The 10 best and worst suburbs for vacancy rates

By Bianca Dabu 10 December 2020 | 1 minute read

Vacancy rates in Sydney and Melbourne continue to rise, offering more choices for renters looking to live in major capital cities.

New Domain research found that, nationally, vacancy rates held steady for the sixth consecutive month at 2.1 per cent.

“This stability illustrates that the rental market has adjusted following the COVID-19-induced bounce to 2.6 per cent in April, the highest national vacancy rate since January 2017,” according to Domain’s senior research analyst, Dr Nicola Powell.

Looking across capital cities, November proved to be a mixed month for renters and landlords.

While some capital cities recorded a fall in vacancy rates over November, Sydney, Melbourne, Adelaide and Darwin lifted. Despite this, vacancy rates remain tight across most capital markets.


According to Domain, this is the first time Sydney’s vacancy rate has risen over a month since the April peak. Tenants will find more choice, with an estimated 21,800 vacant rental listings at the end of November – up 3.9 per cent from October.

The rise in estimated vacant rentals have been most pronounced over November in CanterburyCanterbury, NSW Canterbury, VIC, Parramatta, Merrylands-GuildfordGuildford, WA Guildford, NSW, North Sydney-Mosman and Kogarah-Rockdale.

Further, Sydney’s rental listings growth has outpaced Melbourne for the first time since April.

Similarly, the number of vacant rentals soared in Melbourne during stage 4 lockdowns and continued to rise as restrictions began to ease.

“The more substantial lift in vacant Sydney rentals is likely due to the seasonal influence as the rental market edges closer to the typical tenant changeover period. This seasonal effect may not be as pronounced in Melbourne given the recent COVID-19-induced rental hiatus.

“Despite a significant reopening of the Victorian economy over November and the complete elimination of the coronavirus, Melbourne’s vacancy rate climbed to 4.8 per cent, the highest of all the capitals,” Ms Powell said.

Estimated vacant rental listings rose by 3.5 per cent, as just over 27,000 rentals became available by the end of November. The sharpest rise in vacant rental listings came from inner-city Melbourne, including the regions of Stonnington - West, Whitehorse - West, Boroondara, BrunswickBrunswick, WA Brunswick, VIC - Coburg and Port Phillip.

Top 10 highest capital city vacancy rates

The SA3 regions in Australia with the highest vacancy rates continue to be found in Melbourne and inner-city regions, which are built up with predominantly apartments.

“The effects of the pandemic have decimated Melbourne’s inner city market, as the top 5 highest SA3 vacancy rates in Australia are concentrated within the city,” according to Ms Powell.

The inner-city areas of Melbourne, Sydney, Brisbane and Adelaide continue to be rental weak points as high levels of overseas migration and student population, with a significant proportion of the rental demand sourced from overseas, continue to affect demand.

Further, these areas also have a greater exposure to the industries most vulnerable to the job losses associated with the pandemic.

Victoria’s Melbourne City, Stonnington and Whitehorse West are reported as having some of the highest vacancy rates across the country, with Melbourne City seeing rates of 14+ per cent.

Top 10 lowest capital city vacancy rates

The most tightly held SA3 rental market regions in Australia are scattered across the smaller capital cities.

“The pandemic has brought upon an abundance of demand for people seeking greater space and laidback lifestyle, as working from home becomes more accepted in our workplaces.

“This is likely to place rental demand across lifestyle regions close to the water, tree-change regional areas and on the outskirts of the capital cities,” Ms Powell noted.

Hobart and South Australia’s Marion and Tea Tree Gully see the lowest vacancy rates, which was likely driven by demand by Aussies seeking greater space and laidback lifestyle as working from home becomes more accepted in our workplaces, the research noted.

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The 10 best and worst suburbs for vacancy rates
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