Unveiling the Truth: The Real Story Behind Australia's Rental Affordability

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If you can’t find an affordable place to rent in a major city, should you move to a regional area?

As the country continues to grapple with a housing affordability crisis and record-high rental prices, it’s a question that many Australians face.

However, moving away from a capital city can come with a range of potential sacrifices — from having to find new employment to being physically disconnected from one’s family and community.

What’s more, finding an affordable rental in a regional area can also be gruelling, even for those working in some of the country’s most essential industries — or so new research suggests.

On Thursday, social advocacy group Anglicare Australia released its third annual snapshot of rental affordability for those it classified as essential workers, saying its results showed finding an affordable place to live was “incredibly challenging” for Australians in those fields.

Accompanying its established rental affordability snapshot, a recent report examined over 51,000 rental listings nationwide, evaluating their affordability for 16 different essential worker categories. This assessment aimed to determine rental affordability for a single individual earning a full-time adult award wage in their respective occupation.

Among those categories were workers in the hospitality, aged care, childcare and construction sectors, as well as cleaners, firefighters, meat packers, nurses and school teachers.

According to Anglicare’s findings, cleaners face a stark reality in the rental market. They can afford less than 1% of available rental properties in regions like the Southern Highlands or Hunter Valley in New South Wales, as well as Central Queensland. This highlights a significant disparity in housing accessibility for those in essential roles.

The report underscores the challenges faced by essential workers, such as cleaners, in securing affordable housing within regional parts of NSW and Queensland. The data paints a concerning picture of the rental landscape, suggesting a need for policy intervention to bridge the gap between wages and housing costs.

Anglicare’s report found negligible change across all essential worker categories over the last year, with very little change in affordability across the board.

In particular, there were sharp declines in affordability for teachers and social and community service workers.

Among the 51,238 total listings surveyed, there were 417 affordable rentals for an early childhood educator, hospitality worker or nurse — 0.8 per cent.

School teachers had the highest number of affordable rentals available to them — 1,672, or 3.3 per cent — followed by firefighters at 1,651, or 3.2 per cent.

The report emphasised that “no part of Australia offers relief from the crisis”.

For hospitality workers, there were no affordable rentals among the listings in the ACT, five in the NT, and 80 across Victoria.

Anglicare’s report found a cleaner would be able to afford less than 1 per cent of rental properties in the Southern Highlands or Hunter Valley in NSW, or in Central Queensland.

Anglicare’s report found a cleaner would be able to afford less than 1 per cent of rental properties in some regional parts of NSW and Queensland. Source: Getty / shironosov

They would be able to afford less than 3 per cent in the regional Victorian city of Geelong, Cairns in Queensland, or in the outback regions of the NT.

The results, it said, disproved the “myth” that Australians struggling to find an affordable home in a capital city should simply move to a regional area where rent is cheaper.

The report said while many areas had experienced increases in affordability from last year, there were large swings in the opposite direction in others, with steep drops in outback Queensland and far-west NSW.

Anglicare chief executive Kasy Chambers said the private rental market was “failing” many ordinary Australians, who she described as the country’s “backbone” — those who performed the essential services required to keep it going.

And the issue, she said, was widespread.

“Right across the country, there’s nowhere basically where you have any good levels of affordability,” she told SBS News.

Chambers said that, while most people would assume the private rental market should serve “middle Australia”, the report’s findings showed it wasn’t doing that.

A lack of affordable rentals can also compound other cost-of-living pressures and scarce job opportunities, issues felt more intensely the further away one is from a major city, she said.

“We’re finding that more and more we’re having to actually provide housing to get workers, particularly to regional areas in aged care and things like that,” she said.

Are rents still cheaper in regional areas?

Whether they fall into the category of ‘affordable’ or not, median rents are still lower in regional parts of the country compared to the capital cities.

Property group Domain’s rental report for September showed typical weekly rent across the combined capital cities was $650, dropping down to $585 a week across the combined regional areas.

Year-on-year, Australia’s regional areas collectively experienced a 6.4 per cent increase in median rents, rising from $550 in September 2024.

Domain senior economist Joel Bowman said the “growth momentum” of rental prices was slowing in both capital cities and regional areas, but was doing so from a slightly higher level in the regions.

“If we’re looking at the most recent quarters, there are clear signs that rent growth is still slowing in the regional pockets by and large,” he told SBS News.

“For example, in regional New South Wales, regional South Australia and regional Western Australia, the median rents for houses did not grow in the September quarter compared to the June quarter.

“But the annual growth is still coming off that higher rate, given that we did see notable increases last year. But they’re starting to wash through. I think, by and large, affordability constraints are really capping the extent to which rents can increase in both the capital cities and the regions.”

Bowman said the slowdown was not due to supply, as vacancy rates remained very low across the board, including in regional pockets.

But he said landlords were struggling to increase rents, as renters were simply unable to pay for them.

“So it’s really those affordability elements that I think are capping those rent increases.”

In the meantime, though, unaffordable rentals will still be out of reach for the many in “ordinary” industries who are unable to pay for them — regardless of whether they’re cheaper than their equivalents in capital cities.

What can be done about unaffordable rentals?

Chambers pointed to several issues she said were contributing to a lack of affordability, including the precarious nature of housing for those in the private rental sector, meaning many renters moved house far more often than would be desirable.

Anglicare’s report called for stronger protections for renters and, in particular, a consistent national approach rather than the “patchwork of different rental laws” between states and territories.

Chambers said uncoupling wages from the private rental market was also necessary, as wage growth had failed to keep up with the cost of housing.

However, while Anglicare’s report suggested several possible solutions for addressing Australia’s rental affordability issue, it said those would do little without taxation reform.

It called for an overhaul of Australia’s tax system, including a phasing out of the Capital Gains Tax discount over the next 10 years, and a phasing out of negative gearing deductions for new investors in the private market.

“Without reforming these incentives, other solutions will be piecemeal efforts,” it said.