Renters dramatically cut spending in cost-of-living turndown

In a result that will surprise no-one renters are reining in their spending, bank data shows. 

The Commonwealth Household Spending Insights (HSI) report for April reveals that ‘challenges’ faced by renters have curbed their spending to an increase of just 1.3 per cent. 

That’s hardly surprising. Real estate data analysts CoreLogic reported that the national median rent ticked over to $601 per week this year, which represents an annual rent of $31,252. The annual median rent in 2020 was $437.

CBA chief economist Stephen Halmarick said the fall in April reflected an ongoing softening of household spending.

“Renters, in particular, have cut back, with spending just inching higher at 1.3 per cent over the year, while those who own their home outright experienced the strongest spending growth at 6.3 per cent annually,” Mr Halmarick said. 

It’s a result backed up by YourLifeChoices Retirement Affordability Index (RAI), which found that the Cash Strapped Singles (renters on the Age Pension) annual cost of living has increased by 4.1 per cent, far above the 3.6 per cent headline figure. Cash Strapped Couples (renters on the Age Pension) also saw their cost of living increase by 3.9 per cent.

“This was overwhelmingly driven by increases in rents, which made up about half of their cost-of-living increase, and is unsurprising when you consider rent has risen 7.8 per cent in the past 12 months,” RAI author Matt Grudnoff said.

“This is the highest growth in rents for 15 years. Worryingly, after a small slowdown last quarter, rental costs have started to accelerate again.”

Lagging behind

Spending by renters has lagged behind homeowners and owners with a mortgage since 2022, and the difference is only growing.

Renters have reduced spending on recreation, hospitality, food and drinks, and household services in the past year. 

The biggest category spending increases for both homeowners and homeowners with a mortgage are in insurance, health and utilities. 

CBA included home ownership for the first time in the April HSI report.  

Eight of the 12 HSI categories rose in April, led higher by significant increases in spending on education (up 3.7 per cent for the month), utilities (+2.5 per cent), and motor vehicles (+1.7 per cent).

However, this was more than offset by large falls in spending on food and beverages (down 3.8 per cent), hospitality (-3.3 per cent) and recreation (-2.6 per cent). 

Spending high

CBA said the large fall in food and beverages was partly attributed to coming down from a spending high in March for Easter, but there was also a marked decrease in spending in liquor stores, supermarkets, seafood, butchers and confectionary stores.  

“The April HSI paints a picture of constrained consumer spending following an early Easter bump in March,” Mr Halmarick said.

“Significantly, the annual rate of household spending has fallen from 3.9 per cent in March to 2.6 per cent in April, led by a large drop off in discretionary spending, which is down 4.4 per cent.

Victoria was also keeping a lid on spending. 

“Across the states, spending in Victoria continues to be subdued as NSW pulled away to sit with South Australia and Tasmania as the only states to post spending growth for the month,” Mr Halmarick said.

“Western Australia declined 0.2 per cent in April to lose its mantle as the strongest spending state over the year.

“We expect weak consumer spending and below-trend economic growth to continue throughout 2024, and despite recent inflation data surprising to the upside, we anticipate the RBA will cut interest rates in November this year.”

Victoria’s spending declined by 1.2 per cent for April, but was up 1.9 per cent for the year. In comparison, NSW spending was up 0.1 per cent for April and up 3.1 per cent for the year. 

The CBA compiles the HSI report using de-indentified payments from transactions including credit and debit cards, ATMs, BPay and home loan lending data from about seven million customers, which comprises roughly 30 per cent of Australian consumer transactions. 

Have you cut back your spending? What did you cut back? Why not share your experience in the comments section below?

Also read: Super funds report negative returns for April. What’s going on?

Jan Fisher
Jan Fisher
Accomplished journalist, feature writer and sub-editor with impressive knowledge of the retirement landscape, including retirement income, issues that affect Australians planning and living in retirement, and answering YLC members' Age Pension and Centrelink questions. She has also developed a passion for travel and lifestyle writing and is fast becoming a supermarket savings 'guru'.


  1. What can be expected for renters when the Landlords are being hit on every side. Firstly there is the increased mortgage rates that have risen greatly and the landlord cost with it. Also their Landlord insurance has gone through the roof, and just to add to that in Victoria the Land Tax increase on an average Melbourne house is adding a further $9000.00 a year to the Landlord’s cost.
    There is only one way to cover the cost increases and that is to increase the rent, however many investor landlords cannot reasonably expect to recover all the increases through rent.

    As a consequence we are seeing a large number of investment properties being sold, (37% of all sales last month in Victoria) predominately to homebuyers, and hence less homes being available too rent.
    This will of course make even more difficult for renters.

- Our Partners -


- Advertisment -
- Advertisment -