Renters and homeowners are turning to the share accommodation market to alleviate the affordability pressures brought on by high rents and interest rates.
With weekly rents at an all-time high and vacancy rates at an all-time low, renters are under pressure to find somewhere to live while staying within their budget.
In December 2023, the total number of members on the share accommodation website Flatmates.com.au reached 181,500, an increase of 55,000 new members since December 2022.
Additionally, more homeowners with spare rooms have joined the site to make extra money, driving up new listings on the site by 35% year-on-year.
Flatmates.com.au community manager Claudia Conley said share housing demand had spread beyond typical peak periods.
"Peak season on Flatmates.com.au typically falls across January and February, but in 2023, we saw our busy summer period extend well into April as the demand for share accommodation remained high."
"December is usually one of our quietest months on the platform, but with a 22% increase in new members since the prior year and a 35% increase in new property listings, all signs show that this summer is going to be our busiest yet."
Affordability is the main reason that renters choose to live in a shared house rather than live alone.
Flatmate.com.au's latest survey, with more than 10,300 respondents from across Australia, reveals that almost half (48%) share because they can’t afford to rent independently, and 70% said they would prefer to live alone if they could afford it.
The weekly median rent nationally is $580, up 11.5% year-on-year, whereas the median weekly rent for a room in a share house is $290.
In Perth, the median rent has increased by 20% to $600 per week. In Sydney, where the median rent is $700 per week, new renters are looking at a 16.7% increase compared to December 2022.
This can be a significant increase for renters on a tight budget and can make renting unaffordable.
Many renters and homeowners have also found the higher cost of living a problem, and have listed their spare rooms to help pay the bills.
The survey revealed that of all respondents listing a spare room, two-thirds (67%) cited interest rate rises as the reason for doing so, while 86% said that they listed their home as a share house for financial reasons, including helping to pay off the mortgage and making additional income.
The tough rental market and ongoing affordability pressures have changed shared house demographics.
Renters looking for shared accommodation are no longer just students and those in their early twenties.
Members aged between 55 and 64 years old on Flatmates.com.au were the fastest-growing demographic in the past year, recording a 21% annual increase.
Those aged between 65 and 74 were the second largest growing demographic, rising 13% since last year’s survey.
Share accommodation will continue to be popular in the coming years while rental properties remain expensive, in short supply, and in high demand.