Victoria’s vacancy rate has hit its lowest point since the Real Estate Institute of Victoria (REIV) began collecting vacancy rate data.
The vacancy rate, currently at 1.8 per cent, has been the lowest it has ever been since data was collected from October 2002.
For REIV president Richard Simpson, a healthy vacancy rate can be considered to be 3 per cent, as he sees this as sufficient vacant housing to meet demand.
“Population growth, lifestyle trends and property price growth are all having an impact on rental vacancy rates in Victoria,” Mr Simpson said.
“These record low figures coincide with the Victorian government’s introduction of proposed changes to the Residential Tenancies Act which strip away landlords’ rights to control what happens with their investment property.
“The bill, which is currently before the parliament, is likely to result in increased competition for rental properties, greater screening of tenants and will place more pressure on rents if it is passed in its current form.”
As of 31 July 2018, metropolitan Melbourne’s vacancy rate was at 1.9 and the lowest in a decade. Inner Melbourne’s vacancy rate was at 1.8 per cent, Middle Melbourne was at 2.5 per cent and outer Melbourne was sitting at 1.6 per cent.
Regional Victoria is also making records with an all-time low rate of 1.5 per cent.
With turnouts for inspections described by Mr Simpson as solid, the rental market will improve even further as spring approaches.
“While the availability of rental stock is at a record low, the cost of renting a home has risen in most areas,” Mr Simpson said.
“The median weekly rent for a house in Metropolitan Melbourne was $450 in July 2018, compared with $425 in July 2017. In Regional Victoria, the median increased from $310 to $330 per week.
“With Victoria’s fast-growing population and financial institutions restricting lending to investors, we cannot see the situation improving for renters in the short to medium term.”