Apartment oversupply pushes Sydney's vacancy rate to its highest level
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Feb 26, 2019
Apartment oversupply pushes Sydney's vacancy rate to its highest level
Older properties are bearing the brunt of Sydney's high vacancy rates, as an apartment oversupply pushes the Harbour City firmly to a tenants market.
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Image by Jamie Davies via UnsplashOlder properties are bearing the brunt of Sydney's high vacancy rates, as an apartment oversupply pushes the Harbour City firmly to a tenants market.
Continued oversupply of apartments has pushed Sydney’s rental vacancy rates up for the fifth consecutive month to nearly 4 per cent.
New figures from the Real Estate Institute of New South Wales (REINSW) show that Sydney had a vacancy rate of 3.7 per cent in January - the highest level recorded in years.
The surge in listings is being driven by an oversupply of housing across Sydney's middle ring suburbs, which include areas like Bankstown, Parramatta, and Auburn.
"Feedback from real estate agents has been that the highest vacancy rates are due to new apartment developments, which have led to a market surplus. Landlords are finding it difficult to adjust by reducing rent," REINSW President Leanne Pilkington said.
"It is getting harder for agents to find tenants, with a slower market and a surplus of properties up for lease.”
Principal of Laing & Simmons Double Bay Property Management, Suzie Reid said older properties are the ones bearing the brunt of the high vacancy rates, as they struggle to compete with newer developments.
"The large number of new properties has meant that it is more difficult to lease older properties that are in need of refurbishment. These are the properties that are experiencing the higher vacancies," Ms Reid told WILLIAMS MEDIA.
She says landlords for older properties should reduce their asking prices to remain competitive.
"Older properties competing with those more glamorous finishes are the most likely to experience extended vacancies if the rent is not reduced.
"Listen to your agent with regard to the current rental value of your unit, as properties that are properly priced will still lease. Accept that this may be a time to take a small drop in price in order to maintain cash flow.
"Every market will experience a drop from time to time. Accept that this is part of the cycle and in time, it will increase again.
"Keep your property up-to-date. Additional special touches can make all the difference when a prospective tenant has to choose between similar properties."
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Contact Details:
Suzie Reid
Laing & Simmons Double Bay
