- Vacancy rates remained steady or fell in every capital city
- The rate in Melbourne, however, remains relatively high
- Domain's Senior Research Analyst said asking rents in the inner city have slipped as the vacancy rates remained high
Domain’s latest vacancy rates report for May showed vacancy levels are the lowest since February – just before the pandemic-induced lockdowns occurred.
The national vacancy rate now sits at 1.7%
Across the major capital cities, the vacancy rates either fell or held stable across May, with Sydney, Melbourne, Brisbane, Hobart and Darwin falling while Perth, Canberra and Adelaide remained steady.
Sydney in particular saw levels fall from 2.9% to 2.7%, the same as March 2020. The rate in Melbourne remains relatively high but has been falling rapidly from the 5.4% peak recorded in December last year. In the past three months alone the rate has fallen by 0.9%.
Canberra and Perth are both close to record multi-year lows, while Darwin, Adelaide and Brisbane are currently at their lowest vacancy rate since Domain started collecting such data back in 2017.
SQM Research’s data correlates strongly with that of Domain – the latest national residential vacancy rate is 1.9%, which is the lowest since early 2013.
National Vacancy Rate
[Select part of the chart to zoom in on various years, and ‘reset zoom’ button to return]
Domain’s Senior Research Analyst, Dr Nicola Powell, adds that asking rents have been falling in the inner cities despite the national fall in vacancy rates.
“All cities apart from Melbourne have corrected the COVID induced bounce in vacancy rates, with many of the smaller cities experiencing tighter rental markets than before the pandemic hit,” Dr Powell told The Property Tribune.
“The downward adjustment in asking rents in the inner city of Melbourne and Sydney may have driven a shift in tenants seeking greater value for money.
“Sydney and Melbourne CBDs continue to have elevated vacancy rates favouring tenants, providing them with the power to negotiate rent. As the estimated number of vacant rentals continues to slide, it could be a sign investors are also selling.”
Dr Nicola Powell, Domain Senior Research Analayst
Weekly Asking Rent – Melbourne CBD
[Select part of the chart to zoom in on various years, and ‘reset zoom’ button to return]
As the chart above shows, the asking rent for dwellings such as units and apartments in Melbourne’s CBD has gradually fallen in recent times.
