Vacancies dwindle in Sydney amid rental lull

Although the Sydney and New South Wales rental markets are in a state of uncertainty over the threat of the Omicron variant, vacancies have continued to fall in most areas.

Figures from the Real Estate Institute of New South Wales (REINSW) showed that the rental housing vacancy rate fell to 2.8% in Sydney, due to ;a drop in the number of inscriptions in the inner belt.

During the month, rental vacancies in Sydney's Inner Ring rose from 4.4% to 3.7%.

At the same time, the vacancy rates in the middle and outer crowns remained stable at 2.9% and 1.8%, respectively.

Outside Sydney, there was a slight increase in vacancy in Hunter and Wollongong, which recorded respective rates of 2.1% and 0.8%.

In parts of New South Wales, there have also been some upward and downward movements in vacancy rates.

The Central Coast, New England, North Rivers, Orana and South Coast regions all saw a higher share of available rental properties during the month.

Region

Vacancy rate (%)

December 21

Nov-21

Albury

0.5

0.9

Central coast

1.1

1.0

Center West

0.5

0.5

Coffs Harbour

0.8

1.1

Middle North Coast

0.7

0.8

Murrumbidgee

0.6

0.8

New England

1.1

0.5

Rivers of the North

1.1

0.7

Orana

1.5

1.3

Riverina

0.6

0.6

South Coast

0.4

0.3

Southeast

0.8

1.0

REINSW CEO Tim McKibbin said last month's results were affected by the threat of the Omicron variant COVID.

"We were certainly expecting to see a lull in the market ahead of the holiday season, but REINSW members report that this usual lull was exacerbated in December because people are hesitant about the future as& #39;Omicron continues to spread,” he said.

"As a result, many are delaying their move plans, leaving the market in limbo."

The largest annual increase in rents since 2009

According to Domain's latest rental report, Sydney recorded a new all-time high for weekly rents of $600 in the December quarter, representing a jump of 3.4% or $20.

On an annual basis, rents increased by 9.1% or $50, the strongest growth since 2009.

Meanwhile, unit rents increased by 1% or $5 in the quarter. Interestingly, the unit segment posted its first annual rent gain in nearly four years, up 4.3% or $20.

However, unit rents remain $60 below the record high set in mid-2018.

The Domain report said the race for space among renters working from home amid the closings has pushed demand toward homes.

"This has been evident as strong demand for homes has caused rents to increase more than twice the unit rate over the past year," the report said.

Growth in investment activity, according to the report, could boost supply in the coming months.

Photo by @alnbal on Unsplash.

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