Annual rents in some suburbs exceed the average first-home buyer deposit
An annual rental price in the country’s most elite suburbs now rivals or exceeds the average deposit needed for a first home, new data from Domain shows.
The Domain Rent Report for the March quarter revealed that all of the top 10 most expensive suburbs to rent a house in Australia are located in Sydney, despite the city posting its weakest house rental growth since 2019. The highest median rent was recorded in Dover Heights, with house rentals averaging $2,823 per week, equating to nearly $147,000 per year.
This yearly rental cost surpasses the average deposit of $131,500 typically saved by first-home buyers, according to research by financial comparison platform money.com.au.
Real estate professionals say the headline rental figures only tell part of the story. Jamie McCarthy of Management Co. Property Management Specialists noted that actual weekly rents in these high-end areas often range from $3,000 to $50,000.
“The average listing for me is generally between $3,000 to $6,000,” he said. “Sometimes we’ll get an $8,000 or $10,000 a week property … and very rarely, I’ll get one for $50,000.”
McCarthy said many of his clients are senior business figures with families seeking proximity to private schools such as Cranbrook, Kambala and The Scots College.
“Areas like Rose Bay and Bellevue Hill seem to be popular because of the local schools,” he said. “That’s what’s driving them to those areas, and it seems to be driving the rent prices up.”
He added that luxury homes in these pricy suburban areas often feature premium amenities, including waterfront access, guest quarters for staff, and high levels of privacy.
One Rose Bay property listed at $5,000 per week features five bedrooms, three bathrooms, a pool, koi pond, landscaped garden and three-car garage — just minutes from the marina.
Grant McKay of NU Management said that while homes listed below $2,000 per week are available in these suburbs, tenants can expect fewer high-end features. For a house with waterfront views, he said weekly rents typically sit between $4,000 and $5,000.
One standout property currently on Domain is a Vaucluse heritage home styled after an Italian palazzo, with views of the Sydney Opera House and Harbour Bridge, available at $4,500 per week.
Desirable family homes, McKay noted, typically offer large internal space, four or more bedrooms, modern finishes, and possibly a swimming pool. However, many of these luxury leases are short-term arrangements, often made by individuals between home purchases or amid renovations.
“We’re getting people who have sold their properties and don’t necessarily know what the next chapter holds,” he said. “We’re also getting people who are doing a major renovation, so they want to rent for two or three years.”
Despite the broader market’s low vacancy rates, competition for these top-tier rentals remains subdued, McKay noted. “You’re not getting inundated with inquiries that you are at different price points,” he said.
That lack of demand means those in the market for high-end rentals are often able to inspect properties without the crowds typically seen in other segments.
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
