tightening bike
With rental stock decreasing, it is likely the vacancy rate will tighten further this year. Image – Canva.
  • The national vacancy rate is 1.7% as of December, according to Domain
  • There was a slight increase in the rate between November and December 2021
  • There were just 37,000 vacant dwellings across Australia in December - 31% less than same time last year

Rental vacancy rates remain tight across Australia, according to Domain’s Rental Vacancy Rate report for December 2021.

The report shows the national vacancy rate is 1.7% –  lower than the 2.4% rate recorded in December 2020.

The tight vacancy rate is thanks to a significant decline in vacant properties from 54,000 dwellings in December 2020 to 37,000 last month.

This represents a 31% reduction in vacant rentals, making the rental market far more competitive for tenants.

On a month-on-month basis, there was a slight increase in available properties across most cities, according to Dr Nicola Powell, Domain’s Chief of Research and Economics.

“While we saw a slight increase in the number of available rental properties in December we are very much operating in a landlords’ market,” she said.

“Early in 2022, it’s likely we’ll see decreases in the number of vacant rental properties as strong historical rental demand in January reduces the number of vacant rental listings.

Nicola Powell, Domain

nicola powell
Dr Nicola Powell, Domain. Image – LinkedIn .

According to the report, only Adelaide and Hobart saw no change to their respective vacancy rates.

All the other capitals recorded a month-on-month increase.

However, apart from Darwin, all the capital cities saw a decline in their vacancy rate year on year. Most notably, Melbourne has seen its vacancy rate decline from 5.2% in December to 3% in November before increasing to 3.2% last month.

December 2021 rental vacancy rates

vacancy
Source: Domain

“Rental markets will be under further strain as borders reopen and the flow of international students, overseas migrants and expats resume,” added Dr Powell.

“Sydney and Melbourne are likely to be under greater pressure as historically they have welcomed more overseas migrants than other cities.”

National

SQM Research also shows a decline in the vacancy rate. As of November 2021, the national vacancy rate sits at 1.5% – the lowest since May 2010 where it was at 1.4%. However, current levels remain above certain levels since during the mid-2000s.



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