Sydney’s rental market saw a tightening of 0.3 per cent over the last month, and this trend is expected to continue, according to the Real Estate Institute of New South Wales (REINSW).
The February 2013 REINSW Vacancy Rate Survey found that the Sydney metropolitan market has contracted to 1.9 per cent, where vacancy rates in Sydney’s inner suburbs remained steady at 2 per cent, while middle and outer suburbs experienced a decline of 0.4 per cent to 2.0 per cent and 1.8 per cent respectively.
REINSW president Christian Payne expects the market to continue to tighten on the back of a lack of supply, and says that the government needs to provide more incentives to stimulate the market.
“This dire situation will not resolve itself. We need action today from the government to address the inadequate, expensive and complex planning system, and an inequitable property tax regime,” Mr Payne said.
“If not remedied, the crisis will continue to have significant negative impacts on the future prospects of NSW both economically and socially.”
SQM Research's managing director Louis Christopher told Smart Property Investment that he has also recorded a tightening Sydney market over the past two months, with vacancy rates at 1.6 per cent for February.
However, with state government's plans to expand supply across Sydney, he suggested that the vacancy may rise in the three years from now.
According to the survey, the Orana region in NSW, which includes the major centres of Dubbo, Cobar and Mudgee, is the most difficult place to find rental accommodation, according to Mr Payne, with a vacancy rate of 1.1 per cent, a figure last seen in September 2012.
While vacancy rates dropped 0.4 to 3.9 per cent in Coffs Harbour, it continues to be the easiest place to find accommodation, Mr Payne said.