Despite annual gains, rents have held steady over the past three months, suggesting that tenants may be reaching their financial limits.

Launch Housing has reported a near doubling of requests for immediate rental support since 2020, driven by rising rental prices and the cost-of-living crisis.

The compromises tenants are making often lead to longer commutes, reduced leisure time, and potential health impacts from living in lower quality housing.

Dr. Nicola Powell from Domain noted that while quarterly growth in rents is at its weakest in four years, the rental market remains challenging, with a vacancy rate of just 1.1%.

In response to soaring rents and the ongoing cost-of-living crisis, many tenants are relocating to more affordable suburbs or making compromises on their housing arrangements.

Leo Patterson Ross, CEO of the Tenants Union of NSW, highlighted that insufficient income growth forces renters to balance location and housing quality.

Diana Mousina, AMP's deputy chief economist, predicts a slowdown in rental growth, although she does not foresee a decrease in rents due to ongoing affordability pressures.

Sydney's median asking house rent has reached a record high of $775 per week, reflecting a 2% increase in the September quarter and a 7.6% rise year-over-year.

Unit rents in Sydney have remained steady at $720 a week, with a 5.9% increase over the past year.

The low rental vacancy rate of 1.3% in Melbourne indicates a landlord's market, underscoring the imbalance between supply and demand.

Melbourne's rental market is also feeling the pressure, with the weekly median asking rent for houses hitting $580, up $30 from last year.

In Melbourne's outer areas, house rents have surged by double digits, with unit rents increasing between 10% and 15.6%.