Rental Vacancies Ease In November

Figures released by SQM Research reveal that the level of residential rental vacancies rose during the month of November.

SQM recorded a vacancy rate of 2.2 per cent, coming to a total of 62,885 vacancies nationwide.

This increase breaks an ongoing trend. It is the first rise after four consecutive monthly declines in residential rental vacancies on a national level.

Much of this may be attributed to seasonality, with a large proportion of university students beginning to vacate their rental accommodation as the study year comes to a close.

 
However, when examining the figures year on year, an 0.3 percentage point increase in national vacancies can be observed, signalling that the rental market has substantially eased since November last year.

What is also of interest is that when comparing this month’s monthly increase to the same monthly increase of the corresponding period in 2012 (i.e. from October to November) we can see that the rise is 0.1 percentage point greater in 2013, hinting at a potential sales market recovery.

“…the rental market has substantially eased since November last year.”

A city by city break down reveals that Darwin has experienced the most substantial monthly rise, climbing 0.5 percentage points month-on-month.

This is in many ways what could be perceived as a pleasing result for Darwin, which has been suffering exceedingly tight vacancy rates in the past 12 months.

However, we have gradually seen this capital city’s rental market loosen up of late.
 
Year-on-year, Perth has recorded a substantial increase, rising 1.0 percentage point and has continued to exhibit ongoing increases in vacancies, which SQM Research attributes largely to the decline  in mining activity in the region.
 
Managing Director of SQM Research, Louis Christopher says:

“The national rental market has recorded a rise in vacancies for November which is normal for this time of year. It is likely as well that the December result will also record a rise.

I note though Brisbane now appears to be recording clear upward in vacancies and of particular interest is what is happening with the Brisbane CBD, where on our numbers, vacancy rates are now at 4.7 per cent and rising quickly.

On the other hand Hobart is now recording a clear trend of declining vacancies with the vacancy rate in that city now standing at just 1.4 per cent after continuous declines for the past six months.

In all this, investors should be fully aware of rental market conditions before making decisions in the housing market.”

SQM’s calculations of vacancies are based on online rental listings that have been advertised for three weeks or more compared to the total number of established rental properties.

SQM considers this to be a superior methodology compared to using a potentially incomplete sample of agency surveys or merely relying on raw online listings advertised.