Vacancy rates in Sydney have declined across the inner and middle suburbs on the back of rising property prices, according to the Real Estate Institute of New South Wales (REINSW).
A survey by the institute found vacancy rates in inner suburbs have declined 0.1 per cent to 1.7 per cent, while rates in the middle suburbs dropped 0.2 per cent to 1.6 per cent.
Hunters Hill, Parramatta and Ryde are among the hardest places to find rental accommodation in the city, the REINSW reported.
REINSW president Christian Payne suggested rentals are in higher demand as more people are priced out of the Sydney property market.
“First home buyers who can’t afford to buy their dream homes are putting substantial pressure on the rental market,” Mr Payne said.
He pointed to the scaling back of first home buyer grants as a major factor keeping people in rental housing.
“We haven’t seen vacancy rates in the middle suburbs this low in 18 months and this is yet another indicator of how the abolition of incentives on existing properties for first home buyers is causing issues across the marketplace,” Mr Payne said.
Only Sydney’s outer suburbs saw a rise in the vacancy rate, up 0.2 per cent for a total of 1.7 per cent.
Further north in New South Wales, results were mixed.
Rates in the Hunter Valley fell slightly to 2.9 per cent while Newcastle experienced a 0.7 per cent bump to 2.4 per cent.
South of Sydney, rates remained steady in Illawarra at two per cent, while rising to 2.3 per cent in Wollongong.
Albury is the most competitive rental market in the state, with a vacancy rate of 1.8 per cent.
On the other end of the spectrum, the central west has a rate of 4.1 per cent, making it the easiest region in the state in which to find housing.