Renting a house in Australia’s capital cities increasingly requires an income above A$100,000 as rents rise faster than wages, according to a Domain report.
The income needed to rent a typical capital city house has increased 51% to $112,667 over the past six years, the report found. Individual average annual wages are $80,200.
“Australia enters 2026 with renters facing a widening gap between the suburbs they aspire to live in and the incomes required to secure them. Rents have risen faster than wages across every capital city, vacancy rates remain critically low, and location has become the defining driver of affordability, lifestyle and choice,” according to the report.
The annual income needed to rent a median-priced house without spending more than 30% of earnings on rent is now above $100,000 in every capital city, with Sydney leading at $135,200. Melbourne and Hobart have the lowest required income, both at $100,533.
The share of income a two-person household earning average wages would spend on renting a house has risen in all capital cities except Hobart since 2019, and is now at 21.1%. Sydney’s share is the highest at 24.5% of income, while Perth has seen the largest increase from 13.9% to 21.8%.
Price differences between renting a median-priced house and renting a unit are widest in Darwin, at more than $24,000, while Melbourne's gap is the smallest at roughly $900.
Australia's five most expensive suburbs are in Sydney’s east and north, including Vaucluse, Dover Heights, and Double Bay. In Vaucluse, the annual income needed to rent comfortably would be $511,333.
The most affordable suburbs in all capital cities are typically 30-40 kilometres from the CBD, the report found.
In regional areas, meanwhile, the annual income needed to rent a typical house without spending more than 30% on rent is $101,400.
Rental vacancies reached a record low in 2025’s third quarter, according to Cotality, with median weekly rental value at $702 per week across capital cities. This is due to limited supply, as rental listings were around 25% below the Q3 five-year average.
National dwelling rents also rose by 1.4% last quarter, its greatest quarterly increase since 2024’s Q2.
