Cotality released its Quarterly Rental Review for January-March 2026 and the data confirms that Australia’s rental market is tightening and accelerating again after a brief slowdown in 2025. Persistent supply shortages and worsening affordability are structural forces reshaping rental demand. These factors are shaping how demand is evolving across the market.
The national vacancy rate remains critically low. Cotality reports 1.6% national vacancy rate and SQM data shows even lower at 1.0%. While the absolute figures differ due to methodology, the trend is consistent: rental supply remains severely constrained with no clear signs of easing any time soon. For cities like Brisbane with lower than 1% vacancy rate, the data means that tenant competition intensifies and rental rate increase.
Cotality also reports that the total listings across the country was around 18% below its five-year average. This data reinforces that supply is not catching up. This shortfall is significant because it represents a sustained gap in available housing stock and rapidly growing demand.
On the demand side, affordability has deteriorated significantly. Cotality reports that households are now allocating around 33% of their pre-tax income to rent. This is a record high. Over the five years, national average rents have increased by more than 40%, far outpacing wage growth. This explains the sustained demand for affordable housing. To cope up with this market shift, this group of tenants are sharing accommodation, moving into smaller dwellings, and prioritising affordability over space.
For rooming house investors, this new data highlights both opportunity and responsibility. Persistently low vacancy rates mean strong occupancy, while affordability pressures are increasing demand for shared and lower-cost housing. Rooming houses play a role in providing more accessible accommodation options, particularly for renters priced out of traditional housing. Rooming houses can contribute to maintaining quality living standards, fair pricing, and secured lease for tenants. Aligning investments with affordability-driven demand is key to building resilient, future-ready rental portfolio.
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At the High Yield Property Club, we work with investors who want balance strong occupancy and income potential with high-quality affordable housing. If you’re ready to explore how this strategy can fit into your investment goals, contact us to learn more about available opportunities.
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