Vacancy rates remain below 1% in five of the eight capital cities and are 1.5% in Brisbane, according to the monthly report from SQM Research. Above-average vacancies in Sydney and Melbourne mean the national average rate remained at 2% in February.

SQM’s Louis Christopher says vacancies edged higher to 4.5% in Melbourne which remains “weighed down by underwhelming demand for rental accommodation”. Sydney’s vacancy rate rose 0.1 points to 3.3%.

Elsewhere, in Perth, Adelaide, Canberra, Darwin and Hobart, the vacancy rate is below 1.0%. Brisbane’s vacancy rate also remained tight, down to 1.5% in February from 1.7% January. Christopher says it is very much a landlord’s market in regional Australia.

“We are still recording strong interest from tenants in larger properties in outer suburban locations as well as wider regional Australia,” he says.

“Investment property owners in Darwin or Perth have also enjoyed a strong year of rental returns.”