Vacancy rates down slightly with rental market still tight, says SQM's Louis Christopher

The national residential vacancy rates were down modestly during May on April 2011, with a drop of 0.1% month-on-month, according to SQM Research.

With a total of 43,786 rental vacancies, the national vacancy rate stood at 1.7%, SQM managing director Louis Christopher says.

“When compared to the same month last year however, vacancies increased by 0.3%, indicating that the rental market has loosened slightly since May 2010.

“That being said, a national vacancy rate of 1.7% still signifies a considerably tight market, and with no capital cities recording vacancies above 2.4% it is safe to say that the 'rental crisis' is yet to be alleviated,” he says.

He says until there is more substantial buyer interest in the housing market, vacancies are set to remain tight as fewer prospective buyers leave rented dwellings to purchase homes of their own.

Christopher says vacancy rates over the past 12 months have been moving in a significantly small range, with a stable trend overall.

The capital city to record the lowest vacancy rate was Canberra at 0.6%, a total of 272 vacancies.

Melbourne was the capital city to record the highest vacancy rate, at 2.4%, a total of 8,707 vacancies.

The only capital city to record a month-on-month growth in vacancies was Hobart, increasing from 1.7% to 1.9% – a total of 443 vacancies.

Darwin was the capital city that experienced the largest month-on-month decline, with vacancies falling by 0.4% to 1.4% - a total of 317 vacancies.

Both Melbourne and Darwin recorded the largest year-on-year growth in vacancies, increasing by 0.9% to 2.4% (8,707 vacancies) and 1.4% (317 vacancies) respectively.

Both Brisbane and Perth recorded the largest year-on-year declines in vacancies, falling by 0.3% to 1.8% (4,584 vacancies) and 1.1% (1,770 vacancies) respectively.

Christopher says SQM's calculations of vacancies were based on online rental listings that have been advertised for three weeks or more compared with the total number of established rental properties.

Sydney had 5,633 vacancies, reflecting 1.0%, in May last year. It now sits at 7,038, or 1.3%, slightly better than the 7,707, or 1.4%, in April.