Healthy vacancy rates kept at bay, says REIQ

The Bay Islands is the only rental market in Queensland considered ‘healthy’, as slight easing in vacancy rates seen last quarter largely evaporated in the September quarter.

According to the Real Estate Institute of Queensland’s (REIQ) latest Residential Vacancy Rate Report for the September 2026 Quarter, 48 of the 50 regions tracked across the state were in the tight range of 0-2.5%.

The Bay Islands (which include North Stradbroke, Russell, Macleay, Karragarra, Lamb, and Coochiemudlo Islands) at 3.5% was the sole market within the REIQ’s healthy range of 2.6-3.5%, and Isaac was the one outlier classified as weak (3.6%-plus) at 6.5%.

Showing just how difficult it can be to find a rental if you don’t act quickly, 34 of the regions recorded a vacancy rate of a mere 1.0% or less.

Cook recorded effectively no rental vacancies at 0.0%, while Charters Towers and Goondiwindi remained exceptionally tight at just 0.1%.

Any signs of broader relief were also short-lived. Compared to the June quarter, 21 markets tightened (or rebounded back, eroding previous gains), 15 were stable or unchanged, and 14 eased only slightly over the September quarter.

REIQ CEO Antonia Mercorella said these figures translate to very few vacancies on the ground.

“A healthy vacancy rate is the ideal middle ground for all parties where there’s enough choice for tenants without excessive vacancy for property owners,” Ms Mercorella said.

“To have just one healthy rental market in the state, and for that market to be a group of islands, speaks volumes about the shortage of rentals in Queensland.

“The Bay Islands are beautiful but clearly come with some logistical considerations if you’re commuting to and from Redlands.

“Meanwhile, Isaac is a mining region and therefore has a transient workforce which may contribute to its ‘weak’ rating.

“With every other region in the state considered ‘tight’, there is likely to be a vast mismatch between the number of renters seeking a property versus the number of lasting lease listings.

“As a result, there’s more multigenerational family households forming and friends doubling up under the one roof to strengthen their options and share the costs.

“The median tenure for rental properties also grew slightly over the financial year – 21.2 months for houses (up from 21.1 last year), and 18.4 months for units (up from 18.2).”

Ms Mercorella said these tight conditions were not new and suggested a chronic, structural undersupply.

“This quarter the statewide vacancy rate remained at 1.0% and the reality is that it has not exceeded this for the past 21 quarters (since the March quarter of 2021 at 1.3%),” she said.

“You have to go all the way back to the December quarter of 2019 to find the last time Queensland’s statewide vacancy rate sat in healthy territory.

“For just as long, the REIQ has been calling for greater housing supply, both through building more homes and ensuring government policy settings encourage new property investment and give investors the confidence to continue supplying rental housing.

“Following the Federal Government’s significant taxation changes to negative gearing and CGT announced in the May Budget and amid rising interest rates, we can see a pullback in new investor demand.

“ABS data shows mortgage lending has weakened with new loans to investors in Queensland retracting by 10.1% in the June 2026 quarter, compared with an 8.6% decline nationally.

“Further, with strict tenancy laws in Queensland restricting rent increases to once per year, it remains to be fully seen what impact the tax changes could have on rents.”

Ms Mercorella also noted that break leases had become much more common due to relaxed break lease laws and diminished financial liability.

“Property managers are reporting a material increase in tenant driven terminations with many continuing their property search after securing a lease to look for a preferred or cheaper option when one becomes available,” she said.

“While that may reflect the pressure renters are under to secure a home within their budget or preferred location, repeated turnover also creates additional unexpected costs for property owners and understandably this also chips away at property investment appeal.

“Property managers are best placed to advise owners on local conditions and help minimise unnecessary vacancy while ensuring tenancies are managed within Queensland's increasingly complex regulatory environment.”

Fast facts: September Quarter 2026

• Queensland Vacancy Rate: 1.0%
• Capital City Brisbane Vacancy Rate: 1.0%
• Tightest Vacancy Rates: 0.0% in Cook, 0.1% in Charters Towers and Goondiwindi, 0.2% in Maranoa, 0.6% in Toowoomba.
• Highest Vacancy Rates: 6.5% in Isaac, 3.5% in Bay Islands, 2.5% in Noosa (just shy of “healthy”), and 2.2% in Hervey Bay.
• Biggest falls over quarter (less availability): -0.8 percentage points (pp) in Bay Islands (just rebounding from previous quarter), -0.6 pp in Mount Isa, -0.5 pp in Maroochy Coast, Sunshine Coast Hinterland, Gladstone and Burdekin, -0.4 pp in Caboolture and Gympie.
• Biggest rises over quarter: +0.3 pp in Isaac, Noosa and South Burnett.

The REIQ classes rental markets into three categories; tight, healthy, or weak. These markets are classified according to vacancy rates ranges:

• 0 - 2.5% = tight
• 2.6 - 3.5% = healthy
• 3.6% - plus = weak

ENDS

Media enquiries: Claire Ryan, REIQ Media Manager, M: 0417 623 723 E: media@reiq.com.au

REIQ members can download the full vacancy rate spreadsheet here.

Read another media release from the REIQ: Households will hurt from highest interest rate in 15 years.

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