The REIV June 2006 Rental vacancy rates show that Melbourne rental vacancies remain at their lowest since March 1998.

REIV CEO Enzo Raimondo said that for the second month the Melbourne wide vacancy rate was a low 1.7 per cent and Regional
Victoria also remained steady with a vacancy rate of 2.4 per cent.

Mr Raimondo said “With a second rate rise this year I would expect the market to get even tighter as buyers of more affordable properties may defer property purchases and remain in rental accommodation.

While the overall vacancy rates remain steady there have been regional variations.

“Within 4 km of the CBD there also appears be a reduction in supply which may also cause a further tightening in the market. In March this year the vacancy rate within 4km was a low 2.3 per cent, now it’s only 1 per cent.

“Our measure of untenanted properties and vacant new properties provides further confirmation of the lack of supply. In March this year 3.1 per cent of properties were untenanted or newly created vacant properties. Now this rate is a low 1.7 per cent.

“This shows that there is very little new supply coming onto the market in places like Docklands, Richmond or Carlton.

“Rental vacancies in the inner city are in high demand, this is good for owners and investors and will make it harder for people looking for rental accommodation.

“There has been a small increase in the vacancy rate in the suburbs between 4 and 10 km from the CBD – suburbs such as Brunswick, Northcote, Newport, Essendon, Elwood and Elsternwick.

“Outside Melbourne there is a better availability of rental accommodation except in the Geelong region where the vacancy rate dropped from 2.4 per cent to 1.4 per cent in one month. It’s almost as hard to find rental accommodation in Geelong as it is in the inner city of Melbourne.

“While the low rate is not good news for renters I expect investors should receive better returns,” Mr Raimondo concluded.

Vacancy rate June 2006
MELBOURNE
Inner (0-4km)- 1%
Inner (4-10km)- 2%
Middle - 1.9%
Outer - 1.8%