According to new analysis from the Real Estate Institute of NSW (REINSW), Sydney’s median weekly rent has reached $807, representing 33.7 per cent of the average household income – exceeding the 30 per cent threshold typically used to define mortgage stress.
REINSW calculated that the average weekly household income in Sydney currently stands at $2,393, based on 2021 Census data adjusted for wage growth.
With rents consuming more than a third of this income, tenants face significant financial pressure.
REINSW CEO Tim McKibbin said the figures highlight the severity of Sydney’s rental crisis.
“When viewed through this lens, the true extent of Sydney’s rental crisis becomes even clearer,” Mr McKibbin said.
The rental shortage is visibly apparent in the market, with large numbers of prospective tenants competing for limited available properties each weekend.
“The rental crisis is apparent in the huge queues of hopeful tenants who line up each weekend in the hope of securing a home,” Mr McKibbin said.
“It’s also apparent in the proportion of income tenants who are lucky enough to have a home must spend on rent.”
The situation appears likely to worsen as both rental prices and property values continue to increase, driven by strong competition for limited housing stock.
This creates a double challenge for renters – they face immediate financial pressure from high rents while simultaneously watching homeownership move further out of reach as property prices climb.
“Tenants on average must commit over a third of their income to keep a roof over their head,” Mr McKibbin explained.
The REINSW analysis comes after Cotality’s Quarterly Rental Review showed Sydney rents increased 1.5 per cent in the most recent quarter, continuing the upward trend that has characterised the market.
Industry experts warn that without significant intervention, the situation could deteriorate further, trapping more renters in a cycle of financial stress while preventing them from building equity through homeownership.
Mr McKibbin called for urgent policy solutions to address the crisis, emphasising the need for increased housing supply and investment incentives.
“The Sydney rental market urgently needs a significant injection of more rental properties and this requires radical policy solutions which encourage the fast-tracked delivery of new housing supply and more residential investment,” he said.
