Australia’s rental market remains undersupplied, despite a slight rise in national vacancy rates from 1.2% in May to 1.3% in June.

SQM Research reports that all capital cities remain well below the 3% vacancy rate considered a “balanced” market. Darwin has the tightest conditions at just 0.5%, followed by Hobart (0.6%), Adelaide and Perth (0.8%), and Brisbane (0.9%).

Even Sydney and Melbourne — cities with historically higher turnover — are tight, at 1.6% and 1.8% respectively. Canberra stands at 1.5%. Louis Christopher, Managing Director at SQM, says the minor uptick doesn’t yet signal a market shift. “Many areas are still under extreme rental pressure,” he says. “The small rise in vacancy rates is likely seasonal. Until recent building approvals translate into completed dwellings, conditions won’t ease significantly.”