Australia’s rental vacancy rate rose to 1.4 per cent in September 2026, up from 1.3 per cent in August, according to SQM Research data released on 13 October. It is the clearest sign yet that the rental crunch is starting to loosen in Sydney and Melbourne, with unit rents falling in seven of the eight capital cities over the past month.
The relief is uneven, though. House rents are still rising, annual rent growth remains high, and vacancy rates in Brisbane, Perth, Adelaide, Darwin and Hobart are all still below 1 per cent.
What the September figures show
SQM counted 42,290 residential vacancies nationally in September, up from 41,039 in August and well above the 36,046 recorded a year earlier, when the national vacancy rate was 1.2 per cent. SQM measures vacancies as online rental listings that have been advertised for three weeks or more, compared with the total number of established rental properties.
The increase was concentrated in the two biggest cities:
- Sydney: the vacancy rate rose to 1.8 per cent from 1.7 per cent in August, with 13,331 dwellings available. A year ago it was 1.3 per cent.
- Melbourne: the rate rose to 1.9 per cent from 1.8 per cent, with 10,127 vacancies.
- Canberra: the rate eased to 1.9 per cent from 2.1 per cent, but remains relatively high.
Elsewhere the picture barely moved. Brisbane held at 0.9 per cent, Perth and Adelaide held at 0.6 per cent, Darwin rose to 0.6 per cent from 0.4 per cent, and Hobart eased to 0.5 per cent. As a broad rule of thumb, a vacancy rate below 2 per cent is generally regarded as a landlord’s market, so every capital remains tight by historical standards.
Unit rents are falling, house rents are not
The more interesting signal is in asking rents. Over the 30 days to 12 October, SQM found national combined advertised rents rose 0.3 per cent, but that headline hides a split. House rents rose 1.6 per cent while unit rents fell 1.6 per cent.
The national combined asking rent now sits at about $705 a week, and the capital city average at about $795 a week. The capital city average eased 0.1 per cent over the month.
City by city, according to SQM’s figures for the week ending 12 October:
- Sydney: combined rents rose 0.7 per cent to about $916 a week. House rents rose 2.3 per cent to about $1,159, while unit rents fell 1.0 per cent to about $749.
- Melbourne: combined rents fell 0.7 per cent to about $692 a week, with both house and unit rents down over the month.
- Brisbane: combined rents were flat at about $754 a week, but are 7.2 per cent higher than a year ago.
- Perth: combined rents eased 0.3 per cent to about $796 a week. Annual unit rent growth has slowed to 1.9 per cent, the weakest of any capital.
- Adelaide: combined rents fell 0.7 per cent to about $648 a week.
- Darwin: combined rents rose 0.6 per cent to about $735 a week, and are up 13.9 per cent over the year, the strongest annual growth of any capital.
- Hobart: combined rents fell 0.5 per cent to about $601 a week, though unit rents are still 14.6 per cent higher than a year ago.
SQM managing director Louis Christopher said the divergence in Sydney suggests “rental pressures are beginning to ease, starting with the unit market”. He noted that some of the strength in house rents reflects the usual spring lift, and that the smaller capitals show little sign yet of relief for tenants.
Why rents are taking longer to fall than prices
Annual rent growth is still high. Nationally, combined asking rents are 7.6 per cent higher than a year ago, with house rents up 8.4 per cent and unit rents up 6.3 per cent. Those annual numbers mostly reflect increases that have already happened, so they will lag any turn in the market.
The broader housing backdrop is also shifting. Home values have now fallen for six months in a row, and banks such as NAB have lowered their price forecasts, as we covered in our report on NAB’s cut to its 2026 house price forecast. With the cash rate at 4.60 per cent after the September hike, some would-be buyers are staying in the rental market for longer, which supports rental demand even as more listings appear.
A rising vacancy rate is the first crack in a tight rental market. Falling advertised rents usually follow, and existing leases are the last to feel it.
What it means for tenants
This is general information only, not personal financial or legal advice. If you rent, especially a unit in Sydney or Melbourne, a few points are worth considering:
- Check what comparable properties are listed for. If similar units nearby are advertised for less than your current rent, that is useful context when a rent increase notice arrives.
- Know your state’s rules. Each state and territory sets how often rent can be increased and how much notice is required. Your state’s tenancy authority or fair trading office is the official source.
- Do not assume relief everywhere. In Brisbane, Perth, Adelaide, Darwin and Hobart, vacancy rates below 1 per cent still give landlords most of the bargaining power.
What it means for landlords and investors
For property investors, softer unit rents in the largest cities arrive at the same time as higher borrowing costs. That can squeeze returns, so it is worth rechecking the numbers on any purchase using our guide to how rental yield works. If you are weighing up whether to keep renting, buy or invest while prices fall, it can help to compare the costs of renting and buying in today’s market before committing.
The bottom line
The national rental vacancy rate rose to 1.4 per cent in September 2026, up from 1.2 per cent a year earlier, and unit asking rents fell in seven of eight capitals, according to SQM Research. Sydney and Melbourne tenants are seeing the first signs of easing, but house rents are still rising and the smaller capitals remain very tight. One month of data is not a trend, so watch whether the softening holds through spring. All figures are from SQM Research’s release of 13 October 2026 and may be revised; check the latest data directly with SQM Research.