By Leith van Onselen

As shown above, the commodities bust continues to weigh heavily on both Perth and Darwin, with vacancy rates in each jurisdiction rising in December and jumping by 1.3% and 0.8% respectively over the year, and both jurisdictions breaching the 4% threshold.

By contrast, the bubble epicentres of Sydney (2.1% – no change YoY) and Melbourne (2.8% – down 0.4% YoY) remain relatively tight, as do Adelaide (2.1% – up 0.4% YoY), Canberra (2.3% – no change YoY), and Hobart (1.1% – down 0.3% YoY).

SQM Research also released its asking rents data for the week ended 12 January 2015, which again recorded steep falls in rents in Darwin and Perth, which have held down asking rents nationally:

According to SQM Research’s managing director, Louis Christopher:

“While there is seasonality in these readings, it’s clear that the trend for vacancies is still on the rise. This is as a result of a combination of factors including the strong upswing in residential dwelling construction which commenced back in 2013 and will continue on into 2016; as well as the commodities downturn which has hurt the economies of Perth and Darwin.”

The big surprise to me is Melbourne, where asking rents have risen 2.3% year-on-year for houses and by 4.0% for units.

I doubt it will last long, however, with Victorian (read Melbourne) population growth failing to match the unprecedented rise in dwelling construction (particularly apartments) approved or under construction:

Then again, all those foreign investors could be keeping their properties vacant – a point reinforced by the latest Speculative Vacancies report released last month by Prosper Australia, which revealed that parts of Melbourne’s inner-city apartment complexes are becoming ‘ghost towers’, with large numbers of unused or barely used homes. How long this persists, however, is anyone’s guess.

unconventionaleconomist@hotmail.com

Perth, Darwin rental vacancies top 4%