The suburbs where rentals are as rare as hen’s teeth – and where renters actually have options

Only a tiny fraction of properties are available for rent in some popular Australian suburbs, with strong competition between tenants making it extremely difficult to find a home.

High demand for a limited number of properties has put further pressure on rental prices in these suburbs, exacerbating the rental crisis as tenants fork out more money to find somewhere to live.

But there are signs conditions may be easing in many parts of the country, with higher vacancies in some regional areas and suburbs on the fringes of the capital.

While sought-after inner cities and coastal suburbs are among Australia’s tightest rental markets, conditions have eased in other areas, according to the latest PropTrack data, giving renters more options in a challenging market.

Lingering effects of the pandemic have caused extreme tightness in many popular rental markets, especially in the inner suburbs of the capital, according to PropTrack senior economist Eleanor Creagh.

“Since 2021, rental market conditions have tightened considerably in inner city suburbs that were hit hardest by the pandemic, spurred by smaller households, cities springing back to life and the surge in net migration and student arrivals,” he said.

“This is particularly the case in Sydney, Melbourne and Brisbane, where most new arrivals to Australia are first land and rental supply is tight.”

The suburbs where it’s almost impossible to find a rental

The suburb with Australia’s tightest rental market is Dee Why on Sydney’s northern beaches, where the vacancy rate is just 0.32%.

By contrast, Sydney’s overall vacancy rate is 1.37% and the national rate is 1.12%, meaning there is a significantly smaller proportion of rental properties available in Dee Why than the rest of the country.

Despite unit rents in Dee Why jumping 9% over 2023, it’s still the most affordable northern beaches suburb for renters, which was a key factor driving demand, according to Greycliffe Property director Stephanie Grey.

“It’s always been an affordable area, and there’s a higher density of units in Dee Why,” she said. “The lower price point is obviously the key for most people, but the rents are going up.”

The supply of rental properties has been limited by local investors selling up, usually to first-home buyers, Ms Gray said.

“People are not seeing the value of holding their investments to pay the high interest costs,” she said.

Maroochydore on Queensland’s Sunshine Coast has a vacancy rate almost as low, at 0.33%. Other coastal and beachside suburbs ranked among those with the lowest vacancies, including Coogee in Sydney (0.66%) and Rockingham in Perth (0.69%).

These figures are well below the 2-3% range that characterizes a balanced rental market, indicating conditions for renters are still very tough in most parts of the country, particularly in Adelaide, Perth and Brisbane, where city-wide vacancy rates are below 1 %.

In Brisbane, Nundah has a vacancy rate of just 0.39%, while Annerley’s vacancy rate is just a touch higher at 0.4%.

Inner city markets are very tight in the Sydney suburbs of Randwick (0.57%), Newtown (0.59%) and Surry Hills (0.63%) as well as Coburg (0.46%), Brunswick West (0.48%) and Elwood (0.53%) in Melbourne.

Surging population growth, a lack of new housing construction and sales by investors have all combined to reduce the supply of available rentals, according to Ms Creagh.

“Population flows, demand from overseas arrivals who typically rent in inner-city areas and preference shifts are evident in rental market pressures, alongside extremely tight supply,” she said.

The suburbs with the most rental properties available

While many inner city markets have tightened further in recent years, conditions for renters have eased in some suburbs in regional areas and on the outskirts of cities.

The suburb with the highest vacancy rate in Australia is Taylor, Canberra’s northernmost suburb, where 14.7% of rental properties are available.

Hundreds of new homes have been built in Taylor in recent years, with the increase in supply giving renters more options.

Another newly developed Canberra suburb, Denman Prospect, has a vacancy rate of 10.1%.

In NSW, the suburbs with the highest vacancy rates are found in the regions including Berridale (9.7%) and Jindabyne (5.5%) in the snowy mountains, Broulee (8.1%) on the south coast, and Googong (5.7%), a recently-built town outside of Canberra.

High vacancies are also found in the Newcastle suburbs of Birmingham Gardens (7.8%), North Lambton (4.8%) and Waratah West (4.6%), and the outer Sydney suburbs of Box Hill (5%) and Gables (4.9%)

After extreme demand for regional rental properties through the pandemic amid strong population growth and the rise of remote working, conditions in some regional areas have eased a little, Ms Creagh said.

“Regional renters have since seen more stable market conditions, and in some regions easing conditions as those population flows have reversed,” he said.

“However, although there is some respite for regional renters, the reality is that the conditions are a lot tougher than four years ago in many regions.”

Most of the Victorian suburbs with the highest vacancies are found on Melbourne’s fringe, including Eynesbury (5.96%), Donnybrook (5.76%) and Thornhill Park (5.69%).

These suburbs have a much higher proportion of homes available than Melbourne as a whole, which has a vacancy rate of just 1.18%

Recently-developed suburbs that were popular with investors could provide renters with more options, and good value for money too, according to Sweeney Caroline Springs senior property manager Louise Ericksen.

“Out in the western suburbs we’ve got a lot of development around us, and there’s a lot of properties to choose from,” he said.

Despite higher vacancy rates, demand was still strong, Ms Sweeney said, with dozens of groups turning up to open homes and renters often submitting applications as soon as properties were listed.

In Queensland, the suburbs with the highest vacancies are found mostly in the regions, including Dysart (12.96%) and Collinsville (11.61%) which are both found in the state’s coal mining regions, as well as Moore Park Beach (4.87%) outside of Bundaberg, Gladstone Central (4.24%), South Gladstone (3.91%) and Port Douglas (4.16%).

The only Brisbane suburb in the top 10 Queensland suburbs with the highest vacancies is Macleay Island in Moreton Bay, which is connected to the mainland by passenger and vehicle ferries.

The South Australian suburbs with the highest vacancies highlight the extent of the state’s rental crisis.

While the outback towns of Roxby Downs (6%), Port Augusta (2.93%) and Valley View (2.2%) in Adelaide’s northwest have the state’s highest vacancy rates, the other suburbs with the highest vacancy rates are all below 2%, indicating extreme tightness even in the suburbs with the most available rentals.

Ms Creagh said conditions would remain challenging for renters, but there were signs that the rental market was beginning to rebalance, including a rise in household sizes and increased inquiries from investors on properties listed for sale on realestate.com.au.

“The shortage of rental properties and rapid growth in rents has started to encourage more investors into the market, with investors making up an increasing share of new mortgage lending through 2023,” he said.