With rental vacancy rates at an all time low in Sydney, Adelaide and Perth and new property development stagnant in many areas, there is a critical need for investors to return to the market to meet pent up demand.

After a small improvement in January, Sydney's vacancy rates have reached a new low, indicating the shortage of rental accommodation is not a myth but a reality faced by those looking for somewhere to live.

The NSW Government needs to take immediate action to stimulate property investment by slashing property taxes, the Real Estate Institute of NSW said today.

REINSW has welcomed the Reserve Bank of Australia's recognition that the low level of rental vacancies is likely to lead to significant rent increases.