While Sydney may be the most expensive city to rent in, a new report has revealed that certain Sydney suburbs are more affordable and have more properties available.
PRD Real Estate has released its Affordable and Livable Renting Guide 2023, which identifies the 'key suburbs' with the most rental potential.
The report surveyed around 500 suburbs within 20 kilometres of Sydney's metropolitan area, with criteria including rental prices below the Sydney median and a significant number of rental properties coming into the suburb, including residential projects that have already started construction.
Criteria also included 'liveability', including low crime and unemployment rates, and the availability of amenities such as shops and medical centres within 5km.
The analysis showed that Carlingford, Granville and Wiley Park were the best choices for renting, while Crows Nest, Summer Hill and Enfield were the top choices for buying a home.
PRD's chief economist, Dr Diaswati (Asti) Mardiasmo, said Sydney was easy to identify as it had more supply compared to other Australian capital cities.
There is still stock coming into these identified areas, she said. Sydney's strength is that the Inner West, Hills and Western Sydney districts have all emerged as areas with many suitable options for renters. If there is more choice across the city, it is less likely that everyone will suddenly move to one area, pushing up property prices. The map of all the planned developments also shows a good spread across the city. Compared to other capital cities, Sydney has far more planned developments, which is far better for the rental market.
Dr Mardiassimo said that while affordability and new entry were the main criteria, the report also considered crime rates. Some of these areas may be considered more rugged, but at the same time, people have to make the decisions that are most important to them. We made sure that these areas were considered safe and that their crime rates were lower than Sydney's overall crime rate. We tried to balance all the factors and some of these may not be the prettiest suburbs, but in a tight rental market, these will be our choices.
The report states that in the 12 months to June 2023, the median price of house and unit rents in Sydney rose by 22.5 per cent and 26.8 per cent to A$980 and A$710 per week respectively.
Rents for two-bedroom units showed the highest annual growth rate at A$750 per week.
The Sydney metropolitan area recorded a low vacancy rate of 1.7 per cent in June, higher than Brisbane and Melbourne.
The report also shows that residential development in metropolitan Sydney will remain at a healthy level during the first half of 2023, with 2,822 units/apartments, 149 townhouses, 315 homes and 343 plots planned for development.
Dr Mardiasmo said that on an international level, Sydney's rental market still compares favourably with New York, London and Auckland in terms of rent-to-income ratios.
Sydney's most affordable suburbs
Carlingford - median rent A$750, vacancy rate 3.6%, stock 88
Granville - median rent A$540, vacancy rate 0.7 per cent, stock 15
Wiley Park - median rent A$585, vacancy rate 0.3 per cent, stock 158
Units
Crows Nest - $580 median rent, 2.8 per cent vacancy, 45 per cent stock
Summerhill - median rent $520, vacancy rate 1%, stock 22
Enfield - $438 median rent, 1.4% vacancy rate, 71 units of inventory
