Australia’s rental market showed a modest seasonal easing at the end of 2025, but vacancy rates remain well below long-term averages, signalling that conditions continue to favour landlords across most capital cities.
According to the latest SQM Research data, the national residential vacancy rate rose to 1.4 per cent in December 2025, up from 1.3 per cent in November.
The total number of vacant rental dwellings increased to 43,850, reflecting a typical year-end rise in listings as leasing activity turns over.
Despite the increase, SQM Research notes that vacancy rates remain low by historical standards, indicating that underlying rental market conditions are still tight.
Capital cities remain constrained
Vacancy rates rose in several major capitals during December, though conditions vary widely by market.
In Sydney, the vacancy rate increased to 1.8 per cent, up from 1.4 per cent in November, with 13,252 dwellings available. SQM attributes the lift to seasonal turnover and an increase in new rental listings toward the end of the year.
Melbourne remained steady at 2.0 per cent, with 10,667 vacant properties, continuing to record the most balanced rental conditions among the major capitals.
In Brisbane, the vacancy rate rose to 1.2 per cent, up from 1.0 per cent, with 4,101 dwellings vacant. While availability has improved slightly, SQM Research notes that conditions remain tighter than pre-pandemic levels.
Several markets remain particularly constrained. Perth’s vacancy rate held at 0.7 per cent, with 1,384 dwellings available, while Adelaide rose marginally to 0.9 per cent. Hobart remained unchanged at 0.4 per cent, with just 124 vacant properties, continuing to rank as the tightest capital city rental market.
In Canberra, the vacancy rate increased to 1.9 per cent, up from 1.5 per cent, reflecting a seasonal rise in listings following the spring leasing period. Darwin remained steady at 1.0 per cent.
Rents regain upward momentum
While vacancy rates lifted modestly, rental pricing data suggests renewed upward momentum entering 2026.
Nationally, advertised rents increased 2.4 per cent over the past 30 days and were 5.8 per cent higher year-on-year, according to SQM Research. The national combined weekly rent now averages $684.62, while the capital city average sits at $766.49 per week.
House rents continue to outpace unit growth. Nationally, house rents rose 3.4 per cent for the month and 7.0 per cent over the year, while unit rents increased 1.0 per cent monthly and 4.1 per cent annually.
Several capitals recorded strong annual growth. Darwin’s combined rents rose 9.0 per cent year-on-year, while Hobart recorded a 10.0 per cent annual increase, reflecting ongoing supply constraints.
Brisbane rents rose 7.1 per cent over the year, supported by sustained population growth and limited new supply.
In contrast, Canberra recorded a 1.0 per cent monthly decline in rents and a 1.6 per cent annual fall, indicating a short-term easing following earlier increases.
Seasonal easing, not structural change
SQM Research said the lift in vacancy rates during December was largely seasonal and does not signal a shift in underlying market fundamentals.
While some easing was observed in cities such as Sydney and Canberra, markets including Perth, Adelaide and Hobart remain exceptionally constrained, with vacancy rates below one per cent limiting meaningful relief for tenants.
The rebound in advertised rents entering January suggests the late-2025 softening in rental growth is likely to be temporary. Without a sustained increase in new rental supply, SQM Research expects affordability pressures to persist into 2026.
Capital city rental vacancy rates – December 2025 (SQM Research)
- Hobart (0.4%)
- Perth (0.7%)
- Adelaide (0.9%)
- Darwin (1.0%)
- Brisbane (1.2%)
- Sydney (1.8%)
- Canberra (1.9%)
- Melbourne (2.0%)
