Adelaide’s channel 7 news has tonight reported on a rental crisis only set to worsen in Adelaide. But this one effects landlords, giving tenants the upper hand.
Channel 7 reports landlords has been forced to slash rents as the availability of properties outstrip demand.
The rental vacancy rate has shot up from 1.41 percent in the March quarter to 3.15 percent in the June quarter, with the Northern Suburbs recording a 10 percent vacancy rate.
Jim Kouzaba says the market hasn’t been this bad in his twenty years as a landlord. His three bedroom house has been empty for 6 weeks now and often no one attends the opens. Over his 20 year history, none of his properties have taken any more than a fortnight to rent.
Landlords have been told they must charge realistic rents, otherwise their properties will remain vacant.
I see in my local area an increasing number of ‘For Lease’ signs. I thought as people are staying away from the house buying market that they would be flocking to rentals. So where are all these tenants disappearing to? I’m confused.
It’s not just SA. I’m watching prime areas of Melbourne and there are plenty of well located examples in middle-upper suburbs that have been sitting there for months. In one inner west suburb many of these properties have been hit by the mass exodus of Asian migrants, who would often bunch up (2-3 families) in the rental. Good luck with the negative gearing ‘miracle’.
Must be due to the huge property shortage they keep telling us about…. When you can’t sell it, rent it.
Moving back to Perth in the future, no plans to buy but we are still looking through the properties to buy, every second house seems empty! Will not be to long for a huge surplus there too!
@Robert.
People do what they have to do under their financial conditions, which is move into share accomodation where their rent would be slashed or moving back home with Mum & Dad.
…and this is to say nothing of all those vacant rooms in share houses and flats.
I’m having trouble finding housemates. The current property is in decay with the property manager stating he’ll go in to bat for a rent reduction – we already know that the owner intends to deliberately neglect the place to save every penny – the frustrating thing is that the property’s condition may now be impacting on my ability to attract co-tenants at market rent.
Earlier this year i had a short-term housemate who intended to stay for 3-6 months. She was there 6 weeks and got the first house that she and her friends applied for.
Of course when clearance rates falter houses go back on the rental market and rental supply eases.
Where have all the tennants gone. Answer: Back with mum and dad or back overseas.
The golden goose has flown. Too much greed scared it off Do landlords seriously believe people could afford the ridiculous prices they were asking? We chose not to listen to the propaganda and didn’t buy. Now the interest from our cash in the bank pays our rent.
Yep, I’ve moved back in with my parents. Thought it was better to move before the economy goes up the proverbial creek. So much more money for travel and gadgets. Best of all, free washing and ironing.
Love my mum!
Ha ha, I live in Sydney and all we hear about is the “rental shortage” too…I have noticed loads of houses up for lease in my suburb too…Also a few empty 3 bedroom houses on my street alone…
Houses are priced by the biggest loan people can get approval for, rents on the other hand are priced by the actual cost of living and wages. If people can’t afford to pay your rental price, they ain’t going to get a loan they will just look elsewhere.
This is not entirely new. I live in Adelaide and the last few times I’ve moved, there has been very little competition for the 3-4b/r houses that we looked at. This was while the media was screaming about a rental shortage so I can only imagine what it’s like now 🙂
Seems the grants have sucked all the renters in to buy. Who will pay the investor mortgage? (interest only for capital gains) good one, sounds like a fool proof plan.
Deflation will expose the geared investors who find themselves on struggle street. Thank the banks and government for facilitating this distorted market.
Looks like Mr Market is coming to town -Enjoy
this is not a surprise. As I pointed out earlier, SA is the state with largest oversupply of homes in Australia. It is likely that more than 50k unoccupied excess homes was built in SA over the last 10 years alone. Population increased by 150k while 110k new homes were built although we need on average 1 new home per more than 2 new residents.