The RBA says a rate of 3 per cent will cause rents to rise with inflation.Australian tenants have not experienced a renters’ market in the past 20 years, other than during COVID lockdowns in some cities, which have baked-in market conditions that contribute to the rental crisis, experts say.
The national vacancy rate was 1.2 per cent in May. In Sydney, it was 1.4 per cent and in Melbourne, it was 1.3 per cent. Nationally, rates have remained below 2 per cent since late 2021. “You’ll see some people say rent are back to where they were before COVID, but they’ve well and truly gone past that.”
Tenants Union NSW chief executive Leo Patterson Ross said a vacancy rate of 3 per cent was typically considered healthy because the Reserve Bank had determined it would allow rents to rise in line with the Consumer Price Index. Patterson Ross said it was rare for the rental market to enter a tenants’ market, like what was seen in major cities during the lockdown periods.