18 January 2024

Report highlights the most difficult postcodes to find vacant rental properties in Australia

| Andrew McLaughlin
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red for lease sign on white picket fence

The report by MCG Quantity Surveyors highlights some of the most challenging areas by postcode in Australia to find vacant rental properties. Photo: Supplied.

A report released this week shows that there are numerous postcodes in every state in Australia with rental vacancy rates of less than 2 per cent, and has called for more investors to enter these markets.

The report – prepared by MCG Quantity Surveyors – took a snapshot of rental listings available in all Australian postcodes in December 2023 and compared it with census data of known private rental properties in those areas.

Apart from the ACT and Northern Territory, the report broke down the top 10 hardest postcodes to rent in each state’s metropolitan and regional areas.

In the ACT, the report says the postcodes with the lowest number of rental houses available are mostly in Tuggeranong – 2903, 2904, 2902 and 2906 took out the top four positions with between 2.2 and 3.8 per cent vacancy rates.

The remaining places were shared between Gungahlin (2911 and 2912), Tuggeranong (2905 and 2900) and Woden Valley (2607 and 2605). The best vacancy rate in the ACT’s top 10 was 4.8 per cent in Woden’s 2605 postcode.

But in regional NSW, the reading was far starker, with none of the top 10 vacancy rates by postcode exceeding 3 per cent and none having more than 200 known private rental properties.

Leading the way was the 2466 postcode in the Clarence Valley with just one of the 155 private rentals showing as vacant.

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The 2583 postcode of Goulburn-Mulwaree had just less than three per cent available, the 2622 postcode covering parts of Queanbeyan, Braidwood, Mongarlowe, Araluen, Nerriga and Bendoura had less than 2.5 per cent vacancy, and the Young-Yass region covering the 2583 postcode also had just less than 3 per cent.

In Greater Sydney, the areas where it is hardest to find a rental property are the Sutherland (2225) and Fairfield (2178) areas.

In Greater Melbourne, the Yarra Ranges (3158 and 3765) area stood out, as did Cardinia (3981), while Geelong (3213) and Creswick/Daylesford (3342) in Regional Victoria showed shortages of properties.

In Greater Brisbane, the shortages are being hardest felt in the Ipswich Hinterland (4310 and 4342) and the Hills District (4037), while in regional QLD, Rockhampton (4714) and Mackay (4753) showed the tightest rental market conditions.

In Adelaide, the Onkaparinga (5164 and 5166) and Charles Sturt (5020) postcodes showed the lowest vacancy rates, while the Eyre Peninsula and South West (5609 and 5690) and Fleurieu (5223) markets were also tight.

In Perth, Rockingham (6175) and Swan (6084) reported minimal listings, while Regional WA showed Manjimup (6239) and Bunbury (6220) were the tightest markets.

In Hobart, the North East (7016 and 7017) and Brighton (7017) were worst off, while the Meander Valley (7270) and North east (7216) are also challenged.

In the Northern Territory, Litchfield (4839 and 4836), Alice Springs (4875) and Katherine (4850) have the lowest vacancy rates.

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Managing director of MCG Quantity Surveyors Mike Mortlock said, “The December data paints a stark picture for the Australian rental market.

“In areas like Greater Sydney and Regional NSW, we’re seeing a significant crunch in available rentals, putting immense pressure on renters.

“Regions like Greater Melbourne and Greater Brisbane, which traditionally have robust rental markets, are showing an alarming decrease in rental listings,” he added. “This scarcity, though a hardship for renters, presents a unique opportunity for investors, especially with the potential shift in interest rates in 2024.

“Our analysis reveals that while renters in areas such as Regional VIC and Regional QLD are facing tough times, investors could play a key role in easing these pressures. By entering these markets, investors can help increase the availability of rental properties, creating a win-win situation for both the rental community and themselves.”

The report says the lack of rental stock presents an opportunity for investors to contribute to the market for financial gains and to improve rental availability in underserved areas. It says the improvement in rental yields and the potential for stable or declining interest rates in 2024 make these markets particularly attractive for investment.

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I’m surprised this story hasn’t been picked up more. ABC radio Canberra jump on anything like this if it happens in the inner north. Less so when it happens elsewhere across the city.

Scott Anthony4:50 pm 16 Jan 24

Barr and the socialist Green Labor government want around $8,000 plus in rates and land tax if you dare to put a home on the rental market, they get their cut and landlords have to pass the costs onto the tenant. I like many, sold my rental and bought interstate where government isn’t so greedy. I used the savings to install solar so the tenants get near free electricity.

Probably no surprise that renters in Tuggeranong were struggling to find houses to rent and that landlords in the district are leaving the market.

When a basic 70s house on the average large Tuggeranong block will be paying the ACT government about $3,000 in land rates and another $4,500 in land tax per annum, it makes it very difficult for landlords to turn their investment into anything but a big annual financial loss.

It’s not likely that Tuggeranong house price growth will be as strong as the parts of Canberra that the ACT government is focusing its attention and funding on. I doubt a property investment advisor would be highlighting Tuggeranong as the place to buy in Australia.

Mr Barr has created some pretty strong disincentives for rental housing and renters in Tuggeranong. Poor public transport, poor public schooling, poor community services and poorly maintained amenities, these factors are not likely to attract new housing developments or urban renewal in Tuggeranong.

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