Aussie rental pool shrinks as population continues to boom
National vacancy rates fell by 1700 in September despite the Aussie population surpassing 27 million earlier this year. And it is expected to get it even tougher. Here’s why!
A further 1700 rental properties disappeared from Australia’s rental market in September despite the nation’s population surpassing 27 million earlier this year.
That decrease represents a 1.2 per cent drop, or 1733 rental vacancies in one month alone, according to the latest SQM Research National Vacancy Rates report.
It comes after the ABS recently revealed that Australia’s population hit 27,122,411 at the end of March, an increase of 2.3 per cent or 615,3000 in 12 months.
“The total number of rental vacancies now stands at 37,932 residential properties, a decrease
from 39,665 in August 2024,” the SQM report said.
“Perth, Canberra, and Hobart plus regional Australia were the main drivers to the decline. “While all other capital cities were steady or recorded slight rises.”
Adelaide maintained one of the lowest vacancy rates at 0.6 per cent, while Perth also shrank to 0.6 per cent.
Sydney’s rental vacancy rate remained stable at 1.6 per cent, now with 11,360 rental dwellings vacant.
Melbourne’s vacancy rate increased to 1.7 per cent, with 8796 vacant dwellings, reflecting a 0.1 per cent rise from August.
Canberra recorded the highest rental vacancy rate among the states and territories at 2 per cent.
“Vacancy rates in the CBDs were largely steady,” the report revealed.
“Sydney recorded a 5 per cent vacancy rate while Melbourne CBD recorded a slight decrease to 5.1 per cent.
“Brisbane CBD continued to experience strong demand with a low vacancy rate of 2.4 per cent.”
Meanwhile, Darwin’s vacancy rate increased to 1 per cent.
The research showed there were just 215 rental vacancies in Hobart in September, 267 in Darwin and 1002 in Adelaide.
Perth had 1119, Canberra had 1198, Brisbane had 3737, Melbourne 8796 and Sydney had 11,360.
“Over the past month leading up to 12th October 2024, rental prices in capital city asking rents exhibited mixed trends,” the report revealed.
“Total capital city advertised rents rose by 0.5 per cent. Sydney experienced a 0.9 per cent increase in combined rents, reflecting a turnaround from a fall in rents over winter.
“Conversely, Melbourne recorded a 1.1 per cent decline, indicating a softening in rental demand.”
In Brisbane, combined rents rose by 1.5 per cent, showcasing a healthy increase, according to the report, while Perth also exhibited growth with a 1.7 per cent rise, marking it as one of the stronger performers.
“Meanwhile, Adelaide encountered a decrease of 0.2 per cent, signalling a slight downturn in rental prices,” the report noted.
“Canberra experienced a significant drop of 3.4 per cent in housing rents, highlighting a notable shift in demand.
“Hobart’s combined rents increased modestly by 0.3 per cent, continuing a stable trend.
“In contrast, Darwin faced a substantial decrease of 4.5 per cent, pointing to a marked decline in rental demand.
“On a national level including all regions, median advertised rents recorded an increase of 0.8 per cent, suggesting some tightening in rental conditions in regional Australia.”
Sydney recorded the highest median rent for house at $1045.71, while Hobart units were the cheapest at $452.71 a week.
“National rental vacancy rates fell slightly again in September, and we are expecting
another fall in October,” SQM Research managing director Louis Christopher said.
“However, this will mainly be a seasonal change and so, we are not anticipating a reacceleration of rents for now, which have eased in recent month.
“However, the national rental market remains in severe shortage and barring some exceptions, is not expected to materially soften out of the rental crisis for some years.
“Ongoing strong migration growth, initially forecasted by SQM to materially slow in 2024
towards Federal Budget targets, has not materially slowed.
“Total population expansion for this current calendar year is now expected to be higher than 500,000 people; and so, this rapid population growth will continue to keep pressure on the rental market.”
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The latest ABS population data shows that Western Australia recorded the biggest percentage increase in the 12 months to the end of March, up 3.1 per cent, followed by Victoria (+2.7%) and Queensland (+2.5%).
“Net overseas migration was the major contributor to change in most states, New South Wales, Victoria, Queensland, South Australia, Western Australia, Tasmania and the Australian Capital Territory,” according to the ABS.
“Natural increase was the major contributor to change in the Northern Territory.”
Originally published as Aussie rental pool shrinks as population continues to boom
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