Sydney price gains moderating and vacancy rates climbing

Sydney price gains moderating and vacancy rates climbing
Sydney price gains moderating and vacancy rates climbing

Sydney’s residential vacancy rates are on the rise, with July recording a 0.2% increase to 2.0%, according to the Real Estate Institute of New South Wales (REINSW) Vacancy Rate Survey.

REINSW president Malcolm Gunning notes that more apartment stock entered the marketplace, which may be behind some of this increase.

“Inner Sydney vacancy rates led the way with an increase of 0.1% to 2.0%, while the outer suburbs increased 0.4% to 1.9%. The middle suburbs bucked the trend with a fall of 0.2%, but remain at the neutral level of 1.9%,” said Gunning.

“We expect this growth in rental accommodation to continue as even more new stock enters the marketplace.”

This has come at a time when ANZ Research’s David Cannington is seeing Sydney growth moderating, as Melbourne takes out top spot when looking at growth on a trend basis. Price growth year on year is sitting at 15.1% for Sydney, and 11.3% for Melbourne.

“Housing market sales continued to reflect positive housing market sentiment in the past week, particularly in Sydney where elevated auction levels for this time of year have cleared at greater than 75% for the fifth consecutive week,” noted Cannington.

He notes that elevated auction clearance rates, for both Sydney and Melbourne, are foreshadowing strong sales demand and further house price gains in the remaining 2014 months.

Outside of the Sydney area, vacancy rates have been recorded as a mixed picture. In the Hunter, a 0.5% increase was recorded, despite a 0.3% decline in Newcastle. Illawarra increased by 0.3%, while Wollongong remained steady at 2.1%.

New England, however, has hit an 11 year high, up to 4.2% with a 0.2% increase recorded. In October 2003, the last time it was this high, it recorded 4.8% vacancy. The South Coast is up 1.4%, with Central West has dropped 0.5%.

Murrumbidgee’s vacancy rate was up 0.5%, while Albury increased by 0.7%.

Jennifer Duke

Jennifer Duke

Jennifer Duke was a property writer at Property Observer


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