In the past decades, when São Paulo became the national manufacturing centre, it has experienced great population growth. Since then, many housing problems have emerged. In addition, the difficulties that inner cities face in attracting jobs and maintaining economic activities are particularly challenging. Indeed, even if many cities have successfully regenerated their central areas, the so-called inner city problem is still very much alive in the case of São Paulo. As a result although the city centre has abundant urban infrastructure it still has plenty of vacant spaces, including residential buildings. One could say that São Paulo’s city centre is characterised by a large number of empty spaces in an area that is simultaneously crowded with buildings and urban facilities. This paper intends to contribute to the empirical analysis of the determinants of vacancy rates, with a particular focus on historical city centres, using São Paulo Metropolitan Area as our case study. Our empirical analysis relies on district-level data for the years 2000 and 2010, and combines standard spatial econometric methods with hedonic modelling. Our results suggest that there are three main groups of determinants: individual buildings characteristics, mobility of households and neighbourhood quality. We find evidence that the historic central city is a distinctive submarket, needing special urban policies. Its determinants work differently when compared with the housing markets of other areas across the city.