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NSW vacancy rates ease but crisis far from over

Renters across NSW have received a slight reprieve, with December vacancy rates rising, but the rental crisis is far from over, according to the industry.

The REINSW Vacancy Rate Survey results for December 2023 showed vacancy rates eased across metropolitan areas and some regions.

The vacancy rate for inner Sydney rose from 1.2 per cent to 1.8 per cent, while middle Sydney increased from 1 per cent to 1.5 per cent.

However, outer Sydney saw conditions tighten, with the vacancy rate falling from 1.4 per cent to 1.2 per cent. 

REINSW Chief Executive Officer Tim McKibbin said the uptick was a result of the changeover period around Christmas and New Year, and it didn’t mean the rental crisis was over.

“What we’re seeing is a seasonal fluctuation, as students vacate for the festive period and families make decisions about where they want to live in the New Year,” Mr McKibbin said.

“It happens every year and this month’s survey results reflect this fact.”

Mr McKibbin said while the increase does represent a jump in vacancies, the state is still experiencing historical lows when it comes to rental property availability.

Source: The REINSW Vacancy Rate Survey results for December 2023

The increase in vacancy rates was not as prominent elsewhere across the state, with the Illawarra region dropping 1.1 per cent, to a vacancy rate of 1.3 per cent.

However, vacancies did rise in the Hunter region, up 0.4 per cent to 1.9 per cent.

In contrast to Sydney, many regional areas experienced a tightening of residential vacancies.

“Rates for the Central Coast, Central West, Murrumbidgee, Orana and Riverina areas all dropped in December 2023,” Mr McKibbin said.

“The Albury and Coffs Harbour areas remained stable, while the Mid-North Coast, New England, Northern Rivers, South Coast and South East areas rose.”

Mr McKibbin said supply levels could still not keep up with demand.

“Demand for rental accommodation certainly isn’t slowing, but the number of properties in the supply pipeline is,” he said.

“The inevitable knock-on impact is fewer properties available in the rental pool.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.