Rents continue to rise Australia-wide, pressured by rising house prices, a lack of new home construction and cautious investors, according to the latest report from Mortgage Choice and the Real Estate Institute of Australia.

The report finds that vacancy rates across the nation are at historic lows, averaging 1.9% in the September quarter. REIA president Noel Dyett says a vacancy rate below 3% is regarded as an under-supply.

House rents have risen 9.3% in Sydney and 10.6% in Melbourne, but Darwin (where the vacancy rate is below 1%) is the most expensive city for tenants, with the median three-bedroom house rent up 34% to $440 a week over the past 12 months.