Following a brief slowdown in late 2024, rental growth has regained momentum—highlighting ongoing pressures in the housing market and reinforcing the investment case for residential property.

PropTrack reports a 1.6% rise in national rents for the March 2025 quarter, pushing the median weekly rent to $630.

This marks a 5% year-on-year increase, adding approximately $1,560 in annual rental costs for tenants.

REA Group economist Anne Flaherty commented, “The speed at which rents are rising has picked up… reversing the trend of slowing growth seen late last year

Apartments are leading the growth, with unit rents climbing 3.2% in capital cities and 3% in regional areas—suggesting renewed borrower interest in higher-density dwellings, particularly in urban centres.

In contrast, house rental growth was more subdued, further underscoring the shift in tenant preferences amid affordability constraints.

Capital cities, especially in Queensland and South Australia, have driven the latest gains.

Sydney remains the highest-cost market, with renters paying $70 more per week than those in Perth and $9,100 more annually than in Melbourne.

These disparities may prompt regional portfolio diversification among property investors and lenders alike.

Despite recent growth, Flaherty forecasts a more moderate pace of rental increases for the remainder of 2025.

Nonetheless, affordability pressures persist, with national rents up 14.2% over the past two years—well ahead of inflation—highlighting the need for tailored lending solutions and risk-adjusted pricing strategies in a tightening rental landscape.