Queensland rental crisis worsens as vacancy rates drop to 0.9% statewide

Queensland’s rental crisis has deepened with vacancy rates falling to 0.9% statewide in the March 2025 quarter, according to the latest Residential Vacancy Rate Report from the Real Estate Institute of Queensland (REIQ).

The drop from 1.0% in the previous quarter ended a three-quarter period of steady conditions, revealing an entrenched strain on rental supply across most regions.

Nearly half of the regions surveyed experienced tightening vacancy rates, with 24 of the 50 regions showing decreased availability, while 12 held steady and only 14 regions saw any improvement.

REIQ CEO Antonia Mercorella said Queensland’s rental market has started 2025 with even fewer rental options, with vacancy rates tightening in nearly half of the report’s regions.

“The pressure continues to mount in our inner and outer suburban areas — particularly in Brisbane and surrounds, which recorded one of the most notable tightening movements this quarter,” Ms Mercorella said.

“However, despite these results, property managers are reporting more subdued letting activity, increased days on market, and lessors being more careful with tenant selection.

“This paradox of lower activity despite a tight market reflects some fatigue on both sides: many renters are being priced out, stretching too far, or grouping up to rent, while lessors are holding firm on terms and expectations due to rising costs and more onerous legislative requirements.”

Brisbane LGA’s vacancy rate fell to 1.0%, with surrounding regions experiencing even tighter conditions.

Pine Rivers, Redcliffe, and Moreton Bay now have vacancy rates between 0.6% and 0.7%, highlighting the severe shortage of rental options in these areas.

The situation is most dire in Cook and Goondiwindi, which both recorded 0.0% vacancy rates, meaning virtually no rental properties are available.

A further 16 regions reported extremely low rates of 0.5% or below, including Maryborough, Toowoomba, Caloundra Coast, and Southern Downs.

Only two regions fell within the REIQ’s “healthy” vacancy rate range of 2.6-3.5% – the Bay Islands (2.5%) and Isaac (3.2%).

Noosa saw the most significant easing, with its vacancy rate rising to 2.0%, though the REIQ noted this is unlikely to help average renters due to the area’s high price points.

The housing shortage appears to be a structural issue, with recent Australian Bureau of Statistics data showing that building approvals are falling well short of targets.

For Queensland to meet its share of the National Housing Accord target, approximately 4,100 new dwellings would need to be approved each month.

However, March 2025 figures show only 3,116 approvals, with the trend estimate falling from 3,120 in July 2024 to 2,957 in March 2025.

Ms Mercorella said there’s little doubt that structural undersupply remains the key driver of the crisis, and that policy settings must do more to incentivise private investment and fast-track new housing supply.

“Queensland’s stubbornly tight rental conditions are symptomatic of years of underinvestment in housing supply, compounded by rapid population growth,” she said.

“There’s no silver bullet, but the solution lies in one thing: more housing.

“We continue to see a severe imbalance between supply and demand in Queensland’s rental market, and it is crucial that we focus on addressing the roadblocks that are preventing new housing from coming online.

“Whether it’s investing in enabling infrastructure, land release, or planning reforms, all levels of government must work together to ensure that there are enough properties available to meet demand.

“Until all levels of government focus on cutting red tape, fast-tracking approvals, and removing barriers to private investment, these numbers will not meaningfully improve.”

The latest phase of Queensland’s rental reforms took effect from 1 May 2025.

With these changes now implemented and the recent federal election concluded, the REIQ expects greater market certainty, which may encourage more long-term decision making from property market participants.