Vacancy rates drop, big city rents jump: SQM
Staff ReporterDecember 7, 2020
The number of residential vacancies dropped in August to give a vacancy rate of 2.3 percent, according to SQM Research.
The latest SQM research shows vacancies dropping in all capital cities, pushing up rents, especially in Sydney and Melbourne where vacancy rates are now below 2 percent.
SQM Research managing director Louis Christopher said Sydney and Melbourne recorded vacancies rates of 1.7 percent and 1.9 percent, respectively, while Hobart had the tightest rate at just 0.5 percent.
"In contrast, Perth recorded the highest vacancy rate of 5.0 percent in August, though it fell by 0.2 percentage points from a record high of 5.2 percent in July," he said.
"Reflecting a high vacancy rate, Perth has recorded big falls in asking rents of 9.6 percent for houses and 11.4 percent for units over the past 12 months.
"Yearly falls have also been recorded in Darwin, with asking rents down 1.5 percent for houses and 5.5 percent for units. In contrast, asking rents jumped in Canberra, up 12.1 percent for houses and 9.6 percent for units. The asking rent for a three-bedroom house in Sydney jumped 4.8 percent to $713 a week over the year to September 20 and in Melbourne, rents jumped to $486, up 3.4 percent.
"Despite a very tight vacancy rate, Hobart continues to record the most affordable rental accommodation with rents for houses at just $343 a week and units averaging $279 a week.
"Despite a very tight vacancy rate, Hobart continues to record the most affordable rental accommodation with rents for houses at just $343 a week and units averaging $279 a week.
"Looking forward, fears of an apartment oversupply in Melbourne, if true, cannot come soon enough, as at present, having a vacancy rate trending down below 2 percent is highly suggestive that landlords are in control of the market.
"Sydney too is likely to remain a landlord's market as the city's growing population creates demand for new stock. The only area right now recording sustained increases in vacancies is the Hills District, including the Kellyville area."
"Sydney too is likely to remain a landlord's market as the city's growing population creates demand for new stock. The only area right now recording sustained increases in vacancies is the Hills District, including the Kellyville area."