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Alarming figures have revealed how much the average Australian would need to earn to rent in some of the country’s most sought-after suburbs, highlighting a widening gap between wages and average rental prices.
MGC Quantum Surveyors’ new report into rent disparity in Australia’s top 10 capital city suburbs has led to calls for action to address the “significant gap” renters face in light of skyrocketing rates.
Some of the most expensive areas require a household wage of more than $3,000 a week: the suburbs of Byron Bay in New South Wales and Mermaid Waters and Noosaville in Queensland require around 60 per cent of the average household income to be devoted to weekly rent just to live comfortably. .
Mike Mortlock, CEO of MCG Quantity Surveyors, said the figures reveal the “harsh reality” many Australians face.
“(It is) a reality in which the dream of living in a prime location is increasingly out of reach due to the growing gap between wages and rental prices,” he said.
Byron Bay, New South Wales, requires 60 per cent of an average income to go towards rent. Renters need a combined weekly income of $3,805 to live comfortably in the area
The top 10 suburban areas nationwide with the largest income gaps, along with weekly income required to rent and percentage of income.
‘When a significant portion of a household’s income is dedicated to rent, there is less availability for other expenses. This is not just a problem for tenants; It is a challenge for the entire local economy.”
In the report, titled Unaffordable Australia: The surprising income you need to rent comfortably, researchers used area median rents and then calculated what income was needed to equal the 30 per cent of household income allocated to rent, which was considers the benchmark for affordability.
This figure was then compared to the average national household income to find the wage gap.
The suburbs of Byron Bay, Suffolk Park and Broken Head top the national list, with more than 60 per cent of household income, or about $3,805 a week, needed for rent.
Queensland suburbs followed: Mermaid Waters (59 percent of revenue, $3,717 per week), Noosaville (62 percent of revenue, $3,099 per week), Runaway Bay (62 percent of revenue, $3,027 per week) and Benowa. (50 percent of income, $3,458 per week).
Noosaville, Queensland, was third on the list, requiring tenants to earn a combined salary of $3,099 to pay rent.
Renters in Melbourne CBD – North were among the worst off, with the report finding an average of $1933 a week, or 56 per cent of household income, was needed to live comfortably.
Those figures represent an income gap of -$747.41, according to the report.
In South Australia, Victor Harbor topped the list with an average required weekly income of $1,564 per week, representing around 44 per cent of household income.
Median rents were determined using consecutive 12-month sample periods, using 2021 census data.
The findings are a blow to an already competitive market that often sees potential tenants queuing up to view a property (pictured people looking at an apartment in Sydney)
“Key findings demonstrate that in places such as Byron Bay, Mermaid Waters and Noosaville, residents would need to substantially increase their income to be able to pay rent at a rate not exceeding 30 per cent of their income,” the report states.
Mortlock said the report’s findings needed to be considered as a call to action by policymakers and industry stakeholders.
‘We need innovative solutions to close this affordability gap. “It is imperative for the sustainability of our communities and the overall health of our economy,” he stated.