Sydney’s vacancy rate soars as tenants continue exodus from inner city

Continuing the trend of recent months, the REINSW Vacancy Rate Survey results for June 2020 show that COVID-19 continues to impact the residential rental market.

Vacancies in Sydney increased for the fourth consecutive month and now sit at 4.5%, up 0.4% from May and 1.5% since March.

“Sydney’s Inner Ring experienced the most significant change, rising 0.8% to 5.8%,” REINSW CEO Tim McKibbin said. “Last month, vacancies in the Inner Ring hit an 18-year high at 5.1% – a result that has been exceeded this month. Looking back at more than 20 years of survey results, we’ve not seen vacancy rates this high. It really is staggering.

“The Middle Ring also increased, with a 0.6% rise to 4.6%. Sydney’s Outer Ring was alone in recording a decrease in rental vacancies, falling 0.1% to 2.6%.

“The impact of COVID-19 on the residential rental market continues to be significant and shows no sign of abating. As unemployment continues to rise and with the end date for JobKeeper and JobSeeker benefits looming, affordability is at the forefront of many tenants’ minds. It’s really no surprise that inner-city properties with higher weekly rents are being relinquished in favour of more affordable options.

“For inner Sydney, if this trend continues, as it’s likely to for the foreseeable future, we can expect to see downward pressure on rents. While this is great news for tenants, it’s a recipe for disaster for many landlords,” he said.

Regional areas are faring better. Vacancies in the Hunter region dropped by 0.6% to sit at 1.8%, and the Illawarra region saw a 0.5% decrease to 3.1%. Other regional areas also recorded significant drops including Albury (-0.6%), Central West (-0.5%), Coffs Harbour (-0.6%), Mid-North Coast (-1.2%), Murrumbidgee (-1.2%), New England (-0.8%), Orana (-0.6%), Riverina (-1.3%) and the South East (-1.0%).

“This month’s results really do tell two very different stories, with inner Sydney continuing to suffer while regional New South Wales and outer Sydney appear unaffected by COVID-19 to date,” Mr McKibbin said.

Residential vacancy rate percentage

The REINSW Residential Vacancy Rate Report is based on the proportion of unlet residential dwellings to the total rent roll of REINSW member agents on the 15th of each month. Carried out monthly, the research – a survey of REINSW member agents conducted by Survey Matters – collects the total properties on agency rent rolls, the number of properties that were vacant on the 15th of the month, and the postcode in which a majority of agents’ rental properties are located. The suburb-level rates reported by agents are weighted based on ABS Census 2016 Dwelling Characteristics. The June 2020 report is based on survey responses covering 116,110 residential rental properties.

Jun – 20

May – 20

Apr- 20

Mar – 20

Feb – 20

Jan – 20

Dec – 19

Nov – 19

Oct – 19

Sep -19

Aug -19

Jul -19

SYDNEY

Inner

5.8%

5.0%

4.3%

2.5%

2.8%

3.1%

3.4%

2.4%

2.7%

3.1%

3.4%

3.0%

Middle

5.2%

4.6%

4.4%

3.6%

3.9%

3.6%

3.4%

3.7%

4.2%

3.0%

3.9%

4.1%

Outer

2.6%

2.7%

3.1%

3.0%

3.5%

3.3%

3.4%

3.6%

3.9%

2.7%

3.5%

3.4%

Total

4.5%

4.1%

3.8%

3.0%

3.4%

3.3%

3.4%

3.2%

3.6%

2.9%

3.6%

3.5%

HUNTER

Newcastle

1.7%

2.4%

2.1%

1.6%

2.5%

2.0%

2.5%

2.6%

2.5%

1.2%

1.5%

1.6%

Other

1.9%

2.4%

1.8%

1.2%

2.0%

0.9%

1.7%

1.1%

1.4%

1.0%

1.4%

1.8%

Total

1.8%

2.4%

1.9%

1.3%

2.1%

1.2%

1.9%

1.6%

1.8%

1.0%

1.4%

1.7%

ILLAWARRA

Wollongong

3.2%

3.9%

3.2%

3.5%

2.0%

2.9%

2.6%

4.3%

2.5%

2.8%

2.4%

1.6%

Other

2.9%

2.9%

4.3%

4.3%

2.3%

2.3%

2.9%

1.5%

2.1%

1.5%

2.3%

3.3%

Total

3.1%

3.6%

3.6%

3.8%

2.1%

2.7%

2.7%

2.9%

2.4%

2.2%

2.3%

2.2%

REGIONS

Albury

0.6%

1.2%

1.2%

0.6%

1.6%

1.8%

1.1%

1.3%

0.9%

1.0%

1.3%

1.8%

Central Coast

2.1%

2.3%

3.0%

2.4%

3.0%

4.3%

5.1%

3.5%

4.4%

3.0%

3.4%

3.0%

Central West

1.5%

2.0%

2.0%

1.0%

1.4%

2.1%

2.2%

2.0%

1.9%

2.3%

2.3%

2.1%

Coffs Harbour

2.4%

3.0%

3.4%

3.1%

5.4%

3.3%

2.5%

3.1%

3.6%

2.9%

1.3%

3.2%

Mid-North Coast

2.0%

3.2%

2.6%

1.7%

2.5%

2.4%

2.2%

2.3%

2.1%

2.8%

2.6%

2.1%

Murrumbidgee

0.8%

2.0%

1.1%

1.4%

1.5%

1.9%

1.8%

0.5%

1.2%

1.0%

1.1%

New England

3.1%

3.9%

3.4%

3.0%

3.8%

4.1%

3.3%

2.4%

2.8%

2.4%

2.6%

2.6%

Northern Rivers

2.6%

1.8%

2.7%

1.7%

1.7%

2.2%

1.5%

1.3%

1.5%

1.6%

2.1%

1.9%

Orana

1.9%

2.4%

2.7%

0.7%

1.2%

2.4%

1.8%

1.8%

1.8%

1.4%

1.5%

2.5%

Riverina

1.2%

2.5%

1.8%

1.5%

1.9%

1.7%

1.2%

0.8%

1.1%

1.2%

1.8%

1.3%

South Coast

2.7%

2.0%

1.7%

4.8%

3.9%

2.7%

3.4%

2.4%

3.1%

3.1%

2.8%

2.8%

South Eastern*

0.8%

1.8%

0.7%

3.5%

2.5%

1.8%

1.2%

0.3%

0.8%

1.2%

4.1%

3.4%

/Public Release. The material in this public release comes from the originating organization and may be of a point-in-time nature, edited for clarity, style and length. View in full here.