SQM Research April 2026: National Rental Vacancy at 1.0% — City-by-City Data Analysis

SQM Research released its monthly national rental vacancy rate data on 15 April 2026. Three figures define the release:

• National vacancy rate: 1.0% (tightest reading in approximately 12 months)
• Dwellings advertised for rent nationally: 31,732
• National rent growth: +6.6% year-on-year, running at a 5.9% annualised rate on more recent readings

Against the pre-COVID decade average of approximately 2.5% vacancy, the April 2026 reading sits more than one full percentage point below balanced levels — a signal of continued structural undersupply, not a temporary fluctuation.

Methodology Note: How SQM Measures Vacancy

SQM Research's vacancy series tracks the number of residential properties advertised for rent on major portals — primarily REA Group and Domain — that have been listed for three weeks or more. This figure is divided by an estimated total rental stock for each geographic area to produce the vacancy rate. The three-week threshold is designed to filter out properties in routine turnover between tenants.

Two caveats are worth noting when interpreting the data:

• Advertised stock only: Off-market rentals, informal sub-leases, and short-term accommodation (e.g. Airbnb) are not included in the vacancy count.
• Differs from ABS occupancy data: SQM measures a flow (listings), whereas ABS Census data measures a stock (dwelling occupancy at a point in time). The two series answer related but distinct questions.

The strength of the SQM series is its monthly cadence, long history (data available from 2005), and consistent methodology, which make it suitable for trend analysis and cross-market comparison.

City-by-City Vacancy — April 2026

The national 1.0% figure averages considerable variation across capital city markets. Five of the eight capitals sit at or below 1.0%; three (Melbourne, Canberra, and ACT-adjacent regions) sit above. Even the "looser" end of this distribution would have been classified as tight by pre-2020 benchmarks.

Historical Context: 1.0% in a 20-Year Frame

Between 2013 and 2019, the national vacancy rate ranged between 2.2% and 3.2%, typically sitting near the middle of the balanced band. National vacancy compressed sharply from early 2022 as international migration resumed and new supply failed to keep pace with demand. The series briefly eased back toward 1.2–1.3% through mid-2023 and 2024 before tightening again through late 2025 and into 2026.

The April 2026 figure of 1.0% is consistent with three structural forces operating simultaneously:

1. New supply running below household formation: The National Housing Accord target of 1.2 million new homes by 2029 is materially behind its cumulative trajectory.
2. Population growth via migration: Net overseas migration has remained elevated relative to the 2010s baseline, adding demand faster than dwellings can be delivered.
3. Investor market constraints: Higher lending rates (RBA cash rate at 4.10% following hikes in early 2026) and state-level tax changes have reduced the marginal investor appetite to fund new rental supply.

Rent Growth: 6.6% YoY Against 3.4% Wage Growth

SQM's April 2026 data places the combined capital city median rent at $782.57 per week and the national combined median (houses and units, capital and regional) at $688 per week. National rent growth is running at +6.6% year-on-year, with the more recent annualised reading at 5.9%.

The relevant comparator for affordability is wage growth. The ABS Wage Price Index through Q4 2025 recorded annual growth of approximately 3.4%. Rent is therefore rising at close to twice the rate of wages. In aggregate, this means the share of gross household income allocated to rent is increasing year-on-year — the conventional definition of deteriorating rental affordability.

The rate of rent growth varies materially by market. Perth and Darwin — the two tightest capital city vacancy rates outside Adelaide — are also recording the highest rent growth, consistent with the supply/demand mechanism that links vacancy to price. Sydney and Melbourne, which carry higher absolute rent levels, are growing more slowly in percentage terms but from a higher base.

Yield Compression Analysis

Gross rental yield is a simple function of annualised rent divided by property value. Where capital values rise faster than rents, yields compress — a dynamic currently visible in the larger capitals.

For illustration: Sydney's median house value per Cotality April 2026 data sits near $1.4 million. The corresponding median house rent in Sydney sits near $900 per week (houses only, separate from the combined house-and-unit figure of ~$860/week referenced in the table above). That produces a gross yield of approximately 3.3% on Sydney houses. Against prevailing investor lending rates of approximately 6.2–6.8% (following two RBA hikes to 4.10% in early 2026), a 3.3% gross yield implies significant negative gearing in the early holding years.

By contrast, Perth — where rent growth is running at a higher pace than capital growth forecasts — currently offers combined gross yields in the 4.0–4.5% range on houses, and Darwin's yield range of 6.0–7.5% on houses is the highest of any capital city. Brisbane units sit in a similar range to Perth, typically 4.8–5.8% gross, with sub-1.0% vacancy in inner and middle ring areas.

Yield and Vacancy Matrix

Combining SQM vacancy data with widely reported gross yield ranges produces the following cross-sectional picture of capital city markets as at April 2026. Yield ranges are illustrative and drawn from publicly reported sources; investors should verify specific figures against current listings before acting on them.

Three observations follow from the matrix:

1. Darwin is the vacancy-yield outlier. The tightest vacancy in the country is paired with the highest gross yields. Darwin's market depth and liquidity are lower than the eastern capitals, which is a separate consideration for portfolio construction.
2. Perth and Adelaide combine sub-1.0% vacancy with mid-range yields. Both markets sit in the supply-shortage band while offering gross yields materially above Sydney and Melbourne.
3. Brisbane units carry the strongest yield/growth cross-over. Unit yields of 4.8–5.8% sit alongside 1.0% city-wide vacancy and the 2032 Olympics infrastructure pipeline — a combination not present in other eastern capitals.

SQM 2026 Outlook: The Boom & Bust Report Context

SQM Research's annual Boom & Bust report, authored by Louis Christopher, sets out forward scenarios for each capital city across price and rent dimensions. Its base case for 2026 anticipates continued upward pressure on rents in the absence of a material supply response, with the most acute pressure in Perth, Darwin, and Adelaide.

The April 2026 vacancy data is consistent with that base case. The forward completion pipeline — particularly in the unit sector, which disproportionately affects rental supply — remains constrained by construction costs, financing conditions, and planning delays. The NAB Residential Property Survey for Q1 2026 records property professionals expecting a further 4–6% rent increase nationally through 2026.

What to Watch Next

The following releases will help confirm or refute the trajectory implied by the April 2026 data:

• SQM Research May 2026 vacancy release (mid-May) — whether national vacancy holds at 1.0% or tightens further into winter.
• ABS Residential Property Price Indexes Q1 2026 (late April/early May) — cross-reference with Cotality and PropTrack for triangulated value growth.
• ABS Wage Price Index Q1 2026 (mid-May) — updated wage growth comparator for the rent affordability gap.
• ABS Building Approvals monthly — leading indicator for new supply pipeline 18–36 months out.
• RBA May 2026 meeting — whether the 4.10% cash rate changes direction, which affects investor appetite to fund new rental supply.
• Cotality Housing Chart Pack May 2026 — confirmation of value growth trends against the SQM rent and vacancy data.

Summary

SQM Research's April 2026 release documents a national rental vacancy rate of 1.0%, with 31,732 dwellings advertised for rent. The reading is the tightest in approximately 12 months, sits materially below the pre-COVID decade average of 2.5%, and is consistent with a structural undersupply in which new dwelling completions have run persistently below household formation.

Rent growth of 6.6% year-on-year runs at approximately twice the pace of wage growth (3.4% per ABS WPI), which is the conventional definition of deteriorating rental affordability in aggregate. The city-level distribution shows Darwin (0.4%), Adelaide (0.6%), and Perth (0.8%) in the acute shortage band; Melbourne (1.4%) and Canberra (1.6%) remain below balanced levels despite higher relative vacancy.

Whether the April reading represents a new floor or a waypoint in a further tightening cycle will be tested by the May 2026 releases and by the RBA's rate trajectory through the second half of the year.