Despite Sydney and New South Wales’ rental markets being in a state of a limbo amid the threat of the Omicron variant, vacancies continued to shrink in most areas.

Figures from the Real Estate Institute of New South Wales (REINSW) showed that residential rental vacancies declined to 2.8% in Sydney, driven by fewer listings in the inner ring.

Over the month, vacant rental properties in Sydney’s Inner Ring went down from 4.4% to 3.7%.

Meanwhile, vacancy rates in the middle and outer rings remained stable at 2.9% and 1.8%, respectively.

Outside Sydney, there was a slight uptick in vacancies in Hunter and Wollongong, which recorded respective rates of 2.1% and 0.8%.

Across New South Wales regions, there were also a couple of up and down movements in vacancy rates.

The regions of Central Coast, New England, Northern Rivers, Orana and South Coast areas all recorded higher share of available rental properties in the month.

















Region

Vacancy Rate (%)

Dec-21

Nov-21

Albury

0.5

0.9

Central Coast

1.1

1.0

Central West

0.5

0.5

Coffs Harbour

0.8

1.1

Mid-North Coast

0.7

0.8

Murrumbidgee

0.6

0.8

New England

1.1

0.5

Northern Rivers

1.1

0.7

Orana

1.5

1.3

Riverina

0.6

0.6

South Coast

0.4

0.3

South Eastern

0.8

1.0

REINSW CEO Tim McKibbin said the results over the past month was affected by the threat of the Omicron COVID variant.

“We certainly expected to see a lull in the market leading into the festive season, however REINSW members are reporting that this usual lull was exacerbated in December because people are hesitant about the future as Omicron continues to spread,” he said.

“As a result, many are delaying their plans to move, leaving the market in limbo.”

Steepest annual rent increase since 2009

According to Domain’s latest rental report, Sydney recorded a new record for weekly house rents at $600 over the December quarter, representing a 3.4% or $20 jump.

On an annual basis, rents grew by 9.1% or $50, the steepest growth since 2009.

Meanwhile, unit rents increased by 1% or $5 in the quarter. Interestingly, the unit segment posted its first annual gain in rents in almost four years, up 4.3% or $20.

However, unit rents remain $60 lower than the record high achieved in mid-2018.

The Domain report said the race for space among tenants working from home amid lockdowns has pushed the demand to houses.

“This has been evident as high demand for houses meant rents rose more than double the rate of units over the past year,” the report said.

The growth in investment activity, according to the report, would be able to boost supply in the coming months.

Photo by @alnbal on Unsplash.


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