Great news for owners of rental properties in New South Wales' capital city - vacancy rates are getting even tighter in inner Sydney, according to the Real Estate Institute of New South Wales (REINSW).
The February 2014 REINSW Vacancy Rate Survey showed the number of properties for rent in Sydney's inner suburbs fell 0.3 per cent during February, reaching 1.5 per cent.
"The falls have been most dramatic in the inner suburbs, hitting two-year lows," REINSW President Malcolm Gunning said.
"The wider picture for Sydney highlights the need for investors to be encouraged to continue purchasing residential property. There is not enough stock available and this combined with the future threat of interest rate increases will see rises in rental prices."
Vacancy rates fell 0.2 per cent overall across the city, bringing them down to 1.7 per cent. The middle suburbs experienced a vacancy rate decline of 0.3 per cent, reaching 2 per cent. Meanwhile, vacancy rates in the outer suburbs fell 0.1 per cent, reaching 1.6 per cent.
For current owners of Sydney rental properties, this is fantastic news. Less vacancy means more demand, pushing the value of the properties higher. Meanwhile, as pointed out by Mr Gunning, this will likely lead to an increase in rental prices, resulting in more cash flow positive property for owners.
This is especially true for investors in the inner suburbs. Areas like Bondi, Double Bay, Rose Bay and Bellevue Hill are giving rental property owners plenty to smile about in this climate.
As for those who wish to enter the market in this region, it appears that the middle suburbs may be a good bet. With the highest vacancy rate of the suburban regions, middle suburb property may be more affordable for investors.
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