Canberra’s rental market experienced a modest increase in the final quarter of 2024, reflecting a broader national trend of slowed rental growth, according to CoreLogic’s Quarterly Rental Review for January 2025.
In the last quarter of 2024, Canberra’s rent values increased by 0.6%, bringing the median weekly rental value to $667. Despite the rise, this growth was moderate compared to previous years, reflecting the smallest Q4 change in national rents since 2018. Canberra’s vacancy rate stood at 2.5%, providing a slight relief for renters compared to the tighter conditions seen in other capitals.
Gross rental yields in Canberra edged up slightly to 4.1% for the year ending December, compared to 4.0% the previous year. This incremental increase reflects the overall stability of the market.
Diverging rental trends were evident across Canberra’s suburbs. The most expensive suburb for houses was Ainslie, with a median weekly rent of $940, while Belconnen remained the most affordable at $575 per week. For units, Forrest topped the list with a median weekly rent of $693, while Lyons offered the lowest rent at $497 per week.
Nationally, rent values rose by 0.4% in the December quarter, reflecting a significant slowdown compared to previous years. Annual rental growth across the country eased from 8.1% in 2023 to 4.8% by the end of 2024. This deceleration is attributed to a combination of supply-side improvements and easing demand pressures.
Supply factors include a notable rise in investor activity, with new investor lending up by 26.3% over the year to September 2024. Simultaneously, demand has softened due to a decrease in net overseas migration and the formation of larger share households to manage rental costs.
Among capital cities, Perth recorded the strongest annual rent increase at 8.1%, while Canberra saw the lowest growth at 2.6%. Melbourne experienced a decline in rents, dropping by 0.5% in the last quarter of the year.
The national vacancy rate eased to 1.9% by the end of 2024, up from a record low of 1.4% in November 2023. Despite this improvement, rental affordability remains a significant challenge, with the national median rent now consuming around 33% of a median household’s pre-tax income.
As Canberra continues to navigate its rental market dynamics, the slight uptick in vacancy rates and gross yields suggests a stabilising market. However, affordability concerns persist, reflecting broader national challenges in the rental sector.
