Melbourne apartment renters could expect lower prices if the number of empty units continues to climb.

The median rent was stagnant over the June quarter, at a record $380 a week, but the city-wide vacancy rate jumped from 2.5 per cent over the month to 2.7 per cent in June, Domain Group’s Rental Report released on Thursday shows.

There is also no relief for house renters, who continue to face a median weekly asking rent of $400.

The local government areas with the highest unit vacancy rates are Maroondah, Manningham and Whittlesea — but lower stock levels could influence their standing.

Domain Group chief economist Andrew Wilson said there was potential for the city’s median weekly rent to fall by year’s end if vacancy rates consistency hit above 3 per cent.

“We are starting to see signs that increased supply is having an impact on the Melbourne market – no sign yet of relief for rents, but there is more choice for tenants for units,” he said. “And once we get 3 per cent and above, we will expect to see some downward movement on rents in units.”

Dr Wilson said there would be a significant number of new apartment completions over the next 12 months and rising investor activity may provide increased supply.

The offset would be strong migration into Victoria and Melbourne and lower numbers of first home buyers, he added.

ANZ economist Daniel Gradwell said oversupply would limit rent growth, as opposed to cause a price drop, over the coming year or two.

“We are seeing a lot of people shifting their preference away from houses and towards the apartment market, given that rents and prices have been growing a lot more slowly in the unit space compared to detached housing,” he said.

LJ Hooker research manager Mathew Tiller said that with more rental apartments becoming available, there was potential for rents to drop for certain type of properties in a handful of inner-city pockets.

He said these included smaller, investor-grade studio and one-bedroom apartments – a significant proportion of the supply under construction – in suburbs such as South Yarra, Docklands, Southbank and the CBD.

“Tenants will be able to negotiate a pretty good deal over the next 12 to 18 months for some of those newly-completed apartments.”

While the proportion of empty houses across Melbourne has increased from 1.6 per cent in May to 1.7 per cent in June, it has significantly tightened from 2 per cent at the same time last year.

Median weekly rents have increased fastest in the inner south, jumping 5.9 per cent in 12 months to a median of $540. The western suburbs were the best performer for unit rents over the year, rising 4.8 per cent to $325 a week.

The Domain Group data comes as PRDnationwide’s 2016 Australia Economic and Property Report revealed Melbourne recorded the second highest growth in median rent for three-bedroom houses of all Australian capital cities over the first half of 2016, at 5.6 per cent.

The city also registered the second highest growth in median rent for two-bedroom units, at 2.6 per cent.