Australia’s rental market is showing early signs of improvement, with the number of available rental properties increasing over the past year. However, despite this modest uplift, rental conditions remain difficult, particularly when compared with the pre-pandemic period.

According to new data from PropTrack, total rental listings in June 2026 were 2.2% higher than in June 2025 nationally. Listings also sat 2.6% above the five-year monthly average, suggesting a slight improvement in rental availability.

Despite this progress, longer-term trends reveal that the number of available rental properties remains well below pre-pandemic levels. Furthermore, rental listing volumes have largely plateaued over the past two years, meaning the recent increase is unlikely to provide significant relief for renters.

Why Rental Availability Remains Tight

Several factors continue to constrain rental availability across Australia.

A key driver has been exceptionally strong population growth. Between mid-2023 and mid-2025, net overseas migration averaged around 425,000 people each year. As a large share of new arrivals initially enter the rental market, competition for available homes has intensified.

Household composition has also played a role. Although the average household size has declined only marginally over the past decade—from 2.6 to 2.5 people per household—this seemingly small shift has generated demand for an estimated 144,000 additional rental homes, based on renter households accounting for around one-third of all households.

At the same time, new housing supply has struggled to keep pace with growing demand. While building approvals have trended upward, housing completions have failed to match population growth in every state except South Australia, the Australian Capital Territory and Tasmania over the 12 months to September 2025.

Construction capacity remains a significant constraint, with the industry continuing to experience the largest workforce shortages of any sector. These labour shortages, combined with elevated construction costs, continue to limit the pace at which new housing can be delivered.

Some Regions Are Seeing Greater Rental Choice

Although rental conditions remain tight nationally, some regions have experienced substantial improvements in rental availability over the past 12 months.

In regional Australia, Far West and Orana and New England and North West in New South Wales, along with Wide Bay in Queensland, recorded the strongest growth in rental listings. Renters in these regions had close to 40% more properties available than they did a year earlier.

Other regional areas also saw notable gains. Rental listings increased by 33% in Hume, Victoria, and by 24% in Launceston and North East, Tasmania, giving renters in these markets considerably more choice.

Within the capital cities, Sydney’s Outer South West, Northern Beaches, and Baulkham Hills and Hawkesbury regions experienced the largest increases in rental listings, with available properties rising by 12–13% over the year.

The Australian Capital Territory and Sydney’s Ryde region also recorded some of the strongest improvements, with rental listings approximately 12–13% higher than in June 2025.

Outlook: Demand to Remain Strong

Looking ahead, annual population growth is projected to average around 235,000 people over the next decade, suggesting demand for rental housing will remain elevated.

On the supply side, the 2026–27 Federal Budget introduced a new $2 billion Local Infrastructure Fund aimed at supporting additional housing development. While this initiative is expected to boost housing supply over time, its impact will not be immediate.

Although rising building approvals are an encouraging sign, supply constraints are likely to persist in the near term due to ongoing labour shortages and relatively high construction costs.

What This Means for Renters

The interaction between sustained demand and constrained housing supply is expected to keep rental availability tight and continue placing upward pressure on rents. Conditions could gradually improve if labour shortages ease and residential construction accelerates, but meaningful relief is likely to take time.

Recent changes to property taxation announced in the Federal Budget may also influence the market. The reforms could discourage some investors from entering the housing market, potentially reducing rental supply. However, this effect may be partly offset if the policy changes increase home ownership by reducing competition for established homes.

With many of these policy changes yet to fully take effect, the direction of Australia’s rental market will become clearer over the coming months. While renters in some regions are already benefiting from greater choice, nationwide conditions remain challenging and are expected to stay constrained for the foreseeable future.