Sydney’s vacancy rates are at a five-year high, according to the latest REINSW data, with reports that the city is also facing the smallest house price growth in the country.
The Real Estate Institute of New South Wales (REINSW) has announced that vacancy rates in middle Sydney are at the highest they have been since 2012, rising to 2.9 per cent, up by 0.3 per cent.
“This is the highest level since August 2012 when the vacancy rate for middle Sydney was at 3.0 per cent,” REINSW president Leanne Pilkington said.
“The area has seen a significant increase in available stock and a decline in applications.”
Overall, metropolitan Sydney rose by 0.1 per cent to 2.2 per cent. Inner Sydney also rose to 2.1 per cent, up by 0.1 per cent, but outer Sydney fell to 2.2 per cent, down by 0.1 per cent.
Meanwhile, Sydney was also revealed to be the capital city facing the smallest house price growth, according to the Property Investment Professionals of Australia (PIPA).
Analysing the last 15 years of data provided by the Australian Bureau of Statistics’ Established House Price Index showed that Sydney’s house price index rose by 142 per cent.
In comparison, the capital city with the highest house price index was Hobart at 220 per cent, followed by Melbourne at 208 per cent, Darwin at 161 per cent, Brisbane at 160 per cent, Perth at 159 per cent, Adelaide at 147 per cent and Canberra at 146 per cent.
PIPA chairman Peter Koulizos said that these results show that investors need to look at long-term results if they wish to succeed, not short-term wins.
“Educated investors understand the importance of time in the market, not trying to time the market, which is really just speculation by another name,” Mr Koulizos said.
“An issue that PIPA had during Sydney’s recent growth run was we knew its market had done very little for the best part of 10 years beforehand.
“So, it was the sign of a normal market cycle, not a bubble, that threatened real estate prices across the country.”
Looking at interstate migration figures, Mr Koulizos said that cheaper property was becoming more important to investors than property in premium locations like Sydney.
“The latest interstate migration figures highlight this, with many Sydneysiders opting to relocate to more affordable locations,” the PIPA chairman said.
“Likewise, Hobart’s position at number one in the results is further evidence that affordable property is on the radar of investors who generally opt for lower priced real estate.
“Similarly, PIPA has always said that the strong price growth in Sydney was driven by emotional owner-occupiers and not the vast majority of investors who can only afford to buy one or two properties in their lifetimes.”