Queensland’s rental market remains at a virtual standstill, with the statewide vacancy rate stuck at 1.0% for the September 2025 quarter, according to the Real Estate Institute of Queensland (REIQ).
The September Quarter Residential Vacancy Rate Report shows tight conditions persist across the state, with 38 of 50 regions recording vacancy rates of 1% or less — well below REIQ’s healthy range of 2.6% to 3.5%, which supports housing mobility and population growth.
Of the 50 local government areas and sub-regions assessed, 23 tightened, 15 remained unchanged, and 12 relaxed compared to the June quarter.
Nationally, the rental market remains just as constrained, with SQM Research reporting a 1.2% vacancy rate in October — unchanged from September.
REIQ CEO Antonia Mercorella (pictured) said that while vacancy rate movements differ across Queensland, the overall picture is one of gridlock.
“Queensland’s rental market is like a traffic jam – many people are staying put because finding somewhere to move can be really difficult,” Mercorella said.
“Even though the statewide vacancy rate hasn’t worsened, this entrenched tightness has created a kind of rental gridlock, where people are renewing, not necessarily because they want to, but because they don’t want to risk competing for somewhere new.
“Longer tenancies, while sometimes seen as a positive indicator of a healthy market, can also reflect a lack of choice rather than stability.
“When tenants sign a lease or renew out of necessity instead of preference, it’s a sign that scarcity is seizing up the market and contributing to inefficiencies.”
She said property managers continue to receive high volumes of rental applications, with many tenants applying for multiple homes as “backup” options.
Data from the Residential Tenancies Authority (RTA) shows the median tenancy length for houses increased to 21.1 months in FY24/25 (up from 20.8 months), while unit tenancies held steady at 18.2 months.
Mercorella said tight market conditions, rising costs, and recent legislative changes are putting additional strain on lessors.
“In a tight market, we’re seeing higher instances of tenants who are accepting lease terms that they don’t intend to see through – continuing to look for a preferred property to rent or to buy,” she said.
“Many owners are showing greater frustration over successive early break leases and have a reduced tolerance and financial capacity to absorb vacancy periods and foot the bill for new advertising and letting costs, with limited rent compensation.”
Most of Queensland’s major centres remain well within tight territory.
Regional markets remain equally constrained:
At the extreme end, Cook (0%), Charters Towers (0.1%), and Goondiwindi (0.1%) reported the tightest conditions, while Isaac (5.5%) and Bay Islands (4.0%) were the only “weak” markets.
Mercorella said there’s little evidence of the usual end-of-year easing in sight.
“We’re seeing fairly constant rental activity spread evenly throughout the year – the traditional seasonal peaks and troughs have flattened out,” she said.
The REIQ chief noted that Queensland’s housing mix remains unable to deliver the volume or diversity of dwellings needed to restore balance.
“We need to be accelerating new builds, encouraging investment in the private rental sector, and supporting diverse housing models such as build-to-rent and smaller dwelling formats,” Mercorella said.
“Without policy and planning settings that actively unlock supply, and without fair and balanced rental legislation that encourages investors, this gridlock will persist.”
For brokers, the data underscores intensifying rental constraints that may sustain investor demand and refinancing opportunities into 2026.
With Queensland’s vacancy rate gridlocked and construction lagging, lending strategies around build-to-rent, dual-income properties, and new developments will remain crucial to supporting both investor and housing-supply clients.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
