Domain rental vacancies increase as Adult kids move back in with Mum and Dad

The adult kids forced back home in the wake of COVID-19

This is interesting.

Domain economist Trent Wiltshire says Domain rental listing numbers had started to increase in the past week.

But do you think rental vacancy rates could hit in say 6 and 12 months time?

10 maybe 15%?

 

I think rents will just drop, but vacanies might stay low.

 

You are probably right. I remember the WA housing crash where all the squatters took up residency due to the sheer number of vacancies.

Most insurance companies wont cover premises vacant for anymore than about 6 weeks, so its cheaper insurance to drop the rents and get some in, than have to repair the premises out of your own pocket after squatters have vandalised it.

Perth’s high rental vacancy rate has resulted in rise in squatters

 

The oldies will kick their loser kids out in no time.

The temptation for the kids will be too great. Most likely free or cheap board. Enormous cooked meals with free beers.

Laundry, ironing all done for them. Bed done. Take over dad's garage. Smelly socks. Telly on loud at all hours.

Then last but not least the kids will start whinging about everything.

I'd give it 3 months before the old boy yells "grab your sh... and get the hell outa 'ere". lol.

 

Moving back with parents was expected. Same urban to rural dislocation due to disappearing jobs (COVID-19), has also been reported in other countries.

Why would anyone without income want to pay living expenses in Sydney and Melbourne ? Dole is the same, but dollar goes much further in Tamworth than Sydney; more so if staying with parents.

No one knows how long is this epidemic going to last and even when it does, it will take a while (months) before the economy returns to Business as Usual.

All those (not just adult kids) made recently redundant and with options to relocate will do so, even if to wait out the crisis.

A colleague of mine brought forward his retirement and has retired to his farm in Ballarat; management had no issues.

Boomers with retirement plans away from cities will also be actively considering their options - cheaper and safer.

Cumulative impact on Vacancies (especially single person/shared rentals):

• Oversupply.
• Reduced Immigration.
• Reduced students - both national and international
  
• Recently redundant adults with options

A lot is yet to unfold.

 

Dont forget all the Airbnb properties that have slowly lost most of their bookings.
According to one report the other day , Bondi alone has over 1000 listings, how many of these are slowly finding their way back onto traditional listings.
That probably happening all along the coastal and CBD areas in every city and towns all over Australia.

 

Adult kids move back home in every economic downturn.
Or go into share situations with friends instead of renting separately.

 

Our ever increasing population growth is going to stall this year that alone would be enough damage to the built to rent 1 bedder apartments that have been built in massive numbers add all the adults moving back with mom and dad and we will see half empty towers all over the place.

Our only immigration for the next few months will be refugees(if they can get a flight) they will likely be in family groups. Also I can see many Australians that live abroad returning home majority of those that are single will likely go back with mom and dad, families will seek out family homes. I see family friendly properties being relatively stable in these times

 

I am sure some never leave....

 

My sentiment exactly:

Can’t see this impacting your family friendly 3-4 bedders. These family household incomes (in Sydney) are in the Tier 3/ Tier 4 brackets, $250k (collectively) plus. They’re less likely to be effected by the hospitality and restaurant trade (I’m not saying this crisis is exclusive to these sectors).

1 and 2 Bedders in rental hot spots will be a frequent feature. I know of a lot of Irish and British (some have been here 1 year, some 10) going home after losing jobs. Friends of friends would turn this number into the hundreds, nationally 1,000s. Add to that the number of backpackers/ economic migrants putting off their migration plans until things become more certain.

Begs the question: short-term skills shortage when things kick off properly again = wage growth?