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Tuesday, 18 February 2020

Rental vacancies tumble, having peaked

Rental vacancy declines

Apologies, been a bit quiet on the blog due having been, ah, busy...

Australia's greatest ever construction boom has caused some headaches for landlords since 2016, with a record volume of supply hitting the market.

However, vacancies have now peaked in Sydney, Brisbane, Perth, and Darwin, according to SQM Research's latest, er, research. 

JLL noted in its latest quarterly that inner city apartment completions had shrunk by a fifth, and the supply is now set to tighten. 

In Sydney the rental vacancy rate tumbled from 3.6 per cent to 3.1 per cent in January, despite the potential for challenges related to the return of Chinese students. 

Perth's vacancy rate is now down to just 2.1 per cent, while Brisbane isn't too far behind on that curve at 2.4 per cent. 

Adelaide's vacancy rate is now very tight at just 1 per cent, and following on from Hobart looks set to be the next city to see a sudden 'pop' in rents and prices. 

Nationally the vacancy rate at 2.1 per cent is now tracking lower than a year earlier, with supply set to slow considerably through 2020. 

The annual growth in Chinese short-term arrivals fell to its lowest level in almost a decade in December - and that's before the coronavirus kicked into gear - so that's an issue which as yet remains unresolved. 

Sydney and Melbourne recorded increases in asking rents for houses and units in January.