Melbourne’s rental market remains at historically competitive levels with rents high and vacancies low, but is showing the first signs of loosening, or stabilising. The cost of living is still high, and economists predict the CPI to rise when Trump’s international tariff escalation takes hold, which will challenge renters and stabilise rents.

That said, it remains a golden age to be a lessor, with historically good returns on investment properties. This seems certain to remain the case until a significant increase in housing supply occurs – something routinely promised by politicians but not, so far, delivered. The government has used another lever to affect the market by imposing a short-stay levy of 7.5% on Airbnb rentals with the aim of encouraging landlords to transition their properties back to long-term leasing. This came into force in January.