SQM Research has revealed national residential property rental vacancy rates continued to rise to 1.2% in April 2023. This marks the third consecutive monthly rise in rental vacancies.
The total number of rental vacancies Australia-wide now stands at 36,785 residential properties. Rental vacancy rates in Sydney and Melbourne rose to 1.4% and 1.2%, respectively. Brisbane, Perth and Hobart recorded rises to 1.0%, 0.6% and 1.6%, respectively. The number of rental vacancies in Hobart has now tripled since the all-time lows recorded in April 2022.
Rental vacancy rates in the Sydney CBD, Melbourne CBD and Brisbane CBD also increased rapidly to 4.0%, 3.3% and 1.7%.
Most regional rental vacancy rates continued to rise sharply as a sign of a population flow reversal back to the larger capital cities. The North Coast NSW rose to 1.8%. Sydney’s Blue Mountains rose to 2.0%; the highest level since April 2020. Victoria’s Mornington Peninsula rose to 1.7%; the highest level recorded since April 2020. Gold Coast Main rental vacancy rates rose to 1.3%; the highest level recorded since September 2021. Sunshine Coast rental vacancy rates rose to 1.6; the highest level recorded since May 2020.
The latest figures reveal Canberra’s rental vacancy rate rose to 2.0%, which SQM Research believes marks the end of the rental crisis in our Nation’s Capital and a rental market retuning to equilibrium. Gungahlin and the Inner North ACT recorded sharp increases in vacancies. Hobart also rose sharply to 1.6%, indicating the city may soon be out of its rental crisis.
SQM’s calculations of vacancies are based on online rental listings that have been advertised for three weeks or more compared to the total number of established rental properties. SQM considers this to be a superior methodology compared to using a potentially incomplete sample of agency surveys or merely relying on raw online listings advertised. Please go to our Methodology page for more information on how SQM’s vacancies are compiled.
Rents
Over the past 30 days to 12 May 2023, capital city asking rents rose by 0.4% with the 12-month rise standing at 20.7%. Capital city house rents rose by 0.1% and are recording 12 month increases of 17.7%. Apartment rents have risen by 0.7% for the past 30 days and rose by 24.2% for the past 12 months.
The median rent for a capital city house is $757 a week while the rent for a capital city unit is $579 a week.
Perth units recorded the fastest increase for the past 30 days, rising by 2.2% to $521.58 a week.
The most expensive rent is Sydney houses at $963 a week. At the same time the most affordable rent is Adelaide units at $414 a week.
Hobart and Canberra are the capital cities to record a decline in rents for the month; each recording falls of 0.4% for combined dwellings. This marks the second consecutive monthly decline in rents for both these cities.
Meanwhile a large number of regional rents fell, dragging the national rental median rent to an unchanged result for the past 30 days. The 12 month change in median national rents now stands at a 10.1% increase. The national median weekly asking rent for a dwelling is $568 a week.
ACT’s Belconnen fell by 0.8% to $599.60 a week. Sydney’s Blue Mountains fell by 0.7% to $542.50 a week. Gold Coast Main rents fell by 1.1% to $881.07 a week. NSW Central Tablelands Tablelands fell by 2.0% to $464.50 a week.
Louis Christopher, Managing Director of SQM Research said: “SQM’s latest data on the rental market, represents some respite for renters across the nation. I believe tenants have been responding to the rental crisis by grouping together more, which can free up some rental stock. And/or an increasing number of tenants have been turning themselves into First Home Buyers. It is likely many Landlords have been overly exuberant in seeking rent increases which have driven renters away.
“For regions outside our capital cities, I believe there has been a population exodus back to our larger cities, driven by a return to office requirement set by many office employers. We are now recording rental falls or at least a stalling in rent increases for most out of city regions around Australia. Existing property investors and would be property investors need to be aware the risks have risen of a corresponding and extended dwelling price correction in such regions.
“What is apparent from today’s data is that the rental crisis is easing in the Nation’s regions as well as some of our smaller capital cities including the Nation’s Capital where we are now confident in calling the rental crisis over.
“Going forward, it is way too early to call the rental crisis over in our larger capital cities. The building slump, combined with extremely strong population growth rates will see to it there will remain an overall shortage of rental properties. We note however weekly rental listings nationwide have increased so far in the month of May by another 3,000 rental listings. So, it is likely we will record another rise in rental vacancy rates across the nation for this current month.”
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