Australia’s rental market has offered a glimmer of hope for beleaguered tenants, with the number of vacant properties nationally reaching its highest level since February 2022. However, any celebrations may be premature, as the latest data reveals that despite easing conditions, rental prices continue their relentless climb, pushing affordability to breaking point for many.
The latest realestate.com.au Market Insight Report shows the national rental vacancy rate nudged up by 0.19 percentage points over January to 1.48 per cent.
While this marks the highest level in nearly two years, it remains starkly below the pre-Covid figure of 2.3 per cent recorded five years ago – a sobering reminder of the entrenched supply crisis.
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Across the nation, every market saw vacancy rates rise in January, offering a slight reprieve. Capital cities experienced a 0.17 percentage point increase, reaching 1.51 per cent, now sitting marginally above regional areas at 1.40 per cent. This suggests a broader, albeit modest, improvement in rental availability.
The tightest squeeze and where renters find a breath
Despite the national trend, some capital cities remain brutally competitive.
Hobart, often a bellwether for tight conditions, recorded the largest monthly jump in vacancy (up 0.36 percentage points) yet still holds the unenviable title of the nation’s tightest market at a minuscule 0.72 per cent.
The latest PropTrack data has revealed the latest rental vacancy rates across Australia. Picture: Google Gemini
Perth and Brisbane aren’t far behind, with vacant rentals sitting at 1.11 per cent and 1.13 per cent respectively, indicating fierce competition for available properties.
Conversely, Melbourne renters are finding a little more breathing room.
The Victorian capital recorded the highest vacancy rate among all capital cities in January, rising 0.22 percentage points to 1.81 per cent.
Darwin (1.76 per cent) and the ACT (1.59 per cent) also offered comparatively more options, followed by Sydney (1.55 per cent) and Adelaide (1.45 per cent).
Adelaide, however, saw a significant 0.30 percentage point increase in its vacancy rate over the month.
The unyielding march of rental prices
While the increase in vacant properties might sound like good news, it’s done little to curb the relentless upward trajectory of rental prices.
For most capitals, the weekly cost of a house has remained stubbornly unchanged over the past three months.
Yet, some cities are still experiencing eye-watering increases.
According to PropTrack, renters in Adelaide have been hit with a $15 weekly increase between November and February, pushing the average house rent to $625 a week.
The latest PropTrack data has revealed the average weekly rent in each capital. Picture: Google Gemini
Brisbane tenants are facing an even more staggering hike, with an additional $25 a week now required, bringing their average weekly rent to $675.
Sydney continues to lead the pack with a median weekly rent of $800, followed by the ACT at $710. Perth and Darwin both sit at $700 a week, while Hobart demands $598, and Melbourne offers the ‘cheapest’ capital city rent at $580.
Expert warns of further hikes
REA Group Senior Economist Anne Flaherty noted that while conditions for renters have improved over the past three months, they are “largely unchanged from a year ago” and “significantly below the conditions renters faced during the pandemic five years ago when the national vacancy rate was sitting at 2.3 per cent.”
“With the highest vacancy rate of any capital city, renters in Melbourne are facing greater rental availability. On the flip side, renters in Hobart face the most challenging conditions, with just 0.72 per cent of rentals sitting vacant,” she said.
Realestate.com.au senior economist Anne Flaherty
Ms Flaherty also pointed out that regional areas have seen greater relief, with vacancy rates increasing by 0.21 percentage points annually, compared to a mere 0.03 percentage points in combined capital city areas.
Looking ahead, Ms Flaherty delivered a stark warning.
“While the pace of rent growth has slowed across most markets over the past year, continued low vacancy rates are expected to drive rents to new highs in 2026, particularly in markets where supply is constrained, such as Hobart, Perth, and Brisbane,” she said.
The message is clear: while a slight easing in vacancy rates offers a momentary pause, Australia’s rental crisis is far from over, with affordability set to remain a critical challenge for years to come.
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