Rental vacancy rates in our nation’s biggest capital cities have spiked sharply, recording the biggest monthly jump in over ten years.
SQM research reveals more than 88,000 homes were left vacant last month in Australia, no doubt driven by the coronavirus crisis.
Managing director at SQM, Louis Christopher, told Domain it’s a full-on tenants’ market right now.
“Rents have been falling and they’re likely to continue to fall for the foreseeable future,” he said.
“It is happy days for tenants and a bit of a disastrous scenario for landlords.”
“The blowout in rental vacancy rates for the major CBDs suggests a mass exodus of tenants occurred over the course of March and April.”
The huge hit to employment and international students in our CBDs resulting from the COVID-19 lockdown are two of the main drivers of this exodus.
Holiday areas have also been hard hit but are expected to bounce back quickly once state borders reopen.
As for the national vacancy rate, Mr Christopher said he expects that to stay high until the international borders were reopened.
“We’re completing 170,000 dwellings this year, whereas real demand is going to be for somewhere along the lines of 90,000 to 100,000 properties,” he told Domain.
Real Estate Institute of Victoria president Leah Calnan said inner Melbourne tenants were increasingly giving notice but thinks the market is beginning to settle.
“I wouldn’t expect the city’s vacancy rate to keep climbing,” she told Domain.
Ms Calnan did, however, say that rental hotspots like the CBD, South Yarra and Southbank would all continue to face challenges going forward.