Interesting release from SQM Research this week detailing vacancy rates by capital city for the month of May 2014.
Nationally, SQM recorded vacancy rates as having fallen marginally to 2.2% in the month, which compares to 2.0% from the corresponding prior period in 2013 (click chart):
Melbourne continues to notch the highest vacancy rates largely thanks to the city having built so many apartments over the last decade.
It doesn't appear to have quelled dwelling price growth in existing stock too effectively to date, but perhaps that will filter through in due course.
The most significant increase in vacancy rates over the past year was recorded in Perth as the mining construction boom transitions to mining export boom in Western Australia, just as it does elsewhere.
It used to be said in days gone by that a market "in equilibrium" had a vacancy rate of around 3%, but that old rule thumb seems to have tiptoed out of vogue now.
Notably, there are a number of markets with exceptionally tight vacancy rates, which now include most of Darwin in the Northern Territory, parts of Adelaide in South Australia and Sydney in New South Wales.
Darwin has been a wretchedly tight market for years, while Sydney's headline figure of only 1.7% disguises that the outer suburbs are actually dragging the averages up.
The detailed suburb data of SQM Research (backed up by REINSW data) shows that many of Sydney's inner suburbs have extraordinarily tight vacancy rates.
This can hardly be described as surprising given the diabolical level of supply response in Sydney over the past eight years, which merely reinforce just how daft some of the apocalyptic predictions of a calamitous price correction really were.