An increasing number of Victorians are being smashed by the rental crisis, with new analysis revealing asking weekly rents have increased by more than $100 in some areas since interest rates started rising.
Community Housing Industry Association Victoria has analysed Victoria’s top ten hotspots for rental increases since the RBA started lifting interest rates in May last year.
Inner East Melbourne tops the list with tenants paying $111 extra in rent per week since May – a 22.3 per cent increase. Regional Victoria is also feeling the pinch, with renters in North East Victoria paying an extra $36 a week.
Vacancy rates across Victoria remain well below two per cent making it even harder for renters to find a home, much less one they can afford.
The analysis comes as CHIA Victoria launches its budget submission for the Victorian Government, which includes a call for $6 billion for a Social Housing Investment Fund to provide a long-term funding pipeline for social housing growth.
Region | Asking weekly rent start of May 22 | Asking weekly rent start of March 23 | Increase in weekly rent $ and % |
1. Inner East Melbourne | $497 | $608 | $111 or 22.3% |
2. Melbourne City | $515 | $627 | $112 or 21.7% |
3. Eastern Melbourne | $467 | $559 | $92 or 19.7% |
4. Bayside | $533 | $620 | $87 or 16.3% |
5. Melbourne North | $437 | $493 | $56 or 12.8% |
6. Western Melbourne | $396 | $445 | $49 or 12.4% |
7. North West Melbourne | $406 | $451 | $45 or 11% |
8. South East Melbourne | $442 | $486 | $44 or 10% |
9. North East Victoria | $385 | $421 | $36 or 9.4% |
10. Mornington Peninsula | $500 | $535 | $35 or 7% |
*based on SQM Research Weekly Rents Index – combined units and houses – sourced 14 March 2023
CHIA Victoria acting chief executive officer Jason Perdriau said as a matter of urgency, the Victorian Government must significantly top up its investments in social housing.
“A lack of affordable housing supply is a primary driver for soaring rents in Victoria. But the rise in interest rates isn’t helping right now. Landlords can pass on their financial pain to tenants. On top of this, higher interest rates are softening the demand for new housing construction,” Mr Perdriau said.
“The most effective solution to create more housing supply for Victorians who need it most is by increasing the number of social and affordable houses. Now’s the perfect opportunity for the Victorian Government to commit to a $6 billion Social Housing Investment Fund as its historic Big Housing Build winds down, and more Victorians experience housing stress.
“Victoria has the lowest proportion of social housing in the country. Meanwhile, three areas within Melbourne are among Australia’s top ten regions with the highest number of households facing unmet need.
“An investment of $6 billion will deliver 20,000 social homes over the next decade – a third of what’s required to hit Infrastructure Victoria’s recommended target. This boost would make a huge difference to many Victorians who are doing it tough.”
