National rental vacancy rates decreased in August

From

SQM Research has revealed the national residential rental vacancy rate recorded a decrease over the month from 2.1% in July to 2.0% in August 2020.  The total number of vacancies Australia-wide is now at 69,971 vacant residential properties.  This time last year, the national vacancy rate was slightly higher at 2.2%.

All capital cities recorded declines in vacancy rates over the month except for Melbourne which again recorded an increase from 3.1% in July to 3.4% for August. There are now an extra 2,145 vacant properties in Melbourne as the stage 4 Covid-19 lockdown continues.

Sydney currently still has the highest vacancy rate in the nation of 3.5%, having declined by 0.1% from July.  Hobart’s vacancy rate is the lowest in the nation at 0.7%, with Canberra and Adelaide also recording low vacancy rates of 0.8% and 0.9% respectively

 

 

Some Capital City CBD locations have recorded vacancy rate declines over the month, with Sydney CBD dropping to 12.9%, down from its all-time high of 16.2% in May.  Brisbane CBD’s vacancy rate decreased to 11.4% down from its high of 14.0% in June.

However Melbourne’s CBD has increased to a new all-time high of 10.0%, up from 8.8% in July. Adelaide CBD has also increased from 7.6% in July to 8.4%.  Perth CBD has remained stable over the month at 5.5%.

Most regional locations recorded falls in rental vacancy rates, highlighting the ongoing shift away from inner suburban living into areas offering more room and distancing for occupiers. Sydney’s Blue Mountains fell to a record low rental vacancy rate of just 0.7%, as did Victoria’s Mornington Peninsula.  While Queensland’s Ipswich fell to just 0.9%.

Asking rents

Over the month, Capital City average asking rents decreased 1.1% for houses and 0.7% for units for the week ending 12 September 2020 to record asking rents of $529 per week for houses and $414 per week for units.

Most capital cities recorded declines in both house and unit rents except for Perth and Darwin.  Darwin recorded the highest rental increases in the country – up 6.0% for house rents and 1.0% for unit rents.

Hobart recorded the highest decline in unit rents of 4.3% and Sydney recorded the highest decline in house rents of 1.7%.

Adelaide recorded a 0.4% increase in house rents but a 0.4% decline in unit rents.

Year on year, Sydney, Melbourne, Brisbane and Hobart also recorded declines in asking rents for both houses and units, Sydney in particular recording a high 8.0% decline for houses and 8.1% decline for units in August 2019.

 

 

Commentary

Louis Christopher, Managing Director of SQM Research said, “The shift towards regional living continues at pace, largely at the expense of higher inner city rental vacancy rates. I suspect there will have to be a high point in this move soon. However, I also suspect there will be a degree of permanency with the massive population shift. Meanwhile Sydney and Melbourne rents continue to fall providing leasing opportunities for tenants who have chosen to stay in town.”

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