In this week’s Property Insider program, Dr Andrew Wilson breaks down the latest figures from the rental market, revealing a sharp tightening across the nation over the past month—placing renewed upward pressure on rental prices.

We’ll also explore current trends in consumer spending and take a look at how Melbourne has surged ahead in auction clearance rates, despite the interruptions of the long weekend.

Rental markets under pressure

Tune in to this week’s Property Insiders chat, where Dr Andrew Wilson breaks down how rental markets across the capital cities tightened throughout May. This shift reflects a rise in demand, with all capitals recording lower vacancy rates—bouncing back after the typical slowdown in April brought on by the extended holiday period.

House rental vacancies tighten further as rents continue to climb

Vacancy rates for houses fell across all capital cities in May, with levels remaining low and well below 2%. This points to a shortage of available rental homes and is likely to keep pushing rents higher.

Darwin, Hobart, Adelaide, and Canberra all saw increases in median asking rents for houses in May compared to April, while rents held steady in the other capitals.

Sydney remained the most expensive capital for house rentals in May, unchanged at $800 per week. Hobart continued to be the most affordable, though rents there also rose to $581 per week.

Most capital cities have seen strong annual growth in house rents. Adelaide led the way with a 5.8% increase, followed by Brisbane and Hobart (both up 5.6%), Canberra (up 5.5%), and Perth (up 4.5%). Brisbane saw a more modest rise of 1.6%.

However, Melbourne and Sydney both experienced annual declines in house rents, falling by 1.7% and 2.3% respectively.

Unit rental markets tighten further across the capitals

The unit rental markets in capital cities tightened notably in May, with vacancy rates dropping across the board—most sitting well below 2.0%.

Adelaide led the way last month with a 3.8% jump in unit rents, followed by Perth (up 2.7%), Canberra (up 2.6%), and Brisbane (up 0.4%).

Rents for units in Sydney and Melbourne held firm over the month, while Hobart saw a drop of 1.5% and Darwin recorded the biggest monthly fall, down 4.3%.

Over the year to May, unit rents have risen sharply in several cities, with Adelaide up 11.1%, Hobart 9.2%, Melbourne 7.3%, and Perth 7.2%. Darwin also recorded an annual rise of 5.3%, Canberra 4.9%, and Brisbane 1.4%. However, Sydney saw a 2.0% decline in unit rents over the same period.

Sydney continues to command the highest weekly unit rents, steady at $750, while Hobart remains the most affordable capital, at $491 per week.

Retail sales ease in April as consumer caution lingers

Tune in to this week’s Property Insiders chat, where Dr Andrew Wilson breaks down the latest retail data. Retail sales dipped slightly by 0.1% in April, though they remain 3.8% higher than this time last year.

Household spending is still growing, but only at a sluggish pace—underscoring that, even with some relief on interest rates, Australians are continuing to spend cautiously.

This trend mirrors recent consumer sentiment surveys, which reveal that overall sentiment remains subdued. However, with interest rates expected to trend downward throughout the year, confidence may gradually lift.

While spending on services has shown strong growth—driven by ongoing high services inflation—it’s clearly leading to cutbacks in other areas of consumer expenditure.

Melbourne leads auction results over the long weekend

Auction markets continued to deliver mostly solid outcomes last week, despite the usual disruptions from the King’s Birthday long weekend, which is observed in most states.

Melbourne stood out, showing clear signs of renewed strength, with the highest auction clearance rate of all the capital cities over the past week.

Nationally, the weekend auction clearance rate came in at 64.3%, slightly down from 65.3% the week prior and lower than the 67.1% recorded during the same week last year.

With the holiday period now behind us, housing markets are expected to pick up pace in the week ahead, with a noticeable lift in listing activity—particularly across Sydney and Melbourne.