Canberra's rental prices among the nation's most expensive

 Canberra house rental prices increased by 4.4 per cent over the past year and unit rents rose 1.3 per cent.

“Although vacancy rates held steady they remain very low, indicating the likelihood of future rent rises in Canberra,” Dr Wilson said

Canberra and Hobart had the lowest residential vacancy rate in the country with 1.5 per cent across both house and units.

“Canberra’s vacancy rate was 3.1 per cent in the March quarter of last year and it’s now holding at 1.5 per cent and that is quite a dramatic fall,” Dr Wilson said.

Dr Wilson said there has traditionally been a shortage of rental properties in Canberra and there was a high demand for mid to high-level properties.

“Canberra is an expensive place to rent and I think that’s because of higher incomes,” Dr Wilson said.

“That attracts more owner occupiers than tenants and with higher income levels, those that do come in for a rental property are looking at a higher price point.”

Real Estate Institute of the ACT spokesman Craig Bright said he has observed a recovery in the market over the past few months.

However, he said that high-end property that typically hits the market early in the year can lift the median rental price during the first quarter.

“There has definitely been a recovery in the market in the last three or four months,” Mr Bright said.

“Canberra has been playing a bit of catch up and it’s in a recovery phase back to where it was four or five years ago.”

Dr Wilson said it was also interesting to see unit prices rising and he attributed this to the growing appeal of apartments, which still offer a more affordable alternative to detached housing.

“It’s becoming a very expensive place to rent, particularly compared to the median house price,” Dr Wilson said.