Vacancy rates continue to fall, dropping in all capital cities except Hobart.

The national vacancy rate now sits at just 0.8% according to Domain.

Its latest rental report shows that Sydney and Melbourne’s vacancy rates have dropped to a record low 1%. The market is even tighter in Perth and Adelaide where the vacancy rate has dropped to just 0.3% while Brisbane sits at 0.8%.

Darwin and Canberra are 1.3% and 1.5% respectively.

Hobart is the only capital city to record an increase in vacancy rates, up marginally to just 0.5%.

Rental listings are down 36% on this time last year.

The report says the return of international and domestic travel, overseas migration and foreign students, and the recovery of temporary visa holder numbers is contributing to the tight market.

Recent changes by China’s Ministry of Education to stop acknowledging degrees gained online will also result in a surge in demand for rentals as students return for in-person classes.