Residential vacancy rates rose to 1.4% in November, the highest level in three years, according to SQM Research. It says the total number of vacant rental properties is now 41,894, up from 36,486 in October, due mainly to seasonal factors.

According to SQM Research, vacancies rose to 2% in Melbourne, 1.8% in Sydney and 1.1% in Brisbane – all still below the 3% considered to represent a balanced rental market. Inner city markets have much higher vacancy rates including, Sydney CBD (6.4%), Melbourne CBD (5.9%) and Brisbane CBD (2.4%).

SQM Research, Managing Director Louis Christopher says the rise is a result of seasonal factors and broader economic pressures. “At this time of year, we normally record a seasonal increase in vacancies driven in part by university graduates completing their courses and returning home,” he says.

Christopher says high living costs mean more people are pooling resources and moving into shared housing instead of renting a property on their own, which has also freed up some of the rental market.