Finding an available rental home remains difficult across much of the country, with the latest SQM Research figures showing that vacancy rates continue to sit at exceptionally low levels. Although rental availability has displayed some signs of stabilisation, the national vacancy rate did not improve during July 2026. The continuing shortage of vacant properties reinforces the pressure confronting tenants and helps explain why rental affordability remains a significant issue in many capital cities.
The national residential vacancy rate remained at 1.3% in July 2026, unchanged from June. At that level, SQM Research calculated that there were 40,771 vacant dwellings nationally. A stable monthly figure may indicate that conditions are no longer deteriorating at the same pace, but a vacancy rate of only 1.3% still represents a highly constrained rental environment.
Conditions are even tighter in several individual capital cities. Brisbane, Perth, Adelaide, Darwin and Hobart all recorded vacancy rates below 1%. When vacancy levels fall beneath this threshold, tenants can face intense competition for available properties, particularly in popular suburbs and price ranges. Low availability can also limit the ability of renters to move when their existing rent becomes unaffordable.
Darwin recorded the lowest vacancy rate among the capitals at just 0.3%. Such a small proportion of available rental properties indicates an extremely tight market and leaves prospective tenants with limited choice. It can also contribute to greater competition when suitable properties are advertised, particularly when household formation and employment-related migration create additional demand.
Sydney and Melbourne each recorded vacancy rates of 1.7%. While those figures are higher than the rates in Brisbane, Perth, Adelaide, Darwin and Hobart, they still indicate limited rental availability relative to what would generally be considered a more balanced market. The large populations of Sydney and Melbourne also mean that even relatively small changes in vacancy conditions can affect substantial numbers of households.
Canberra had the highest vacancy rate among the capital cities at 1.8%. Despite leading the capitals on this measure, Canberra’s rate remains low enough to indicate that rental availability is constrained. The difference between Canberra at 1.8% and Darwin at 0.3% also demonstrates the varying degree of pressure being experienced across individual markets.
SQM Research managing director Louis Christopher says the latest figures point to some stabilisation in the availability of rental properties, but he emphasises that underlying conditions remain tight. Total vacancies have increased compared with the same period last year, particularly in Sydney and Canberra. That annual improvement is encouraging, although it has not been large enough to restore broadly comfortable conditions for tenants.
Christopher notes that five capital cities are still recording vacancy rates below 1%. This is an important indicator because it demonstrates that modest improvements in the national number of vacant properties do not necessarily mean individual markets have moved into balance. In many cities, available rental stock remains insufficient relative to the number of households looking for accommodation.
The consequences are particularly significant for tenants. When vacancy rates remain extremely low, renters may need to submit applications for multiple properties, compromise on preferred locations or accept homes that do not fully meet their requirements. Households may also have less capacity to negotiate rent because landlords can have several prospective tenants competing for the same dwelling.
Low vacancy rates and rising rents are closely connected. A shortage of available homes strengthens competition and can support higher asking rents, particularly where population growth is strong. Increasing the number of vacant properties does not automatically make housing affordable, but greater supply can improve tenant choice and reduce some of the competitive pressure affecting the market.
Christopher says significant pressure on tenants remains and describes the rental sector as undersupplied. The central issue is whether the increase in available stock can become sustained rather than appearing only as a modest short-term improvement. Until substantially more rental properties become available, affordability pressures are expected to remain elevated.
The July figures illustrate the size of that challenge. National vacancies remained unchanged at 1.3%, representing 40,771 dwellings, while five capitals continued to sit below the 1% mark. Darwin’s 0.3% vacancy rate is particularly restrictive, while Brisbane, Perth, Adelaide and Hobart also remain exceptionally tight.
Sydney and Melbourne, at 1.7%, and Canberra, at 1.8%, provide somewhat more availability, but none of these figures indicates a rental market with abundant choice. Even where vacancies have increased compared with last year, tenants continue to face a constrained environment.
A sustained increase in rental housing supply will therefore be critical to improving conditions. Until vacancy rates rise more substantially and remain higher for an extended period, renters are likely to continue facing strong competition, restricted choice and elevated affordability pressures throughout the housing market.
