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Tuesday, 16 June 2020

Vacancies now declining

Vacancies pass peak

National residential vacancy rates declined from 2.6 per cent to 2.5 per cent in May 2020, driven by declines in Brisbane, Perth, and Darwin, according to SQM Research.

Brisbane's vacancy rate fell from 2.8 per cent to 2.5 per cent, while in Perth the vacancy rate fell from 2.3 per cent to just 2.0 per cent. 

There's also been a decline in the supply of listings in the first half of June per SQM Research, suggesting that the peak for rental vacancies came and went about six weeks ago. 

Airbnb owners have now pulled back from listing on the open rental market, instead opting to await the reopening of Australia's borders.

The Central Business Districts of Australia's cities tend to have more short-stay tenants, and the respective vacancy rates in the capital city CBDs remain very high for now.

Source: SQM Research

Vacancies were also especially high at Melbourne's South Bank and at Palm Beach in NSW.

Sydney's vacancy rate sits at 4 per cent, largely driven by the 16 per cent vacancy rate in the NSW 2000 postcode.

Rental listings now falling

Previous figures from SQM showed that total rental listings peaked at more than 105,000 in the last week of April 2020, thus correctly anticipating the turning point.

Total rental listings fell from 105,277 on May 9 to 98,061 on June 9, for a decline of 7,216 listings or 7 per cent over the month.

Therefore, vacancy rates are normalising and are now looking set to decline in the month of June and beyond. 

Top research work from Louis Christopher and the team at SQM Research as always.

With 122,000 international students stuck overseas, a reopening of the border could quite quickly lead to tighter rental markets.

Source: Aus Gov