According to Domain’s latest rent report, the nation’s vacancy rate returned to a record low of 0.8 per cent, showing that finding an available home for rent is once again growing more difficult.
Most capitals have seen vacancy rates slide backwards once again after some positive gains through mid-2023.
Sydney and Perth have now hit a record lows, at 0.9 per cent and 0.3 per cent respectively. Melbourne, Brisbane, Adelaide and Darwin are close to record lows, all under 1 per cent.
Illustrating the long-term nature of the issue, Adelaide and Perth have now recorded a vacancy rate below 1 per cent for roughly three years, while Brisbane has held below 1 per cent for almost two years.
The firm estimated that for vacancy rates to return to healthy levels of between 2 per cent to 3 per cent, the nation needs to see an infusion of up to 70,000 new dwellings on the market – an amount that equates to roughly the number of homes found in Newcastle’s local government area.
According to Dr Nicola Powell, Domain’s chief of research and economics, dampened conditions for construction coupled with disincentives for investors have been two large contributors to the current rental shortage.
“Rental supply has suffered due to the sustained development undersupply and investors selling under holding pressure costs,” Dr Powell said.
Noting that this situation has been years in the making, she lamented that solutions would hardly appear overnight.
“There is no quick fix to ease the competitive rental market, as many factors are at play. One of the key factors is investors. They are currently reluctant to hold debt with rising costs, as evidenced by the falling annual investor share of new lending,” she said.
But though the market is lacking the stock levels it needs, renters may