Australia’s national residential vacancy rate fell to 1.0 per cent in March 2026, according to data released by SQM Research. This figure represents a decrease from the 1.1 per cent vacancy rate recorded in February 2026, signaling a deepening rental crisis with supply levels reaching critically low
levels in several areas.
The shortage of available properties is coinciding with projections of significant price increases in the apartment sector. Global real estate firm CBRE forecasts that median apartment rents in Australian capital cities will rise by 27 per cent between 2025 and 2030, while apartment prices are expected to increase by 28 per cent over the same period.
Apartment Rent and Price Projections
The CBRE Apartment vacancy, rent and price outlook report indicates a severe supply shortage that will likely maintain upward pressure on costs. The firm predicts that by 2030, 83 per cent of two-bedroom apartments will have weekly rents exceeding $700, with 36 per cent of such properties exceeding $1,000 per week.
This surge is attributed to a chronic housing shortage and a lack of new construction, which has left the market unable to keep pace with demand across 53 key capital-city precincts.
Vacancy Rate Trends
CBRE expects capital-city vacancy rates to tighten further, predicting a drop to 1.1 per cent by 2030. This represents a decline from the 1.8 per cent vacancy rate seen in 2025 and is approximately half of the 2.5 per cent average recorded over the previous decade.
A balanced market for apartment rentals would typically see vacancy around 4% to 5%
CBRE
The current and projected vacancy rates underscore a highly constrained market, as the gap between the current reality and a balanced market continues to widen.
Economic Drivers of Housing Demand
According to CBRE, demand for housing is being propelled by a triple boost
consisting of rising incomes, job creation, and population growth. These factors are expected to add approximately $1 trillion to the economy, the majority of which is projected to flow into living costs and housing.
The broader rental crisis has been driven by a combination of decreased rental supply, record-low vacancy rates, and rising rent prices. These conditions have impacted tenants, landlords, and real estate agents, leading to rental affordability reaching a record low across Australia.
Addressing the current market imbalance will require long-term solutions to create a more balanced rental market, alongside strategic planning and government intervention.