NSW: Rental market figures split researchers on 'crisis'
23 Jan 2009 12:01 AM
Eds: Embargoed until 0001 AEDT Friday, January 23
SYDNEY, Jan 23 AAP - Sydney's rental market remains very tight with little change in the vacancy rate over recent months, new figures show.
The Real Estate Institute of NSW said the percentage of available properties in Sydney remained largely unchanged for the last four months of 2008, but there were significant increases recorded in both Newcastle and Wollongong.
"For December the available rental vacancy rate rose just 0.1 per cent to 1.4 per cent, which means the market remains very tight in Sydney," institute president Steve Martin said in a statement.
Middle and outer suburbs, located between 10km and 25km, and more than 25km respectively from the city centre, showed a greater increase in availability.
"We are clearly not seeing any return to the Sydney property market by investors despite the historic low interest rates now on offer," Mr Martin said.
"The fact is that market conditions are almost perfect for investors thinking about residential and commercial property.
"It is only a matter of time before we start to see investors coming back into the property sector in strong numbers, similar to the influx of first home buyers witnessed in recent months."
However, independent property advisory and forecasting group SQM Research said Sydney vacancy rates improved during 2008 and that based on their calculations, there was no evidence of a rental crisis.
SQM found that there were 19,732 rental properties sitting vacant in Sydney in December, compared to 10,492 vacancies at the same time in 2007.
"With over 19,000 properties vacant at the end of December, I fail to see how there is a rental crisis in Sydney," SQM spokesman Louis Christopher said in a statement.
"The reality is that the number of available rental properties have been steadily rising since July 2007 and so what rental crisis there was in Sydney is certainly coming to an end.
"That said, the stories of 50 or more people turning up to an advertised rental property are no doubt true.
"I think there are still issues at the lower to bottom end of the rental market place," he said.
NSW Opposition Leader Barry O'Farrell said there was a rental crisis and it was caused by high taxes and charges.
"Land tax - which was raised in the November mini-budget - development levies and other taxes and charges are a major disincentive for people to invest in new housing," Mr O'Farrell said.
"Labor's high tax regime has brought the housing sector to its knees, the availability of rental properties has dwindled and renters are paying the penalty."
Tenants are also paying more rent, with Australian Property Monitors data showing Sydney residential rents rose by almost $65 a week or 16.9 per cent in the past 12 months, Mr O'Farrell said.
