Queensland’s latest rental vacancy report shows that there is now “virtually nowhere to go” in some parts of the state, with three regions recording just 0.1 per cent.
The tightest rental markets in Queensland can now be found in Goondiwindi, Southern Downs and the South Burnett, according to the latest REIQ Vacancy Report.
But the biggest decrease in vacancy rates over the last quarter was in Brisbane’s inner city suburbs, Caloundra, Whitsundays and the South Burnett, with each of those markets recording a fall of 0.2 per cent.
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Nineteen markets “plateued”, with vacancy rates unchanged from the previous quarter.
Those markets included parts of Brisbane (between 0.6% and 0.8%), Ipswich (0.6%), Sunshine Coast (0.6%), Fraser Coast (0.5%), Hervey Bay (0.6%), Maryborough (0.2%), Cairns (0.5%), Gladstone (1.0%), Rockhampton (0.4%), Townsville (0.5%), Banana (0.5%), Cassowary Coast (0.8%), Goondiwindi (0.1%), Livingstone (0.4%), Southern Downs (0.1%) and Tablelands (0.2%).
Fourteen markets experienced a small increase in vacancy rates of just 0.1 per cent, according to the report.
REIQ CEO Antonia Mercorella said it was unlikely vacancy rates would see any significant shifts in the foreseeable future due to complex supply and demand constraints.
“These statistics aren’t just numbers, they tell a story about how challenging it is for people struggling to find a home,” Ms Mercorella said.
“While I wish I could tell these people that we can see light at the end of the tunnel for them, the sad reality is that renters could be enduring this tight market for some time.”
Ms Mercorella said the average household in Queensland had shrunk to 2.5 people, which was putting further strain on housing supply, and that was before adding the extraordinary external pressures from high levels of migration and immigration to come.
“We know there are various obstacles which have been holding back our state’s housing supply and pathways to home ownership,” she said.
“This is what needs to be rectified in order to restore some balance to the market and address the true cause of the crisis – while also finding remedies for the symptoms.”
A healthy vacancy rate, according to the REIQ, should sit between 2.6 and 3.5 per cent.
Just one market sits above that healthy range – the Bay islands with a vacancy rate of 4.2 per cent.
All other markets sit well below that healthy range, with just three having vacancy rates north of 1 per cent – Gladstone (1%), Isaac (1.1%) and Mount Isa (1.3%).
The sobering report highlights just how tough it has become for renters in the Sunshine State.
In Greater Brisbane, vacancy rates have fallen from a high of 3.3 per cent in September 2016 to just 0.7 per cent now, while in the Brisbane LGA, they have tumbled from 4.1 per cent to 0.8 per cent in that same period.
On the Gold Coast, vacancy rates have fallen from a high of 5.2 per cent in June 2011 to just 0.6 per cent now, while it is a similar story on the Sunshine Coast.
And it is not much better in the regions, with Cairns falling from 3.7 per cent (June 2011) to 0.5 per cent now, while in Townsville it has fallen from 6.4 per cent (December 2016) to 0.5 per cent.
In our tightest markets, the fall to just 0.1 per cent is even more stark, with vacancy rates in Goondiwindi falling from a high of 5.9 per cent (March 2019), in Southern Downs from 6.4 per cent (September 2019) and South Burnett from 6.1 per cent (June 2016).
Ms Mercorella said that the State Government had identified that Queensland has 55,000 fewer rental dwellings than expected based on historical trends and forward projections.
“We have been warning for some time now that regulatory intervention, including more onerous lending changes and tougher tenancy laws, has an impact on investment,” she said.
“Increasingly, we are also seeing investors charged at higher rates for property related fees and expenses, including stamp duty costs, higher local government fees, and mortgage repayments.
“In the face of these challenges, we are seeing some investors making the choice to exit the market and more needs to be done to retain and attract investors to the long-term rental market to pump up the rental pool and boost vacancy rates.”
Meanwhile, the PropTrack Rental Report September 2022 recently revealed that Brisbane recorded the strongest rental growth in the countrym up 14.1 per cent, followed by regional Queensland, up 12.9 per cent.
Demand per listing in many parts of the state has also soared, according to that report.
PropTrack director of economic research Cameron Kusher said it was a tough time to be a renter in Queensland.
“The number of new listings coming to the market remains insufficient to significantly increase supply and alleviate the escalation in rents. These conditions appear set to persist for some time,” Mr Kusher said.
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