Sydney’s rental market is tightening as borders reopen and demand for short-stay accommodation picks up.
That is catching out people such as Anna Bruter who, with her husband and two children, moved into a Meriton serviced apartment in Bondi Junction in August while they renovated their family home nearby.
The family took out a 20-week lease on a two-bedroom apartment at $825 a week in the building that was close to their childcare and primary school.
But the renovation dragged on – it suffered delays from building materials and labour shortages – and the builder said he would not be done before their apartment lease ended on January 14.
Ms Bruter wanted to ask Meriton if they could get an extension, but says she never got the chance. Before she could discuss it, the company confirmed the end of their lease.
It said any extension of stay would have to be at the short-stay rate via the company’s booking portal, which she says shows a price of $10,931 for the extra month they need – well above the $3500-odd they are paying.
Unable to afford that much, they are trying to find new accommodation for the final month they need, a task made harder in the peak summer months.
“There’s no leeway. There’s no ‘We’re in this together’,” Ms Bruter said.
“Families like us are just in the crunch of it.”
The pandemic prompted many owners of short-stay accommodation to put their properties into the longer-term rental market.
But the reopening of domestic borders and a resumption in holiday and business travel is reversing that, and landlords – including serviced apartment owners – are responding.
Meriton owner and Financial Review Rich Lister Harry Triguboff said he dropped the rents on serviced apartments when the market of tourists and business travellers dried up and that he was under no obligation to keep offering a discounted rent.
“I didn’t have people to take them, I dropped the price by 70 per cent,” Mr Triguboff told AFR Weekend.
“What I’m asking from them now is only what I used to get. When I build a block of flats, I take into account what I can get, not what that poor woman wants.”
Inner-city Sydney and Melbourne rental vacancy rates that rocketed with the onset of the pandemic have been falling over the past six months – despite nudging up again in the most recent lockdowns – and SQM Research managing director Louis Christopher said they would fall further next year.
“If international borders stay open, and we’re getting international students continuing to come through plus other migration, we’ll see tightening in inner-city vacancy rates for 2022,” Mr Christopher said.
Sydney-based Crown Group owns three Skye Suites-branded serviced apartment buildings in Parramatta, Green Square and central Sydney’s Kent Street. During the pandemic, the company transferred 20 per cent of its Kent Street rooms to long stay, 40 per cent at Green Square and about 10 per cent in Parramatta.
Since restrictions were lifted in October, the company had halved the number of rooms in long-stay use at Kent Street and Parramatta, chief executive Iwan Sunito said.
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