Australia’s rental crisis deteriorated further in July, with the national vacancy rate close to half pre-covid levels.

New PropTrack research shows that rental vacancy rates decreased slightly in July, down 0.04 percentage points (ppt) to 1.43%.

Lower rental vacancy rates spell news for renters, reflecting fewer rental properties coming to market.

Sydney saw rental conditions worsen in July, with vacancy rates falling 0.09 ppt to 1.65%.

Melbourne’s rental vacancy rate held steady at 1.41% in July, however, is sitting 0.82 ppt lower than 12 months ago – the largest annual drop of any capital city.

Melbourne has seen the sharpest decline in rental vacancies of any market over the past 12 months. As Australia’s fastest-growing capital city, vacancy is likely to fall further in Melbourne and lead to higher rents

PropTrack Economist Anne Flaherty (in photo above) expects the cost of renting to likely increase further for Australia’s tenants in the months ahead, with the national vacancy rate falling in July.

“Both capital cities and regional areas saw the supply of rental properties decrease over July,” she said.

“Melbourne has seen the sharpest decline in rental vacancies of any market over the past 12 months. As Australia’s fastest-growing capital city, vacancy is likely to fall further in Melbourne and lead to higher rents.”

Other capital cities experienced the following results:

  • Brisbane’s rental vacancy rate was largely unchanged over the month, rising just 0.01 ppt to 1.15% in July.
  • Adelaide and Perth continue to see the tightest rental market conditions, with vacancy still sitting below 1% in these cities.
  • Regional areas also saw the supply of rental properties fall over July, with the vacancy rate dropping 0.04 ppt to 1.51%.

“While vacancy rates in regional areas fell over July, they remain above the levels seen 12 months ago in every state, with regional NT and Tasmania seeing the biggest jump in availabilities,” Flaherty said.

“This suggests a slowdown in the trend towards regional living that accelerated during the pandemic.

“Although, pressure is unlikely to ease any time soon for tenants, with the number of vacant properties predicted to remain at extremely low levels over at least the next 12 months.”