Looks like someone forgot to tell Sydney’s inner west about its alleged oversupply of apartments.
For example here are the results for Erskineville:
Here’s St. Peters results:
You can also add to this Haberfield, Stanmore, Sydenham, Five Dock, Canada Bay, Abbotsford, Chiswick, etc. etc. all of which have remarkably tight vacancy rates of 1 per cent or under.
Heck even Waterloo and Zetland have a vacancy rate of 0.5 per cent (OK, so that one might not a real number).
Maybe when we start to see some numbers beginning with a 4-handle it might start to get interesting, but if anything, for quality properties at least, the rental market actually seems to be tightening and rents rising.
Out west? Maybe a different story there, granted.
The Reserve Bank made reference to the monumental Chinese demand for apartments and a possible oversupply risk in its Financial Stability Review (FSR) this week.
But are Chinese owners really renting them out, or are they just leaving them vacant for future capital growth, or for their children to use when they come to Australia as international students, or for using during the odd holiday trip?
Wealthy Chinese investor see Sydney and Melbourne as far better value than local “tier one” cities.
Note how a high percentage of empty homes in cities such as Sydney have been found to be in the areas targeted by Chinese buyers e.g. Haymarket.
As for whether Chinese owners will sell when the cycle next turns down?
Anything is possible, but I’d suggest that financial returns are only one aspect of Chinese demand, and not necessarily the primary motivation.