Rental demand in Queensland heating up

Rental demand in Queensland heating up

Posted on Tuesday, May 01 2012 at 3:53 PM

Rental vacancy continues to tighten across Queensland, with the majority of cities now seeing vacancy rates fall to below three per cent, according to the Real Estate Institute of Queensland (REIQ).

The first major contributor to
this tightening vacancy is the slower sales activity over the past 12 months,
leaving potential first homebuyers stationary in rental properties, REIQ chief
executive officer Anton Kardash said.

The second contributor is the
series of natural disasters experienced in the first half of 2011, causing many
homeowners and renters to seek short-term accommodation elsewhere while
dwellings were under repair.

“However, this pent-up demand is now starting to
dissipate with the latest Australian Bureau of Statistics (ABS) data showing
increasing numbers of investors and first-timers coming back into the market,”
Kardash said.

The number of Queensland
property investors increased in February, up from the same period 12 months
ago, according to the ABS lending finance figures.

Across Brisbane the rental
vacancy rate dropped to 1.7 per cent, from 2.3 per cent in December 2011. Inner
Brisbane demonstrated an even tighter 1.4 per cent vacancy rate, down from 1.9
per cent in December.

The Gold Coast rental market is
also tightening, with well-priced houses preferred over units. The vacancy rate
shifted from 5.2 per cent in June 2011 down to 3.9 per cent in March this year.

Looking north to the Sunshine
Coast, the vacancy rate has dropped from 4.9 per cent to 3.1 per cent over the
same period.

Elsewhere in Queensland, the
Rockhampton market recorded a very tight one per cent vacancy rate in March,
the tightest rental market across the state’s major regions with tenancies
filling in less than a week. This should ease though, with local agents
reporting renewed investor activity.

Mackay’s vacancy rate has eased
from 0.7 per cent in December down to 1.7 per cent in March due to leases
expiring and the upper end of the market slowing. Agents report more than 10
applicants per listing. Investor activity is rising.

The Cairns rental market is
improving after a long spell of inactivity. The March vacancy rate was recorded
at 2.5 per cent, down from 3.8 per cent in the same period 12 months ago. A
recovery in the tourism industry and improving job opportunities is reportedly
the trigger for a tightening rental market.

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