- It's the third consecutive month vacancies have been 1.6%, according to Domain
- Vacancies in Sydney remain at 2.6%, higher home prices keeping tenants renting longer
- Other capital cities currently at or near record low rates under 1%
For the third consecutive month, the national rental vacancy rate has remained at 1.6%, according to Domain, while SQM Research had a similar rate of 1.7%.
Nationwide Vacancy Rate 1.7% (SQM Research)
Although Sydney has been in lockdown for more than two months, it appears this had minimal impact. The vacancy rate in the nation’s largest city is 2.6%, reflecting the high demand for rental properties. 3% is often seen as a ‘balanced’ market, so anything below this is seen as ‘tight’ (undersupplied.)
With house prices still growing, rental demand will likely continue, said Domain’s Dr Nicola Powell.
“It is possible that affordability constraints of purchasing a home in Sydney is a barrier for tenants, keeping them renting for longer,” she said.
“Also, rapidly rising prices may have led to reduction in rental stock, as landlords chase capital growth on their investment properties.”
Dr Nicola Powell, Domain
In Melbourne, however, vacancy rates have increased to 3.8% due to multiple lockdowns and harsh restrictions. This is better news for tenants who may be able to negotiate cheaper rates.
“Melbourne entered its sixth lockdown over the month, shifting the trajectory of the rental market,” explained Dr Powell.
“The supply of vacant rentals was previously shrinking, although this has firmly turned following a two-month streak of more vacant rentals. This could provide further bargaining power for tenants.”
In other cities such as Hobart, Brisbane, Adelaide and Darwin, a landlord’s market continues with vacancy rates hovering around multi-year lows, allowing landlords to leverage this to increase rent.
Hobart and Adelaide have a vacancy rate of 0.5% and 0.6% respectively, with Perth recording a rate of 0.7%.
While Sydney tenants are currently protected by the rental moratorium, Melbourne’s ended earlier this year.
In terms of areas with the lowest vacancy rates in the five largest capital cities: Camden in Sydney has a rate 0f 0.4%, Mornington Peninsula in Melbourne at 0.5%, Caboolture – Hinterland in Brisbane at 0.3%, Gosnells in Perth at 0.2% and Marion in Adelaide also at 0.2%.
Marion, SA (Postcode 5043)