RECORD HIGH MORTGAGE DEFAULTS WILL ADD TO NSW RENTAL CRISIS
Released 14 August 2008
There appears to be almost no relief in the NSW rental market and the future is set to become worse with record numbers of people in NSW defaulting on their mortgages.
The latest July statistics released by the Real Estate Institute of New South Wales show rental vacancies improved by just 0.1% in Sydney, however the outlook remains grim.
Credit reporting agency Moody's has found that 12 of the 20 highest mortgage default areas in Australia are in NSW and that the number of mortgage defaults in the first quarter of 2008 were at record highs.
"The NSW rental market is already under immense pressure however the added impact of people defaulting on mortgages and moving from home owner to renter will only inflame an already critical situation," said REINSW President Steve Martin.
While the situation in the outer and middle suburbs of Sydney improved slightly, inner Sydney recorded the worst result with a 0.2% drop in rental vacancies to 1.2%.
Middle Sydney rental vacancy levels rose 0.2% to 1.3%, while outer Sydney recorded a 0.1% increase to 1.0%.
Rental vacancies in Newcastle have fallen for a second month in a row down another 0.3% to 1.5% - this figure now being less than half of the available vacancies in May.
The Central Coast showed an improvement, with an increase of 1.4% to 3.2%. Wollongong also had a slight increase, up 1% to 2.3%.
"The NSW government's staunch refusal to acknowledge this growing crisis is going to lead to thousands of people suffering housing stress. Unless matters such as land tax and stamp duty are addressed immediately the consequences could be dire.
"The downward trend of these figures is set to continue if the state government insists on sticking its head in the sand on the issue of rental vacancies," said Mr Martin.
Residential vacancy rates in NSW:
| July 2008 | June 2008 | May 2008 | April 2008 | |
| SYDNEY | 1.2% | 1.1% | 0.9% | 1.0% |
| Inner (0-10km from CBD) | 1.2 | 1.4 | 0.9 | 1.2 |
| Middle (10-25km) | 1.3 | 1.1 | 0.8 | 0.9 |
| Outer (>25km) | 1.0 | 0.9 | 0.8 | 1.0 |
| HUNTER | 1.5 | 1.8 | 2.2 | 1.9 |
| Newcastle | 1.5 | 1.8 | 3.1 | 1.5 |
| Other | 1.6 | 1.8 | 1.9 | 2.2 |
| ILLAWARRA | 2.2 | 2.2 | 1.6 | 1.6 |
| Wollongong | 2.3 | 1.3 | 2.0 | 1.5 |
| Other | 2.3 | 3.4 | 1.6 | 1.9 |
| Central Coast | 3.2 | 1.8 | 2.7 | 2.7 |
| Albury | 3.7 | 4.1 | 3.1 | 3.0 |
| Central West | 2.4 | 4.0 | 3.0 | 3.4 |
| Coffs Harbour | 4.6 | 4.9 | 4.0 | 3.8 |
| Mid-North Coast | 2.1 | 2.6 | 2.1 | 2.0 |
| New England | 4.0 | 4.7 | 3.4 | 3.6 |
| Northern Rivers | 1.9 | 1.7 | 2.4 | 1.5 |
| Orana | 1.7 | 2.4 | 3.3 | 1.8 |
| Riverina | 2.6 | 3.3 | 2.3 | 3.4 |
| South Coast | 3.8 | 3.8 | 3.6 | 4.0 |
| South Eastern | 3.8 | 2.0 | 3.3 | 1.2 |