The rental crisis isn’t over yet—far from it. Despite a slight easing in Australia’s rental markets at the end of 2025, vacancy rates remain stubbornly low, leaving tenants struggling to find affordable housing. But here’s where it gets controversial: while some cities saw a modest uptick in available properties, the overall picture suggests landlords still hold the upper hand. And this is the part most people miss: even with seasonal fluctuations, the underlying market conditions are far from balanced.
According to SQM Research, the national vacancy rate inched up to 1.4% in December 2025, compared to 1.3% in November. This increase brought the total number of vacant rentals to 43,850, a typical year-end rise as leases turn over. However, these numbers are still well below historical averages, indicating a persistently tight market. For context, a healthy rental market usually sees vacancy rates closer to 3%, a figure we haven’t seen in years.
Let’s break it down by city. Sydney saw its vacancy rate rise to 1.8%, up from 1.4% in November, with 13,252 properties available. SQM Research attributes this to seasonal turnover and a late-year surge in new listings. Melbourne, meanwhile, held steady at 2.0%, boasting the most balanced conditions among major capitals with 10,667 vacant properties. But balance is relative—even Melbourne’s numbers are lower than ideal.
Brisbane’s vacancy rate climbed to 1.2%, up from 1.0%, yet conditions remain tighter than pre-pandemic levels. Perth and Adelaide stayed under 1%, with Perth at 0.7% and Adelaide at 0.9%. Hobart, with just 124 vacant properties and a 0.4% vacancy rate, remains the most constrained market in the country. Even Canberra, which saw its vacancy rate rise to 1.9%, is still far from offering tenants meaningful relief.
Now, let’s talk rents. While vacancy rates ticked up slightly, rental prices are surging again. Nationally, advertised rents jumped 2.4% in the past 30 days and 5.8% year-on-year. The average weekly rent across Australia now stands at $684.62, with capital cities averaging $766.49. House rents are outpacing units, rising 3.4% monthly and 7.0% annually, compared to 1.0% and 4.1% for units, respectively.
Some cities are feeling the heat more than others. Darwin and Hobart saw annual rent increases of 9.0% and 10.0%, respectively, driven by chronic supply shortages. Brisbane’s rents rose 7.1% year-on-year, fueled by population growth and limited new housing. In contrast, Canberra experienced a 1.0% monthly decline and a 1.6% annual drop, a rare bright spot for tenants—though it’s likely temporary.
SQM Research emphasizes that this seasonal easing isn’t a structural shift. Markets like Perth, Adelaide, and Hobart remain critically tight, offering little relief for renters. The rebound in advertised rents entering 2026 suggests that the late-2025 slowdown was just a blip. Without a significant increase in new rental supply, affordability pressures are here to stay.
So, here’s the big question: Is the rental crisis a temporary hiccup or a long-term trend? Some argue that government intervention is needed to boost supply, while others believe market forces will eventually correct the imbalance. What do you think? Are we doing enough to address the housing shortage, or is this just the new normal? Let’s hear your thoughts in the comments.
