Nation’s Rental Vacancies Drop Below 1pc

Australia’s housing crisis has hit unprecedented levels in all cities and regions with the nation’s residential property rental vacancy rate sinking below 1 per cent and no signs emerging of it bottoming out.

After plateauing over recent months, the proportion of available rental homes dipped to 0.9 per cent in August.

According to SQM Research, the country is now in the grip of its worst rental squeeze for more than 16 years.

“This represents the lowest national rental vacancy rate since 2006 and is at unprecedented levels both in duration and scope when considering the sustained lack of rental properties over the past six months as well as the geographical extent of the crisis,” it declared in a statement.

Overall, the total number of rental vacancies nationwide has fallen to 32,948 residential properties, compressing sharply from 36,741 in July.

Sydney’s vacancy rate fell to 1.3 per cent, its lowest level in a decade, and Melbourne’s to 1.4 per cent, a four-year low, from 1.5 per cent and 1.6 per cent respectively.

Meanwhile, vacancy rates in Brisbane, Perth, Adelaide, Canberra, Darwin and Hobart continue to sit well below 1 per cent.

“The national housing rental crisis has further deteriorated to unprecedented levels,” SQM Research managing director Louis Christopher.

“And rental listings thus far recorded in September would suggest another fall in rental vacancy rates for the current month.”

He said the latest data concurred with the recent “concerning” alerts and warnings by various housing bodies as to what is happening on the ground.

“Asking rents continue to rise across the country at a red-hot pace,” Christopher said. “All capital cities are recording double digit percentage rental increases over the past 12 months.”

Over the past 30 days to September 13, capital city asking rents rose by another 2.6 per cent with the 12-month rise standing at 20.1 per cent. Taking into account all regions, national rents rose by 14.7 per cent for the same period.

Nationally, the median weekly asking rent for a dwelling is now $525 a week. Sydney recorded the highest weekly rent for a house at $845 a week, while Adelaide units are the most affordable rental option of all capital cities at $376 a week.

Meanwhile, latest data from the Housing Institute of Australia has shown new home sales fell by a further 1.6 per cent in August following a 13.1 per cent decline in July.

Victoria drove the declines in sales in August, down by 15.2 per cent, followed by Queensland where sales were down 1.8 per cent. Other states saw increases, including South Australia (18.2 per cent), New South Wales (14.2 per cent) and Western Australia (7.5 per cent).

“Sales of new homes over the past two months are reflective of a slowing in the market as the impact of the rise in the cash rate hits households,” HIA economist Tom Devitt said.

“This rise in borrowing costs compounds the impact of the rise in the cost of construction.

“The full impact of recent and future rate increases will continue to flow through as an adverse impact on the sale of new homes in coming months.”