Unity Jackson-Muir, Real estate reporter
First published 30 Oct 2026, 8:00pm
Sydney rents have soared since the government introduced federal tax reforms in the budget, with over half of the city’s rents overshooting Treasury projections.
Exclusive realestate.com.au figures have revealed rents have shot up by $200 a week in some areas, with the median Sydney rent sitting at $800 per week at the end of last quarter.
The Treasury released estimates in May projecting that the negative gearing and capital gains tax reforms would only push rents up by $2 per week.
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Over half of Greater Sydney has seen rents grow by more than $2 a week with 35 per cent of all houses now an extra $20 per week. Picture: Liam Kidston
Apartment rents climbed by more than $2 a week in about 60 per cent of Greater Sydney’s suburbs over the past three months, the first full quarter of rent measurements since the budget.
Rents for houses went up by over $2 a week in 55 per cent of the city, with most seeing rises well above $20 a week.
Senior economic analyst for REA Group Megan Lieu said rental availability has dampened price growth but that rents aren’t expected to moderate without a large increase in new supply.
“With the new budget policies coming into play, we could see investor activity decline and that could have an impact on rent prices too,” Ms Lieu said.
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Nikki Schmidt suspects her $100 per week rental increase can be blamed on recent tax reforms. Picture: Sam Ruttyn
Nicole Schmidt is a renter from The Central Coast who received a 20 per cent rental increase of $100 per week earlier this year and said it will push her family out of their community .
The single mother of two has been living in her three-bedroom home since 2019 and said she blames the tax reforms because the timing of her rental increase seems too coincidental.
“For so long, people were happy to sort of look at other people and say ‘well, it must be something that you’re doing, because it couldn’t possibly be the government doing this to us’,” Ms Schmidt said.
“I think it’s becoming so obvious that it’s not just personal failures anymore,” she said.
The latest quarterly data shows median house rents in Ms Schmidt’s suburb of Ourimbah rose 5.9 per cent in three months and jumped by $40 to reach $720 a week.
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Rents for Barangaroo houses jumped 15.6 per cent over three months and units in grew by 5.6 per cent. Picture: NCA NewsWire / Gaye Gerard
Barangaroo rents went up by $250 a week for a house and $100 per week for a unit, ranking it as the suburb with the third biggest quarterly jump for houses and biggest increase for units.
The quarterly figures show rents are highest in the traditionally sought after areas like the eastern suburbs but even Warrawee in North Sydney saw house rents jump by $220 per week.
The most resilient suburbs were concentrated in Sydney’s inner west and south west including in Canada Bay and Wareemba where median rents for a house dropped by $150 per week.
Coogee is one of the suburbs in the middle of the pack but still saw median rents grow by 2 per cent, equivalent to an extra $33 per week for a house and $20 per week for a unit.
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Sydney rents are the least affordable in Australia. Source: REA Rental Report September 2026
Ben Hartley was paying $570 per week for a Coogee apartment in 2023 and most recently received a $110 rental increase that brought his weekly rent up to $900. Mr Hartley said his landlord blamed the increase on recent interest rate rises.
As a landlord himself, Mr Hartley said that rate rises were, “already factored into my investment decision … and I’m not going to ring my property manager and say I need to increase the rent.”
Chief economist for the Housing Industry Association, Tim Reardon said the full impacts of the tax reforms wouldn’t be felt until around 2028, with the worst yet to come for renters.
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HIA chief economist Tim Reardon said recent tax reforms will drive up rental prices but that it is unlikely to be reflected in the latest quarterly data. Picture: Tertius Pickard
“What we’re seeing at the moment is the consequence of a lack of investment in new home building over the previous decade or two,” Mr Reardon said.
Mr Reardon said that ”the majority of new home building comes from investors” and a pullback from investors wouldn’t result in fewer homes until 2027 at the earliest.
He said that rents and home price growth won’t slow down until building a new home is cheaper than buying an established home.
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Investors build the majority of new homes and are expected to drive down building activity as they flee the market following recent tax reforms. Picture: NCA NewsWire / Gaye Gerard
A spokesman for housing minister Clare O’Neil acknowledged that rising rents are putting “enormous pressure” on Australians but said new supply is essential for easing that pressure.
“The fundamental problem is that Australia does not have enough homes,” the spokesman said.
“Low vacancy rates leave renters competing for too few properties, which is why our government is focused on building more homes.
“The latest figures show 248,733 homes under construction across Australia – the highest number since records began – with completions up 15.9 per cent over the year to the June quarter,” he said.
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Treasurer Jim Chalmers said on Wednesday that he takes responsibility for the pressure that his tax reforms put on the government. Picture: NewsWire / Martin Ollman
Treasurer Jim Chalmers said on Wednesday that previous governments didn’t make any economic reforms and left the Labor government to do “some of this difficult stuff”.
“If economic reform or tax reform was easy, our predecessors would have done something,” Treasurer Chalmers said.
The Treasury department was contacted for comment but did not reply before the deadline.
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