Worst NSW suburbs to be a tenant: 20 markets where rental homes are nearly impossible to find

Finding rental homes has become nearly impossible in a large number of NSW suburbs and renters could be getting a raw deal, new research has revealed.

Finding a vacant rental property in parts of NSW has never been harder than it is in 2022, and some suburbs are only offering three or less accommodation choices for tenants.

New research commissioned by Well Home Loans revealed the 20 suburbs where rental homes were the most difficult to come by, with regional areas topping the list.

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Located in north-eastern NSW within the Tweed Shire, the town of Casuarina was deemed the suburb with the worst rental shortage - only one property was available for renting.

Well Home Loans CEO Scott Spencer said it was now cheaper to buy a home than rent one in many of the suburbs on the list.

Finding a vacant rental property in NSW has never been more difficult.

“If you are an investor in a suburb that contains only three vacant properties, tenants have to compete hard for your property, which gives you the chance to push up rents,” Mr Spencer said.

“All the suburbs in this report are in areas with very low vacancy rates, so even if tenants were prepared to move one or two suburbs along, they’d still find it hard to secure accommodation. That gives investors considerable market power.”

Many of the local residents in these areas, especially Tweed Heads South and West, were cash strapped and struggled to get onto the property ladder.

The Tweed Heads region features a lot of hard to find rental properties.

The second-ranked suburb of Swansea, located to the east of Lake Macquarie, only had one available vacant rental property and an average vacancy rate among houses and units of 0.27 per cent.

All 20 of the suburbs featured on the list were based in regional areas of NSW - none were in Sydney.

“Tweed Heads South and Tweed Heads West are located in an area in the bottom decile, which means their area is more disadvantaged than 90 per cent of areas within NSW. That makes it hard for tenants to afford rising rents and to save a deposit,” Mr Spencer said.

“Conversely, Casuarina is located in an area in the top decile, which means their area is less disadvantaged than 90 per cent of areas within NSW. So they would find it easier to cope with the big jump in local rents and to get onto the property ladder.”

All 20 suburbs listed were based in regional NSW.

The report looked closely at the Socio-Economic Indexes for Areas (SEIFA); an Australian Bureau of Statistics product which ranks areas in Australia according to relative socio-economic advantage and disadvantage.

An areas would rank in a low decile if it contained many households with low incomes, no qualifications or low-skill occupations.

Real Estate expert Tom Panos said that for highly competitive rental markets like the ones in Tweed Heads, potential tenants needed to win the “popularity contest”.

A view of a property in Tweed Heads West.

“There’s a lot of factors which tenants can use to improve their chances of getting a vacant rental home; can you bring peace of mind to the landlord? Do you have a stable income? Do you have rental history you can point to as proof you can look after a property?” Mr Panos said.

“If you’re a landlord in these areas right now, it’s happy days. Many people are looking for a seachange or tree change and are able to work-from home. Others are looking to rent first and buy in the area later.”

To rank highly, an area would contain fewer households with low incomes, low-skill occupations and no qualifications.

TOP 20 NSW SUBURBS WITH LEAST RENTALS
#1: Casuarina
#2: Swansea
#3: Mardi
#4: Bogangar
#5: Tweed Heads South
#6: Tweed Heads West
#7: Pottsville
#8: Mittagong
#9: Eden
#10: Bulli
#11: Moama
#12: Surf Beach
#13: Terrigal
#14: Vincentia
#15: Wamberal
#16: Thirroul
#17: East Lismore
#18: Worrigee
#19: Ulladulla
#20: Yamba

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Originally published as Worst NSW suburbs to be a tenant: 20 markets where rental homes are nearly impossible to find