Conditions are tough for renters. There are very few vacant homes and rents are rising. But in some regions finding a rental is significantly easier.
Recent PropTrack data shows that the national rental vacancy rate dipped 0.04 percentage points to 1.43% in July.
In Australia's capital cities, the share of vacant properties has been trending down since late 2020 and there are now half as many available rentals compared to pre-pandemic levels.
In contrast, vacancy rates in regional areas had been increasing since mid 2022, though they have started to decline again in recent months. Regional rental markets are still tighter than pre-pandemic times, but conditions are marginally better than those in capital cities.
Currently, 1.51% of properties are available for rent in regional areas compared to 1.40% of properties in capital cities.
There are a few factors contributing to this difference.
Demand for rentals, particularly those in cities, have been surging for some time. The recent transition away from remote to hybrid or in-person work and study is drawing people back to the capital cities following significant relocation to the regions during the pandemic.
The recent increase in international migration may also be intensifying this demand, as the majority of new migrants tend to rent in capital cities.
This is reflected in the number of potential renters per listing in the capitals which is 1.7 times higher than pre-pandemic times, and 7.2% higher than July 2022. In contrast, the number of potential renters per listing in regional areas has fallen by 10% over the past year.
A similar trend can be seen when we look at vacancy rates across the SA3 regions (areas defined by the Australian Bureau of Statistics that generally have populations between 30,000 and 130,000).
|SA3||Capital city or rest of state||Vacancy rate|
|Gascoyne||Rest of WA||6.90%|
|East Pilbara||Rest of WA||6.31%|
|Bowen Basin - North||Rest of Qld||4.80%|
|South East Coast||Rest of Tas.||4.71%|
|West Pilbara||Rest of WA||4.66%|
|Central Highlands||Rest of Qld||4.04%|
|Outback - North||Rest of Qld||3.73%|
|West Coast||Rest of Tas.||3.38%|
|Outback - South||Rest of Qld||3.20%|
Almost all of the 10 locations with the highest vacancy rates are in regional areas.
Renters in Gascoyne and East Pilbara in WA had the best chance of securing a home, with 6.90% and 6.31% of rental properties available in these regions.
Around 1 in 20 properties were available to rent in regional Queensland's North Bowen Basin, regional Tasmania's South East Coast, and WA's West Pilbara. Vacancy rates in these regional areas are among the highest in the country.
People renting in the Central Highlands also had more choice, with a vacancy rate of 4.04%.
With demand unlikely to ease in the short term, we expect competition for available rentals to remain high for the rest of 2023.
Rent prices will continue to increase as a result, which will put additional pressure on renters.