What’s driving the rise in rent arrears – and what can property managers do about it?

Rent arrears are back in the headlines – and not in a good way.

For property managers, it’s becoming harder to ignore the trend: more tenants are falling behind on payments, and the traditional methods of managing arrears just aren’t cutting it anymore.

With rising interest rates, cost-of-living pressures, and market volatility, it’s no surprise that arrears are becoming one of the biggest challenges across Australian rent rolls.

But here’s the good news: understanding the “why” behind the issue puts you in a stronger position to act – and with the right tools and strategies, you can reduce arrears while supporting both tenants and landlords.

Why are rent arrears on the rise in 2025?

Let’s break down what’s really going on:

1. The cost-of-living crunch

Renters are being squeezed by higher grocery bills, energy prices, and transport costs – meaning rent sometimes slips down the priority list.

2. Rental price hikes

In many metro and regional areas, rent increases haven’t slowed down, and that’s placing extra pressure on lower-income tenants.

3. Wage stagnation vs rent growth

While rent has risen rapidly in the last two years, wages haven’t kept up – creating an affordability gap that’s hard to bridge.

4. Manual arrears processes

Many agencies are still using outdated or reactive systems that don’t flag issues until tenants are always weeks behind.

5. Communication breakdowns

Without clear, consistent follow-up, tenants can quickly fall through the cracks.

Curious why arrears are getting harder to manage?

It’s not just you – tenants are feeling the pinch more than ever. Our State of the Australian Real Estate Market report breaks down what’s really going on, from rental stress to rising landlord expectations.

It won’t give you any arrears stats specifically, but it will help you understand the bigger picture – and why now’s the time to rethink how you’re managing rent collection.

How can property managers respond proactively?

How do I reduce rent arrears in my portfolio?

Start with automation. Tools like Console Cloud’s arrears workflow let you trigger reminders automatically – so you’re not chasing tenants manually or missing early warning signs.

Better still, these workflows can trigger a series of predefined actions to resolve them.

Explore arrears automation in Console Cloud →

What’s the best way to handle late-paying tenants?

It comes down to early, empathetic communication. Templates and scheduled reminders help you keep messaging consistent – without adding extra admin.

If you’re using Console Conversations, you can stay on top of tenant replies without digging through email chains.

How do I educate landlords about arrears risks?

Landlords want transparency, especially in a shaky economy. Show them you’ve got things under control by sharing regular arrears reports – and explaining the steps you’re taking.

You don’t have to overcomplicate it. A quick dashboard export or summary from Console Cloud can go a long way in building trust.

5 rent arrears strategies that actually work

Here’s a quick-fire list of what leading property managers are doing:

1. ‍Set up automated payment reminders so tenants never miss due dates.‍
2. Track partial payments, which often signal deeper financial issues.‍
3. Segment tenants into risk categories and act faster with high-risk cases.‍
4. Use data to guide conversations – it’s easier to have tough chats when you’ve got facts.‍
5. Offer tenants flexible comms channels so they can reach out before things get out of hand.

Want to dive deeper into automating arrears?

If you’re ready to stop chasing overdue rent and start managing it smarter, we’ve put together a practical guide just for you.

Download the Arrears Workflow eBook – it breaks down exactly how to:

• Set up automated reminders that actually work
• Reduce human error (and stress)
• Customise your workflows for your agency’s needs
• Get better visibility into arrears trends across your portfolio

Think of it as your step-by-step guide for reducing arrears, improving communication, and reclaiming time in your day.

FAQs

What causes rent arrears in Australia?

Common causes include rising living costs, rent increases, stagnant wages, and outdated arrears management processes.

How do property managers mange rent arrears efficiently?

By using automation tools, staying proactive with communication, and reviewing tenant payment patterns regularly.

Is it legal to charge late rent fees in Australia?

It depends on your state or territory. Always check your relevant tenancy legislation or speak with your legal team.

It’s not just about chasing late rent

When you shift from reactive to proactive arrears management, you change the whole conversation. You’re no longer just a rent collector – you become a trusted advisor who helps landlords protect their income and supports tenants before things spiral.

Want to put a smarter arrears strategy in place? See how Console Cloud’s automated arrears workflows can take pressure off your team and give you better visibility. Book a quick chat today (or simply enter your details below).