The number of rental properties sitting vacant in Sydney have continued to surge, new figures show, putting pressure on landlords to cut rental prices.
Almost one in six rental properties in Sydney's CBD (16.2%) were vacant in May.
Sydney's residential vacancy rate is now the highest in the country and the highest on record since 2005, according to SQM research, rising to 4% in May.
There are now over 29,416 rental properties sitting empty across Sydney - the result of a decline in international students and holidaymakers with Airbnb rentals becoming available on longer-term leases.
Melbourne's vacancy rate also increased to 3.1% in May, while Canberra jumped by 0.1% to 1.3%.
Buying an investment property or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for investors.
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Yard Investment Loan (Principal and Interest) (LVR < 80%)
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Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of May 22, 2022. View disclaimer.
Despite the spike in vacancy rates in Sydney and Melbourne, the national vacancy rate has actually slipped.
The national vacancy rate fell marginally from 2.6% in April to 2.5% in May.
Adelaide (1.2%), Hobart (1.2%) and Brisbane (2.5%) dragged down the national vacancy rate.
SQM Managing Director Louis Christopher said we may now be hitting a short-term peak in vacancies.
"Weekly rental listings suggest a slight decline in supply for the first half of June. I think what is happening here is AirBnb property owners have now pulled back from listing long term and are now waiting this time out in the hope that the borders will be open shortly," Mr Christopher said.
"However, with an expected 170,000 dwelling completions for this year and still no imminent opening of the international border, I still think rental vacancy rates are going to remain elevated for 2020.
"While First Home buyer grants may assist in soaking up some of the new supply, let's just remember the bulk of underlying demand growth in recent years has come from net migration. Also note that many first home buyers are tenants."
The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.
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