Canberra's average weekly rents have slumped in the past year

Data from Australian Property Monitors, to be released on Thursday, shows Canberra house rents have slumped 6.2 per cent - or about $30 a week - since March last year. Units have fallen 7 per cent.

The March quarter Rental Report shows the territory recorded almost double the fall of Hobart, which had the second-highest decline in rent for units.

House rents in Canberra have dropped 1.1 per cent to $455, from the December quarter, while units have fallen 2.4 per cent to $400.

While rents have been falling for three consecutive quarters, Canberra is still one of the most expensive cities in which to rent.

It is the fourth most pricey capital city to rent a house and equal-third most expensive place to rent a unit.

Nationally, median house rents increased by 1.4 per cent and units were up 2.1 per cent in the year to March 31.

Australian Property Monitors' senior economist, Andrew Wilson, said the significant decline was good news for tenants but not so good for a still underperforming local economy.

''That's a big drop and that's been the most significant fall, or the worst performance I guess, if you're an investor, of all the capitals,'' he said.

Dr Wilson said the fall in rents had coincided with a subdued period for home buying and price growth in the territory.

''I think it's another symptom of what is a low-confidence housing market, both in terms of rents and buying, and I think the underlying driver of that is concerns over job security, which are ongoing,'' he said.

''That's not something that's conducive to confidence in terms of making decisions about renting or buying a home.''

Independent Property Group's managing director of property management, Norm Honey, said rents had been falling recently due to the oversupply of properties.

He said there were about 2600 dwellings available for rent and there should be less than 2000 at this time of year.

But Mr Honey said it had been about two years since the number of properties was that low.

He said several big new developments settling at the end of last year - such as Manhattan on the Park - had attracted tenants, which left many older, established properties available.

Mr Honey said while owners were dropping rents to meet the market, he would need a bit more convincing that the Canberra market had turned in favour of renters.

A similar report issued on Wednesday confirmed Canberra's status as the weakest-performing capital city rental market for the past 12 months, though figures differed slightly.

RP Data's Quarterly Rental Review shows a fall in weekly rents of 5.8 per cent for houses and 4.7 per cent for units in the 12 months to the end of March.

Melbourne was the strongest-performing capital city market for houses, with house price increases of 2.7 per cent.

Darwin recorded the strongest growth for units, which increased by 5.8 per cent.