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The red-hot rental market has already started to cool and there's further sign of relief over the horizon for struggling tenants.
Renters in many suburbs have endured double-digit growth in rents as demand for housing outstrips supply.
But vacancy rates have already started to ease and the rate of growth has begun to slow, with CoreLogic analysis suggesting the rental boom will keep tempering from here.
Head of research at the property data firm, Eliza Owen, said rental movements and interest rates do tend to move together.
Ms Owen said there were a couple of reasons the two moved in concert.
One was that rents are included in the consumer price index, the key measure of inflation. When rents rise, so does inflation, prompting higher interest rates.
Another is that interest rates can directly impact rents, including by making investment properties less attractive. This reduced rental supply, pushing rents up.
She said higher borrowing costs "may have" prompted investors to pass on costs to renters, but it was not a clear-cut relationship.
The availability of rentals generally determines how much rents can rise, as tenants can choose to leave if there are cheaper options on the market.
Investors of all types, including those with no loan or a small one, have likely taken advantage of the tight rental market to increase their returns, she said.
In fact, the rental market started going up in mid-2020, well before interest rates started rising last year, due to a range of other factors.
Investors who have lifted rents in response to higher interest rates are unlikely covering the full extent of more expensive mortgages, Ms Owen added.
"To put recent rate hikes in perspective, CoreLogic monthly median rent values are estimated to have increased $225 per month over the year to June," Ms Owen said.
"However, mortgage costs of a new investment loan are estimated to have increased by $948 per month on the median Australian dwelling value."
The property researcher offered a couple of other reasons for renters to be more optimistic about 2024, including the reforming of share houses in response to poor affordability.
She also said the backlog of home building work was starting to clear, freeing up rentals occupied by those waiting for their homes to be built.
Lending data has also pointed to investors returning to the market, which is likely to continue if interest rates fall next year and the property market keeps recovering.
New government initiatives around social and community housing may also contribute to a pick-up in housing supply, Ms Owen said.
Prime Minister Anthony Albanese said the government had a range of policies in the works to boost housing supply, including a $2 billion social housing accelerator to deliver thousands of new social homes.
The government is also trying to push its $10 billion housing future fund through parliament, but it has faced opposition from the coalition and the Greens.
The May budget included a new incentive for private sector build-to-rent, which Mr Albanese said could result in as many as 250,000 new dwellings being built.