July 2026
Rents steady, values soften and yields keep improving
Australia’s rental market remains tightly balanced, but there are signs conditions are becoming more measured. While housing value growth has slowed across many parts of the country, rental demand continues to be supported by limited supply, low vacancy rates and steady population growth.
Reducing maintenance before it starts
The cheapest repair is the one that never becomes necessary. Most large maintenance bills start life as small ones.
Why great tenants stay longer
Ask any experienced property manager what makes an investment property perform and the answer is rarely the rent figure. It is the tenant.
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What our clients say
Rents steady, values soften and yields keep improving
June brought a mixed picture for property investors. Home values fell while rental conditions stayed firm, and the combination is quietly reshaping the numbers that matter most to landlords.
Cotality’s national Home Value Index dropped 0.4 per cent in June, the largest monthly fall since December 2022. Sydney declined 1.2 per cent and Melbourne 1.0 per cent, while Perth, Brisbane, Hobart and Darwin still recorded modest gains. National values now sit 0.7 per cent below their March peak, though they remain 7.3 per cent higher than a year ago.
The rental market told a steadier story. Cotality’s national rental index rose 0.5 per cent in seasonally adjusted terms in June, in line with May. Annual rental growth held at 5.9 per cent over the financial year, adding roughly $40 a week to the median rent. Growth ranged from around 10 per cent in Darwin and regional Tasmania to just over 3 per cent in the ACT and regional NT.
Capital city rents up $217 per week
It is worth pausing on what those figures mean for the people paying them. Capital city rents have risen 41.7 per cent over the past five years, around $217 a week, and many tenants are feeling that alongside every other cost-of-living pressure.
Good tenants who pay reliably and care for a property are valuable, and treating them fairly on rent reviews is both the right thing to do and sound business. A sustainable rent that keeps a quality tenant in place often serves an investor better than chasing every dollar the market might allow.
The supply side remains tight. The national vacancy rate was 1.6 per cent in June, up slightly from 1.5 per cent in May but still well below the decade average of 2.5 per cent. Tenants have limited options, which is exactly why well-maintained, fairly priced properties attract and keep the best applicants.
Gross yields continue to improve With rents rising faster than values, gross yields continue to improve. Across the combined capitals the average gross yield reached 3.50 per cent, up from a low of 3.34 per cent in December last year and a record low of 2.92 per cent in January 2022. That said, Cotality notes that variable rateson new investor loans average around 6.4 per cent, and holding costs such as insurance, maintenance and strata fees keep climbing. Research from May suggested fewer than 1 per cent of suburbs currently offer a cash-flow positive opportunity for a leveraged buyer on standard assumptions.
Investor demand softens
Policy is the other watch point. Proposed changes to negative gearing and capital gains tax settings are expected to soften investor demand for established dwellings. How that plays out through the second half of the year is worth following, and it is a conversation to have with your accountant or financial adviser rather than a reason to act hastily.
For landlords, the practical takeaways are straightforward. Values may drift for a while, but rental demand remains strong, yields are improving, and the tenants you already have are worth looking after. If you would like to talk through how your property is positioned, we’re free for a chat anytime.
Gross Rental Yields Nationally
Sydney 3.3 %
Melbourne 3.9 %
Brisbane 3.3 %
Adelaide 3.5 %
Perth 3.7 %
Hobart 4.4 %
Darwin 6.1 %
Canberra 4.2 %
National 3.7 %
Reducing maintenance before it starts
The cheapest repair is the one that never becomes necessary.
Most large maintenance bills start life as small ones. A slow leak becomes water damage. A blocked gutter becomes a ceiling stain. The properties that cost the least to run over time are the ones where small issues are found and fixed early, before they grow into something bigger.
This is where regular routine inspections earn their keep. A good property manager is not just checking how the tenant is caring for the home. They are looking for early warning signs: minor cracks, worn seals, ageing hot water systems and trees creeping towards gutters. Arranging preventative work through trusted trades at the right time costs far less than an emergency call-out later. Three things worth having in place:
- A schedule of preventative jobs such as gutter cleaning, smoke alarm servicing and hot water system checks
- Prompt attention to tenant-reported issues, however small they seem
- A plan for ageing items like appliances and fencing, so replacements are budgeted rather than sudden
Well-maintained properties also keep good tenants longer, which protects your income in a way no repair ever could.
Why great tenants stay longer
Ask any experienced property manager what makes an investment property perform and the answer is rarely the rent figure. It is the tenant. A reliable tenant who pays on time, cares for the home and renews their lease year after year is worth more to an investor than almost anything else. So it is worth understanding why great tenants stay, and why they leave.
The real cost of a vacancy
Every change of tenant carries a cost. There is the vacant period itself, often two to four weeks of lost rent, plus advertising, cleaning and the time spent finding the right applicant. A fortnight of vacancy can wipe out the gain from a modest rent increase for the entire year. That is why experienced property managers weigh every decision, from rent reviews to repair requests, against one question: does this make a good tenant more or less likely to stay?
What tenants actually value
The reasons tenants renew are remarkably consistent, and they are rarely about the property being fancy. They stay when:
Repairs are handled promptly and they feel heard when they report a problem
The home is safe, functional and well maintained
Rent increases are fair, explained and grounded in the market rather than sprung on them
Communication is respectful and reliable in both directions
None of this is complicated. But it requires consistency, and it is where professional management makes the biggest difference. A property manager who responds to a maintenance request within a day sends a message no welcome card ever could: you matter, and this home is looked after.
Fair rent reviews keep good tenants Rents have risen significantly in recent years, and many tenants are stretched. A property manager’s job is to recommend a rent that reflects the market whilerecognising the value of the tenant already in place. Pushing a reliable tenant out with an aggressive increase, only to face a vacancy and an unknown replacement, is a poor trade. The strongest long-term returns tend to come from properties where the rent is sustainable and the tenancy is stable.
Small gestures, long tenancies
Beyond the fundamentals, small things build loyalty. Approving a reasonable request to hang pictures or keep a well-behaved pet. Scheduling non-urgent work at a time that suits the tenant. Giving plenty of notice before inspections. Each one signals respect, and respected tenants treat the property accordingly. Many of the longest tenancies we see share the same trait: the tenant feels the home is theirs to live in, not just an asset they happen to occupy.
Why it matters for landlords
Stable tenancies mean fewer vacant weeks, lower re-letting costs, less wear from constant turnover and a property history that appeals to future buyers. Tenant retention is not a soft measure. It is one of the most reliable drivers of investment performance there is.
Do this next
Before the next rent review, ask for a recommendation that balances market evidence with the value of keeping your tenant
Ask your property manager how long your current tenant has been in place and what would encourage them to renew
Review how quickly maintenance requests on your property are being resolved
We put you first
We strive to consistently deliver the best possible customer experience by putting your interests first.
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Katie Schoonbeek is the ultimate property manager. She consistently goes above and beyond to ensure every aspect of property management is handled professionally, efficiently, and with great attention to detail. What truly sets Katie apart is the high level of personal service she provides—she is approachable, proactive, and genuinely cares about both property owners and tenants. Her communication is excellent, and she makes the entire process seamless and stress-free. I have complete confidence that everything is being looked after when Katie is managing a property. I would highly recommend her to anyone looking for an exceptional property manager.
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Katie has been helpful in our new tenancy requirements. Very friendly and professional
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Absolutely amazing, Katie is amazing and professional
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Katie and the team were incredible. Organising inspections and discussions with our landlord and getting me into the property with minimal fuss. Great communication, great response times, always listening. Thanks Katie.
