Sydney rents plateau as Gold Coast becomes Australia's most expensive rental market

Rents are holding at record levels throughout Australia, but in most cities – apart from Perth – rental growth is plateauing, simply because embattled tenants just can’t afford much more, new research reveals.

With vacancy rates tightening to an all-time low and the Gold Coast emerging as the country’s most expensive city, charging an eye-watering median of $900 per week, many renters are now quitting and moving in with friends or family.

The most expensive capital city is Sydney, with a median asking rent of $750 for houses.

“We’re still seeing the same underlying conditions of high demand and low supply pushing rents up, but now unaffordability is putting the brakes on how much further they can go,” says Domain chief of research and economics Dr Nicola Powell on the release of the latest Domain Rental Report.

“Usually, a low vacancy rate translates immediately into rental growth, but that connection is now loosening as such shockingly high rents are pushing people’s budgets to the extreme.

“Along with the cost of living rises and fuel costs and the uncertainty generally in the economy, tenants are having to find alternatives.”

That might mean moving further away from city centres or desirable suburbs, pivoting to units rather than houses in some areas where they offer better value, or moving back in with family or sharing with friends.

“The massive shift in the market we’re seeing now is to co-renting with friends,” says Ben Pretty, chief executive of Leaso, which is described as a “Tinder for renters”.

“And this is a movement extending far further than just cheap units shared with flatmates.

“Now, we’re seeing two people coming together and applying jointly to rent even more pricy properties as a way of reducing their everyday spend. Everyone’s doing it tough with rents now at such high levels.”

$800 per week

65C Alness St, Applecross WA 6153

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The new March 2026 Domain report shows Perth – with a startling vacancy rate of 0.3 per cent – as the standout for capital city rent rises, jumping by 5.7 per cent over the last quarter to $740 a week, behind only Sydney’s $800, which flatlined over the past three months.

The median rent in Hobart rose the second highest in the quarter, by 3.3 per cent to $620, in Darwin by 2.9 per cent to $720, in Adelaide by 2.4 per cent to $640, in Melbourne by 1.7 per cent to $590, in Brisbane by 1.5 per cent to $680 and stayed steady in Canberra with a $700 rent.

For units in Sydney, rents stopped growing over the quarter, staying at $750 a week, which will give some relief to tenants. But elsewhere, the flood of renters away from houses and to apartments in search of cheaper homes saw a 3.8 per cent increase in rents across the capital cities.

Melbourne continued its market recovery with unit rents rising 4.3 per cent to $600, and Perth jumped 5.3 per cent to $695.

Real Estate Institute of Western Australia president Suzanne Brown says Perth’s rental growth momentum was being driven by the lack of supply of properties.

$670 per week

5/32 Albert Street, Petersham NSW 2049

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“Our sales listings have fallen to record lows and with them, our rental listings too,” she says.

“Together with our tight vacancy rate and unprecedented numbers of investors now wanting to sell, it’s putting a lot of pressure on people renting and trying to rent.

“Agents are at open homes and hearing desperate stories from people who need a home, but they don’t have enough, and there’s no end in sight to the supply shortage.”

Brown says four factors are dampening the supply of properties and sending rents skyrocketing.

Investors don’t want to buy because they’re nervous about tax changes that might come in the budget; the likelihood of a no-grounds eviction clause being brought in; interest rates rising again; and the general uncertainty in the economy; and they’re veering to liquidity because of that insecurity rather than property.

A lot of sales are therefore going to owner-occupiers rather than investors, advises Edgar Natolo, chief executive of Natgroup Real Estate.

$575 per week

2-4 Shaw Street, Petersham NSW 2049

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“Investors are being further put off by the government talking about diminishing tax incentives like capital gains tax,” he says.

“Of the properties available to rent, there’s a lot of competition from interstate and overseas renters, especially international students, pushing up demand, and the level of rents.

So, we’re seeing a lot of people renting, instead, with their families or moving to co-housing with friends.”

The attractions of the area are obvious.

“After COVID especially, a lot of people, particularly from Sydney and Melbourne, are looking for that beach lifestyle, mixed with city living,” says Chris Lofaro, director of property management at Place Purpose Group.

$875 per week

20 Mount View Tce, Mount Pleasant WA 6153

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“Renters are having to move to suburbs further out to save money on rent.”

Generally, across Australia, investors are jittery because of the prospect of tax changes in the budget, the rising costs of holding property, insurance and compliance costs, global insecurity and the rising cost of living, says Ray White group head of property management Zac Snelling.

“We’re simply not building enough new dwellings to keep pace and the excess of demand over supply is the biggest driver of rents,” he says.

“So, we’re now seeing behaviours changing to cope, like sharing.”