Rental crisis: vacancy holds as green shoots appear

Demand has eased off in the rental market, allowing a ever-slight easing in vacancy rates, according to housing researcher PropTrack.

Signs of an easing in the rental market are unlikely to have been felt by tenants battling for a home after vacancy rates held steady over the past quarter.

National rental vacancy rates loosened 0.02 percentage points throughout the past quarter but still remain 45 per cent lower than pre-Covid norms, according to new figures from housing researcher PropTrack.

About 1.45 per cent of rental stock is available around the country – well below the 3 per cent level considered healthy – with conditions tightest in Adelaide and Perth.

PropTrack senior economist Paul Ryan said the loosening of rental conditions in capital cities was “promising” despite higher than expected levels of migration.

“Slowing rental demand has resulted in more rental properties being available for lease,” Mr Ryan said. “Despite the ­improve­ments, rental vacancy rates remain low, around half the levels seen before the pandemic and demand is easing, but still strong.

“Capital cities are seeing more promising rental market conditions, with vacancy rates up 0.17 percentage points over the past three months. This is the most significant easing in rental market conditions since early in the pandemic in November 2020.”

Just 1 per cent or less of stock is available in Adelaide and Perth, despite a small relaxation in ­vacancy rates last quarter of 0.06 percentage points and 0.12 percentage points respectively.

Rental availability is half what it was three years ago in Sydney and Melbourne.

The only capitals to experience a further tightening through the June quarter were Brisbane (down 0.01 percentage points to 1.12 per cent) and ­Darwin (down 0.21 percentage points to 1.63 per cent), with an acceleration of falls in the Sunshine State capital last month.

The opposite is playing out in Hobart and in the ACT, where tenants in both markets have more choice than before the ­pandemic.

In the nation’s capital, vacancies are near double what they were in March 2020 and currently sit at the highest level in the country (2.1 per cent); the Tasmanian capital has about 54 per cent more property on offer with a ­vacancy rate of 1.87 per cent

Regional rents eased 0.07 percentage points in the June quarter to 1.54 per cent.

Mr Ryan said the rate of rental increases had probably peaked but “it remains difficult to find a rental across the country and we expect rents to continue to grow quickly, placing additional financial pressure on renters”.

“However, the rental market eased ­further in June, providing some much-needed relief for renters,” he said.