Australia's sharpest residential rent increases were in Sydney and Darwin in 2010, according to the Australian Bureau of Statistics figures released this week.
The strongest capital city rent increases were in Darwin (6 per cent), Sydney (5 per cent), Canberra (4.8 per cent) and Adelaide (4.4 per cent).
Cities with lower than the average rent increases were Melbourne (3.8 per cent), Hobart (3.6 per cent), Perth (3.3 per cent) and Brisbane (2.9 per cent).
The weighted average increase for the eight capital cities was 4.2 per cent, while inflation generally rose 2.7 per cent through the year.
Property development industry group The Urban Taskforce's chief executive, Aaron Gadiel said, “Sharp rent increases are a classic sign of housing shortages”.
"It's clear that the greatest disconnect between the needs of households and the supply of homes is in Sydney, Darwin and Canberra."
"Unfortunately, the first victims of any housing shortfall are renters," Gadiel said.
"Yet they have to bear the burden of a national housing shortfall that is projected to grow to 308,000 homes within four years."
Gadiel said that a rising share of the population is being priced out of the housing market, and that the housing shortage was a direct consequence of Australia's town planning laws.
"It's not surprising that Sydney has seen the strongest increases in rents, because NSW is widely regarded as having the worst planning system across the nation," he said.
"The planning system's sweeping prohibitions and restrictions, together with inefficient infrastructure charges, have crippled Australia's housing supply."
Gadiel said that there was a shortage of detached housing in outer suburbs, as well as apartments in the inner suburbs of major cities.
