It’s incredible how fast market dynamics can change. At the beginning of spring 2020, with vacancy rates blowing out across Australia, tenants appeared to have considerable time on their side to find a suitable rental property.
Fast forward to the start of autumn 2021, and vacancy rates have plummeted, especially in many major regional markets. According to a report from Domain, nationally, the vacancy rate of 1.9% is the lowest since March 2020, the month before the COVID-19 induced peak of 2.6% in April 2020.
In certain areas, competition between tenants will be fierce as tight vacancy rates prevail, such as Tea Tree Gully in South Australia and Caboolture on the Queensland Sunshine Coast, where rental vacancies of 0.1% are the lowest in Australia according to the Domain research. With a vacancy rate of 0.2%, Wanneroo is the weakest in Western Australia, just below the 0.3% recorded by Victoria’s Mornington Peninsula. There’s little doubt that the shift away from the major capital cities to regional centres during COVID is responsible for these record low vacancy rates.
Likewise, times are challenging for tenants in Australia’s smaller capitals which were not affected to the same extent as Sydney and Melbourne by restrictions and lockdowns. Hobart, for example, has reported a rental vacancy rate of just 0.5%. Vacancies are also tight in Adelaide (0.6%), Perth (0.7%), Canberra (0.8%) and Darwin (0.8%).
But while the pandemic caused many tenants to seek accommodation in regional Australia and the smaller capitals, the Domain data indicates the tide is turning in Melbourne and Sydney, with vacancy rates sliding from their COVID-19 peaks.
While this means the worst is behind landlords particularly with properties in inner-ring capital city suburbs, it implies something vastly different for renters. Indeed, for tenants considering a move soon, it might be worth getting your skates on and finding a suitable rental property before the Sydney and Melbourne vacancy rates return to pre-COVID levels.
To find a suitable rental property, contact your local Raine & Hone Property Manager.