Sydney Vacancy Rate: A Notable Discrepancy
Phil McCarroll writes an article for the website Your Investment Property where he talks about a disagreement in the rental vacancy rate for Sydney which has spawned a debate regarding just how many homes are free for tenancy.
Discrepancy in Sydney vacancy rate reports
SQM Research offers a report citing a slight increase in the vacancy rate in November, expressed as 0.1%. According to them, the total number of vacancies has come up to 10,045 from 9,692. ‘SQM’ believes that this increase is in sync with the seasonal trends.
SQM and REINSW at loggerheads
On the other hand, the Real Estate Institute of New South Wales (REINSW) believes that the vacancy rate has squeezed in November and fell from 1.9% to 1.7%. While vacancies in Inner Sydney have fallen in November, they could not reach their trough because of the completion of many apartment projects.
You can read the original article here.
What is so interesting about the disagreement?
Both SQM and REINSW believe that the vacancy rates stand at 1.7% for the month of November but it is interesting that while the SQM takes initial vacancy rate as 1.6% (climbing up to 1.7% over November), REINSW takes the initial rate as 1.9%. It could still have been understandable had the discrepancy been 0.05 percentage points, but a gap of 0.3% in the reading of two highly reliable “stat houses” is hard to fathom.
Moreover, while some believe there has been shrinkage in vacancy rates, others feel that there has been an easing out over November.
The Inner Sydney Paradox
Talking of Inner Sydney, they surely have offered a paradox. Even when the vacancy rate has taken a beating here, it has sailed above the vacancy rates of its counterpart suburbs. The recent population explosion and inter-state migration can at least partially be blamed for the tightening vacancy rates (they surely have squeezed irrespective of the November readings). The trend is likely to continue.