The Sydney rental market is gaining some breathing room, with vacancies their highest in more than five years.

New data from the REINSW shows that metropolitan Sydney’s vacancy rate rose 0.3% to 1.9% for January, the largest monthly rise since July 2010.

Areas outside Sydney also saw a spike in available rentals. Newcastle saw vacancies climb from 1.1% in December to 1.5% in January, while vacancies in Wollongong rose 0.2% to 2.3% for the same period.

In spite of Sydney's loosening rental market, REINSW president Christian Payne has warned that the trend may be short-lived.

"January and February are traditionally peak periods for change in the rental market across NSW as school leavers, university students and families changing jobs or schools settle into new properties. Those looking to join the rental market or move properties from March onwards will find that availability could deteriorate sharply," Payne said.


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