After years of rising rent prices, new data reveals the national rental market is finally slowing — offering long-awaited relief to millions of renters.
Domain’s latest Rent Report, released in partnership with Pepper Money, shows rental price growth has stalled across most major capitals, with house rents across the combined capital cities remaining flat for four consecutive quarters — the first time this has happened since 2019.
“Cost of living pressures have reached a tipping point,” said Domain’s Chief of Research and Economics, Dr Nicola Powell.
“Renters are maxed out and landlords are being forced to hold steady. We’re also seeing a shift in demand — renters are downsizing or choosing units to stretch their budgets, which is why unit rents are now rising faster than houses.”
The report shows Sydney, Melbourne, and Brisbane recorded their slowest June quarter growth in years, while Perth is now equal with Canberra as the second most expensive city to rent a house, following a modest $5 weekly increase.
Meanwhile, unit rents have hit record highs across all capitals and are now rising faster than house rents in every city except Melbourne.
This is being driven by affordability pressures and changing renter preferences, with many choosing smaller homes or apartments to manage costs.
Despite this shift, competition remains fierce in most markets. National vacancy rates sit below 2%, and Darwin has emerged as the tightest rental market in the country, with a vacancy rate of just 0.3%.
Looking ahead, Domain sees early signs that relief may be on the way, with increased investor activity and first-home buyer support expected to help ease supply pressures.
Pepper Money CEO Mario Rehayem said the current environment highlights the importance of flexible finance, particularly for those trying to enter the property market.
“For first-home buyers especially, the path isn’t always straightforward,” he said.
“Whether you’re navigating variable income, self-employment, or just beginning to save, it’s important to know that a variety of alternative financing options exist. Partnering with a broker or lender who truly understands your financial situation can make all the difference.”
The report suggests the rental market may be entering a new phase — one defined less by rapid price increases, and more by cautious tenants, price-sensitive landlords, and a renewed focus on affordability.
