As we head into 2026, Sydney and Melbourne’s apartment markets remain underpinned by strong rental demand, low vacancy rates and ongoing supply constraints. For landlords, investors and property managers, the outlook points to another year of competitive leasing conditions, with Built-to-Rent (BTR) playing an increasingly influential role.
Apartment Rents in 2026: Growth Continues
Apartment rents in both cities are expected to rise again in 2026, although at a more moderate pace than recent years. Strong population growth, affordability pressures and limited new supply continue to push renters toward apartment living, particularly in well-located inner-city and middle-ring suburbs.
Sydney is forecast to see stronger rental growth, while Melbourne’s market remains tight and competitive, especially for quality, professionally managed apartments.
Supply Constraints and the Growing Impact of BTR
New apartment supply remains constrained due to construction costs and feasibility challenges. This ongoing shortfall is keeping vacancy rates low and supporting rental growth.
Built-to-Rent is helping to ease some pressure by adding purpose-built rental stock, particularly in Melbourne and increasingly in Sydney. While BTR won’t resolve the supply imbalance on its own, it is becoming a core part of the rental market and helping meet demand for long-term, secure apartment living.
Leasing Trends: Changing Tenant Expectations
The growth of BTR is reshaping tenant expectations across the broader apartment sector. Longer lease options, quality amenities and professional management are increasingly seen as standard.
For traditional apartment landlords, this highlights the importance of presentation, maintenance and responsive management. For property managers, tenant experience and retention will be key differentiators in 2026.
Looking Ahead
The apartment rental market in Sydney and Melbourne is set to remain resilient in 2026. Strong demand, limited supply and the continued expansion of Built-to-Rent will support rental growth and sustained leasing activity.
For property owners, apartments, across both traditional and BTR models, will continue to offer long-term opportunity in an evolving rental landscape.
To see how we can help you get the most from your property investment this year, please get in touch.
