Key takeaways
Rents have softened slightly in some cities.
Sydney house rents fell around 2.4% and Brisbane nearly 2%, suggesting rental growth is easing after the sharp rises of recent years.
Rental markets are still extremely tight.
Vacancy rates remain around or below 1.5%, meaning demand from tenants still far exceeds the number of available rental properties.
The Gold Coast now has the highest house rents at about $950 per week, above Sydney at $800 and well ahead of Melbourne at $580.
Building approvals dropped 13.8% in January, with apartment approvals plunging almost 30%, reducing the future pipeline of new homes.
With strong demand, low vacancies, and falling construction approvals, upward pressure on rents and housing shortages are likely to continue through 2026.
Something strange is happening in Australia’s housing market right now.
In some of our major cities rents have actually fallen slightly over the past month.
Sydney house rents, for example, dropped by about 2.4%, while Brisbane rents slipped nearly 2%. But before renters start celebrating, there’s a much bigger story unfolding beneath the surface.
Vacancy rates across the capital cities remain extremely tight - generally around or below 1.5%. That means there are still far more tenants looking for homes than properties available.
And at the same time, the pipeline of new housing is shrinking again.
New building approvals have fallen sharply, particularly for apartments, which are the type of housing that normally adds the most supply to our cities.
So while rents might be wobbling a little in the short term, the bigger question is this…
Are we actually setting ourselves up for an even worse housing shortage in the years ahead?
In this week's Property Insider Chat, Dr Andrew Wilson and I dig into what has actually been happening in our housing markets and as always, we’ll go beyond the headlines and explain what this means for you as a property investor or homebuyer in today’s market.
Rental markets tighten over February
Watch this week's Property Insider video as Dr Andrew Wilson explains that Australia’s rental markets are no longer accelerating at the pace seen over the last couple of years, but even though rental growth has slowed a little, vacancy rates continue to tighten in most cases.
As you can see from the charts below, the relative cost of renting now varies sharply between cities.
The Gold Coast is the most expensive market for houses, with median weekly rents at $950 - higher than Sydney ($800) and well above Melbourne at $580.
- Also read:Latest Property Price Forecasts Revealed. Australian Property Market Outlook 2026: Where To Now After The Rate Rise.
- Also read:National Weekly Auction Report – March 7th 2026 | Auction Clearance Rates Ease as Listings Fall Over Holiday Weekend
- Also read:Latest Property Asking Prices State by State | National Listings Rebound Strongly in February as New Supply Surges
- Also read:Booming Housing Markets Rise Over February | Latest stats from Dr. Andrew Wilson
- Also read:This week’s Australian Property Market Update – Latest Data, State by State February 24th 2026
Although migration growth has continued to decline and first home buyer numbers have surged, this has been offset by lower new supply, which has contributed to maintaining low vacancy rates into 2026.
Capital city rental markets have generally continued to report tightening conditions into February 2026, with falling vacancy rates that remain low for both houses and units – outcomes set to continue through 2026 and set to place upward pressure on rents.
Home building approvals still falling
Watch this week's Property Insider video as Dr. Andrew Wilson explains that home building approvals fell 13.8% over January, following a similar fall in December.
In particular, the more volatile measure of unit approvals fell 29.8%.
Of course, we know that not all projects that get building approvals actually get out of the ground, particularly apartments, which are too expensive to build in many locations.
The following charts show how building approvals have fallen significantly since their peaks in 2016.
Auction clearance rates ease as listings fall over holiday weekend
Watch this week’s Property Insider video as Dr Wilson explains how capital city auction clearance rates were lower over the past week, with buyers and sellers distracted by long weekend holidays in most capitals.
Lower auction listings over the past week have combined with holiday-distracted buyers, particularly in Melbourne.
However, auction numbers will rise over the coming weeks and should reveal a clearer insight into auction market activity and buyer and seller sentiment.
