas where RPI scores exceed 75, signifying extreme distress.

Western Australia (WA) remains one of the most affected states, with 77% of suburb areas in severe rental stress, consistent with last month’s figure. The state continues to grapple with significant rental affordability challenges.

Queensland (QLD) sees a slight decrease in extreme rental stress, with 75% of its suburb areas now affected, down from 78% last month. However, the state remains one of the hardest-hit regions for rental stress.

South Australia (SA) experiences a small increase, with 81% of its suburb areas facing extreme rental stress, up from 80% in August. This marks SA as one of the states experiencing the highest levels of rental pressure.

New South Wales (NSW) sees a minor decrease, with 65% of its suburbs in severe rental stress, down from 67%. Victoria (VIC) follows a similar trend, with 71% of suburbs affected, down from 71% last month, indicating persistent but stable affordability pressures in both states.

Tasmania (TAS) experiences a modest increase, with 31% of its suburbs in extreme stress, up from 27%, reflecting worsening conditions. In contrast, The Northern Territory (NT) sees a decrease to 28%, down from 31%.

The Australian Capital Territory (ACT) remains stable, with 8% of suburbs experiencing severe rental stress, the same as last month.

On a national level, 68% of suburb areas are now in extreme rental stress, unchanged from last month, reflecting a nationwide rental affordability crisis that remains a pressing concern.

Top LGAs Continue to Face Severe Rental Pain

Key data from the report highlights:

• Queensland and South Australia are among the hardest-hit areas, with many LGAs showing Rental Pain Index scores over 80.
• Despite slower rent increases in certain regions, vacancy rates below 1% are worsening rental stress.
• The lack of affordable housing options remains a key driver behind the high levels of rental stress.

The Rental Pain Index takes into account more than just rental price growth. It measures the broader affordability issues and the availability of housing, both of which remain critical challenges across many LGAs.

The Human Impact

The housing crisis is not just a matter of affordability; it has real consequences for those at risk of losing their homes. Across multiple LGAs, rental affordability continues to exceed 30% of household income, pushing families to the brink of homelessness. Even where rent increases have moderated, the severe lack of affordable housing options continues to drive displacement and financial stress for renters.

Faith-Based Solutions Offer Hope

Amid this backdrop, faith-based organisations such as Sydney Anglican Property (SAP) and Anglicare are taking steps to provide long-term affordable housing. SAP, in particular, is developing 1,000 affordable rental dwellings under the Federal Government’s Housing Australia Future Fund, leveraging underutilised church-owned land.

These initiatives demonstrate the kind of community-focused solutions needed to address the supply-side issues at the heart of Australia’s rental crisis. Faith-based organisations are making a valuable contribution to easing rental pain by unlocking housing opportunities for vulnerable populations.

Want the Full Report?

For detailed insights into the September 2024 Rental Pain Index, including the hardest-hit LGAs and national rental trends, please contact Suburbtrends for the full report.

?? Kent Lardner: 0458 936 912 ?? Email: [email protected]

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