Apartment rents have risen dramatically in the past 12 months with CoreLogic figures showing 57 suburbs recorded rental increases of 20% or more.

At the same time vacancy rates dropped to a new low of 0.9% across the combined capital cities during February.

CoreLogic research director, Tim Lawless says the strong rebound in foreign student and international migrant arrivals will add further pressure to inner-city rentals and areas close to universities and transport hubs.

Lawless says rental growth for houses has slowed in recent months as a result of the higher cost of living.

“We have already seen some evidence that rental growth is topping out, especially in the more expensive low density sector, where rental growth was much stronger through the pandemic,” he says.

“This easing in rental growth has nothing to do with a supply response or less overall demand, it probably has more to do with renters reaching a ceiling on what they are able or willing to pay.”