National housing campaign Everybody's Home says tight rental availability is squeezing renters and underscores the urgent need for more affordable homes.
New figures by CoreLogic and Domain show vacancy rates have fallen to record lows as rents remain unaffordable across the country.
Everybody's Home spokesperson Maiy Azize said governments need to significantly increase the supply of social housing.
"Australia's housing crisis just keeps getting worse. Rents are unsustainably high, pricing people out of their communities and pushing them to the brink," Ms Azize said.
"Hundreds of thousands of people are in rental stress, but there is virtually nowhere for renters to find a cheaper place to live. Renters are reaching an affordability ceiling - there's only so much they can stretch their budgets for the security of a home.
"The private rental market simply isn't delivering affordable homes. The government must boost social and affordable housing to help the growing number of renters who are deep in housing stress, and living on the edge or below the poverty line.
"The government's new investments in social housing must be backed by a plan to end our shortfall of 640,000 social homes. Australia needs 25,000 new social housing dwellings each year to see an end to housing stress, homelessness and overcrowding."
