The national residential vacancy rate fell further to a low of 2.1% in March 2019, with four of the eight capital cities recording vacancy rates between 0.4% and 1.6%, according to SQM Research.
Canberra is the only capital city to increase its vacancy rate from 0.8% in February to 0.9% in March 2019, but continues to have the second lowest rate among the capital cities. Hobart, steady at 0.4%, remains the city with the tightest rental market.
Sydney, Melbourne, Brisbane, Perth and Adelaide all experienced a 0.1% decrease in vacancy rates in March.
Sydney currently has the second highest vacancy rate at 3.1%, despite improving from 3.2% in February.
Darwin’s vacancy rate is now 3.7% as the city continues to rank the highest of all capital cities since it overtook Perth in September 2018. Perth’s vacancy rate has dropped from 4.1% a year ago to 2.9% in March – and was the only city to record increases in asking rents for both houses and units during the month.
But in annual terms rents are rising in most cities. SQM’s Louis Christopher says: “Hobart’s near double-digit growth in asking rents for units reflects the ongoing strong demand in a city where rental supply has been pushed to its limits and experiencing shortages in accommodation.”
For the record, Australia’s national vacancy rate has not exceeded 3% since SQM Research began collating vacancy rate data in 2005.
Almost every regional area in NSW, Victoria and Queensland has recorded rental increases in the past year, according to Domain.
Affordability, tree-changers and government investment were the main drivers for the uptick in rents in different regional areas, according to Domain’s senior research analyst Nicola Powell.
She says regional towns within commuting distance of Sydney and Melbourne remain popular, such as Wollongong and Geelong, but more far-flung towns are proving attractive too.
“Your Oranges have been on the radar of people leaving Sydney,” Powell says. “It’s big enough to offer the job opportunities but small enough to provide the lifestyles that families are after.”
But government and private investment in particular towns are also attracting more people to regional areas and putting pressure on rents.
The few towns that recorded declines or remained flat were in sync with their respective capital city, said Dr Powell, yet still recorded a strong rental increase over five years.