New data has unveiled the suburbs in the Territory that are experiencing the highest levels of rental stress, with six areas facing extreme pressure. According to the most recent Rental Pain Index by Suburbtrends, the Northern Territory has one of the least stressed rental markets in the country. However, it is worth noting that over 15 percent of suburbs in the region are experiencing extreme rental pain.
The analysis examined various factors, including rent changes, advertised rents, vacancy rates, vacancy change, and rental affordability, to determine the level of rental stress. The March report revealed that six suburbs in the Northern Territory, out of 36, were experiencing significant rental difficulties, with a Rental Pain Index (RPI) exceeding 75 out of 100. At the top of the rankings was Leanyer, a suburb with an RPI of 89.
In the past year, the northern suburb saw a notable 9% rise in rental prices. Additionally, it experienced a low vacancy rate of 0.33% and a rental affordability score of 24%, indicating the percentage of household income required for rent. Coming in second was Karama, boasting an impressive RPI of 88. They attributed this to its 4% annual rent increase, low 0.48% vacancy rate, and commendable 28% rental affordability.
Larapinta, a suburb in Alice Springs, has seen a significant increase in rent over the past year, with an average increase of 7%. The vacancy rate in the area is relatively low, at 1.45%, and rental affordability is at 25%. With an RPI of 83, Bakewell, Rapid Creek, and Larrakeyah completed the top six.
ACT had the second-lowest percentage of suburbs experiencing extreme rental pain, with a score of 5.26 percent. A significant majority of suburbs across the country are currently facing severe rental pressure.
Rental stress is a significant issue in various regions across Australia. Western Australia has the highest percentage of suburbs in the extreme category, followed by South Australia, Queensland, Victoria, New South Wales, and Tasmania.
The overall RPI for the NT was 59.06, placing it below ACT (47.64) but above Tasmania (62.47), Victoria (79.21), New South Wales (79.27), South Australia (82.57), Queensland (82.63), and Western Australia (84.29). The national RPI stood at 78.62.
According to Kent Lardner, founder of SuburbTrends, the most recent Rental Pain Index reveals a concerning pattern of increasing rental stress. “Western Australia and Queensland now lead the nation in rental hardship, with the majority of their suburbs facing unprecedented levels of stress,” he said.
“This is not just a market fluctuation; it’s a clear signal of a deepening crisis that requires immediate attention.”
According to Lardner, the Rental Pain Index indicates that the increasing affordability pressure is causing a chain reaction, which could lead to a significant rise in homelessness among the most vulnerable households by the end of the year.
“The data demands not just our attention but immediate action to prevent a social disaster,” he said.
Lardner emphasised the need for immediate policy innovation to address the situation.
“The current data compels us to rethink our approach to housing,” he said.
“Considering the success of mobile home villages in providing affordable housing solutions internationally, it’s crucial for Australia to explore similar alternatives.
“Prefabrication technology could be a game-changer, offering quicker, more affordable housing options to combat the rental crisis.”
NT suburbs with the highest rental pain index
- Leanyer – 89 RPI
- Karama – 88 RPI
- Larapinta – 85 RPI
- Bakewell – 83 RPI
- Rapid Creek – 81 RPI
- Larrakeyah – 81 RPI
- Coconut Grove – 74 RPI
- Mount Johns – 72 RPI
- Moulden – 72 RPI
- Fannie Bay – 72 RPI
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