More affordable rental properties are needed to ease the rental shortage in Adelaide, according to the Real Estate Institute of South Australia (REISA).

The residential vacancy rate has dropped to just 1.2% in July which is the thirteenth consecutive month below 2%.

REISA President Mark Sanderson said a lack of affordable properties had kept vacancies down.

“In expectation of the latest interest rate rise, some landlords have been selling their properties and others have been increasing their rents to offset the extra costs,” Mr Sanderson said.

“This leaves fewer properties in the low to mid price range, especially for younger tenants and families.”

“Anecdotal evidence from property managers indicates that low to mid range properties continue to rent well but higher priced properties are slow.”

Mr Sanderson said this was the first time in five months that all metropolitan regions had a vacancy rate below 2%.

“The northern and western suburbs are traditionally a little higher due to more properties on the market, but even these areas have tightened recently.”

The REISA vacancy rate survey is broken down into six main areas. The parameters and statistics during July 2006 were:

City – All city and North Adelaide only. – 1.9%

West – Suburbs west of West Terrace and South Road, and up to Port Road. – 1.6%

South – Suburbs south of and bounded by South Terrace, Glen Osmond Road, ANZAC Highway, and South Road. – 1%

East – Suburbs east of the city square, between Payneham and Glen Osmond Roads, excluding the Hills area. –0.7%

North – Suburbs north of North Adelaide, between Port and Payneham Roads, turning into Lower North East Road. – 1.4%

Hills – Suburbs from Crafers to Nairne. – 0.7%

REISA conducts its exclusive residential vacancy rate survey monthly. Around 5000 properties were included in the survey undertaken for July 2006 with statistics kindly provided by REISA member property managers across the metropolitan area.