Australia’s housing market continues to feel the heat from rising demand and lack of supply in both rental and sales segments.
Domain’s latest report showed that the national vacancy rate has already dropped to 1.1%, the lowest since its records began in 2017.
The report noted that the market continues to remain in favour of landlords, as vacancy rates dipped significantly below the pandemic-induced spike over the last two years.
All capital cities reported monthly declines in vacancy rates, save for Adelaide and Hobart that maintained their vacancy levels from the start of 2022.
On an annual basis, every capital city posted a drop in vacancy levels.
Hobart was the tightest rental market with a vacancy rate of 0.2%, followed by Adelaide at 0.3%, Perth (0.5%), and Canberra (0.5%).
“Australia is on the verge of a rental crisis, as rental demand will continue to sharply rebound following the full reopening of international borders to double-vaccinated visa holders and tourists, following two years of closures,” the report said.
The resurgence in rental demand affected Sydney and Melbourne the most, with their vacancy rates falling from 2.6% and 4.4% in 2021 to 1.7% and 2.1% in 2022.
Meanwhile, the sales market is also under substantial pressure, as overall listings remain 16.8% below last year, despite a 6.8% gain in February.
The number of available residential properties went up from 200,865 to 214,495 in February, with Sydney and Canberra racking up the highest monthly gains, according to SQM Research.
On an annual basis, however, listings remained significantly down in Brisbane, Adelaide, Canberra, and Hobart.
SQM Research managing director Louis Christopher said the monthly gain in listings across all capital cities reflect the urgency of sellers to take profits after the unexpected price rises in 2021.
“We could see the upward trend in listings continue through the first half of the year as more sellers seek to take profits,” he said.
“However, the national housing market appears to remain reasonably buoyant — overall, supply remains below long-term averages and we are still recording capital city rises in asking prices.”
Photo by @journosousa on Unsplash
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