Record vacancy rates in rental properties across the nation are a landlord's and investor's dream scenario. As renters queue in droves for limited housing, returning students, visitors, and businesses all vie for what little in residential housing is left and available for rent.
"All capital cities are now operating in a landlord's market, the first time this has happened since Domain records began"
Nicola Powell (Domain)
Sydney fell to a Domain record low of 1.4 per cent vacancy rates since recording began in 2017. Perth and Canberra dramatically fell to their lowest in history, with only 0.5% of available properties left for renters.
Adelaide took the top percentage, recording 0.2 per cent – the lowest vacancy rate across any capital city since Domain started tracking the series.
In Melbourne, the vacancy rate fell to 1.8 per cent, the lowest level since the onset of the pandemic.
Available rental homes across all the capitals dropped below 2 per cent, indicating a big move in favouring investors.
Typically, we house hunt in a marketplace of around 3 per cent vacancy rates nationally. This average balance in residential property availability sustains our future demand for residential and rental housing in Australia.
The available Aussie property market was already disastrous before covid and floods or Putin's shenanigans. With historic housing lows, it will only intensify with more competition and affordability issues.
Residential lessees should expect to pay a bit more rent very soon.
If up to six impending interest rate rises occur as predicted by our big banks, it is an intelligent move for landlords to increase rents to stay on top of rising costs.
There are always owners, agents and landlords that will capitalise on the opportunity (I can't blame them; it's business), and renters should be cautious when applying for a new home.
Federal Vs. State
We've mentioned in previous articles that our PM has advised property owners and landlords "To do the right thing." Still, renters should prepare for the rising rents this year with or without some acceleration of a national scheme or long-term affordability policy.
The federal government is leaving it to the states again as they embrace opportunities and issues with affordability. A new strategy to take on the current marketplace is the Victorian Government's Affordable Housing Rental Scheme, and part of the 5 billion Big Housing Build.
Homes Victoria's Affordable Housing Rental Scheme will deliver over 2,400 rental homes to address affordability pressures in metro Melbourne, regional city centres, and supply issues in regional Victoria.
The Northern Territory's Rent Choice has invested 3 million in rental subsidy schemes delivered by Venture Housing Company, targeted at alleviating rental pressure for eligible workers in priority industries in the NT.
Election mode will heighten property issues and allow both sides of politics to make promises about meaningful change.
All state and federal political sides have already made this election about affordability (and we're only on day one of the campaigns, officially); as basic living costs rise, will a national and or state-based solution be offered within the affordable rental market.
There are promising editions from state governments; with a national election based on living affordability, it will be interesting to see what's on offer from the feds in the next six weeks.
Let's wait and see what Albo and Scomo have to say.
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Until next time and thanks for yours!