How Much Higher Can Brisbane’s Rent Prices Go?

Brisbane’s rental market has undergone a dramatic transformation, with prices rising sharply over the past few years. For average income earners, the question now is: how much more can rents increase before they become unaffordable? To answer this, we need to examine disposable income levels, current rent-to-income ratios, and the potential ceiling for rental price growth.

Current Income vs. Rental Costs in Brisbane

As of late 2024, the average full-time salary in Brisbane is around $77,000 per year or approximately $1,481 per week. While this is lower than the national average of $102,648, it still reflects a solid middle-income wage. However, the city’s rising rental costs are eating into disposable income at an alarming rate.

• Median rent for houses: $625 per week (+5.9% YoY)
• Median rent for units: $590 per week

For someone earning the average wage in Brisbane, this means rent alone now consumes about 42% of their gross income, well above the widely accepted 30% affordability threshold.

The Increasing Financial Strain on Renters

A decade ago, Brisbane’s rental market was far more affordable. However, recent data shows a staggering 17.4% annual increase in median rent for new tenancies—the highest jump in over 10 years.

The financial stress is further highlighted by the shift in affordability zones. Just four years ago, renters could find affordable housing within 10-15 km of the Brisbane CBD. Now, they must move nearly 20 km away to find rent that takes up less than 30% of household income.

Can Brisbane’s Rent Prices Keep Rising?

While demand for housing remains high due to migration, housing shortages, and infrastructure growth, the capacity for further rent increases is becoming limited. Here’s why:

1. High Rent-to-Income Ratio – With renters already spending over 40% of their income on housing, further increases could push more households into financial distress, limiting landlords’ ability to raise rents without losing tenants.
2. Reduced Disposable Income – As rent takes up more income, spending in other sectors of the economy declines, potentially slowing down economic activity.
3. Migration to More Affordable Regions – If rental prices rise too much, people may start relocating to cheaper areas, reducing demand and stabilising rent growth.
4. Government Intervention – As affordability worsens, policies such as rental caps or subsidies could be introduced, further limiting how high rents can go.

What Does This Mean for the Future of Brisbane’s Rental Market?

While rents may still rise in the short term, the market is approaching a ceiling where affordability constraints will slow down further increases. Investors and landlords will need to balance higher rental yields with tenant affordability, as pushing rents too high could lead to increased vacancy rates and reduced long-term returns.

For renters, the challenge will be finding ways to manage costs, whether by moving further from the CBD, sharing housing, or exploring alternative rental arrangements. Meanwhile, government and industry leaders must consider strategies to increase housing supply and prevent Brisbane from becoming unaffordable for the average worker.

In conclusion: Brisbane’s rental market still has upward pressure, but affordability limits suggest that rental growth may soon hit a plateau. Investors should remain mindful of income constraints, and renters should plan strategically for the evolving market conditions.

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