Sydney vacancy rates increase over January

Demand for rental properties across the state has eased, as documented in the latest Real Estate Institute of New South Wales (REINSW) Vacancy Rate Survey.

The Sydney metropolitan area sat on a rate of 2.2 per cent for January - up 0.3 per cent.

Outer suburbs - which are located more than 25 kilometres from the CBD - saw the biggest rise, with a 0.4 per cent increase to 2.2 per cent.

The middle suburbs (between ten and 25 kilometres from the CBD) have the highest vacancy rate, rising 0.1 per cent to 2.4 per cent.

Inner suburbs, which are located less than ten kilometres from the city, have a vacancy rate of two per cent - up by 0.2 per cent.

REINSW president Christian Payne said this trend stems from a slowdown over the holiday period, with the market expected to tighten up in the coming months.

He explained: "The shortage of rental accommodation looks set to continue because the NSW government has simply not done enough to encourage investment in the property market."

The president added that investors have a litany of choices when it comes to opportunities, and has called for incentives to be introduced to encourage investment in rental real estate.