Rental Crises in Sydney

The rental crises has reached new lows in Sydney with 30-40 applicants turning up for open house inspections, causing traffic congestion and even "rental rage".

With rental rates of 1-2% for the last few years are set to get worse rather than better in the short-term. REI president Steve Martin is quoted as saying:

"It is the worst we have ever seen ... The situation is now so grave we are unfortunately experiencing incidents of rental rage."

In the whole of Sydney there are only around 700 rental properties available - in a city of around 4 million people - this is not good. The imagination fails as to how bad the situation will be in February the traditionally tight time of the year to find a flat or house to rent.

NSW's Premier Nathan Rees has agreed to meet with the Real Estate Institute for crisis talks as figures reveal vacancy rates have remained below 2 per cent for more than two years.

Would be tenants are in tears at rental open homes because they can't compete with the numbers present. You are in a lot of trouble if you happen to have undesirable characteristics such as children, pets or be a smoker. To be blunt being non-white wouldn't help is some areas either.

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The Police have been called when frustration has turned to anger against real estate agents, with three agents reporting being attacked or abused.

The areas with the lowest vacancies are between 10 and 25km from the city centre suggesting that people are looking for cheaper family homes which aren't going to cost them a fortune in petrol or train fares to commute to work and school.

There seems to be both a supply and demand issues resulting in the crises.

Sydney's population is growing at around 1400/week, outstripping the number of rental properties by 2 to 1. Its possible too that mortgage defaults or just high costs are seeing families reverting from home owners to renters again.

NSW also has one the most punitive tax regimes of any Australian state with high stamp duty and land tax, seeing investors move their interest to other states. The government has also been slow in freeing up land , though Sydney's geography - caught between the coast and the Blue Mountains means there is very little further the city can really sprawl.

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