Higher-Income Households Struggle as Adelaide Rent Soars

Low-income earners are bearing the brunt of Adelaide's rental affordability crisis, which has hit a record-low, according to the tenth annual National Shelter-SGS Economics and Planning Rental Affordability Index.

Released today, the Index revealed low-income earners in Adelaide are facing increasing hardship as rental affordability continues to decline. People who are single and on JobSeeker are facing 'critically unaffordable' rents, while those on the Age Pension or working as a single parent are met with 'severely unaffordable' rents.

The city has hit a record low RAI score of 101, showing that people on low incomes simply cannot afford to rent in Adelaide.

For the first time, the average metropolitan rental household earning $91,601 per year would struggle to find an affordable rental, paying 30 per cent of their total income if renting at the median rate. This makes Greater Adelaide the third least affordable capital city in Australia for renters, despite having the cheapest median rent compared to other major cities.

Incomes in Adelaide increased by only 5.2 per cent in the year leading up to June 2024, but median rents surged by 14.1 per cent. While the CBD and inner-city suburbs offer slightly better affordability, largely due to smaller dwellings, even these areas have become more expensive, with areas deemed 'acceptable' last year now 'moderately unaffordable' in 2024.

CEO of Shelter SA Dr Alice Clark has welcomed the recent rental law reforms, but says there has been a missed opportunity to apply limits to how much rents should be increased, similar to the ACT.

"This has resulted in unaffordable increases in rents across South Australia, not only for low income households but for an increasing number of moderate and higher income renters," Dr Clark said.

"The state government's plans to build market homes for sale do not address the rental crisis or provide housing solutions for the majority of South Australians. Urgent action is required to address this. People who could once afford to rent in the private rental market are now resorting to staying in caravan parks and sleeping in their cars due to the lack of affordability."

"This is a devastating reality for the state. Rental affordability has dropped eight per cent in Adelaide and moving to the regions doesn't provide any relief. While regional SA offers the cheapest median rents of any region in the country outside a main city, affordability has continued to decline by 3%. The region is on the cusp of being Moderately Unaffordable.

"In regional areas, the average rental household is now paying 25 per cent of their income on rent, if renting at the median rate, which is a jump from 21 per cent in 2021. This adds even more pressure to rental households with a lower average income of $80,107 in the regions.

"The 2024 Index scores for SA clearly indicate that governments need to prioritise housing affordability solutions to ensure all renters have access to affordable housing."

* Table comparing each household in Greater Adelaide and their rent as a share of income, as well as RAI score and affordability.