Property News

Queensland's rental market in crisis

04 December 2006

Low house vacancy rates confirm that Queensland's rental market is in crisis, according to the latest research by the Real Estate Institute of Queensland (REIQ).

According to REIQ's September quarter figures, people are struggling to find rental accommodation in the inner and outer suburbs of Brisbane, Maryborough and Gladstone. The results also indicate a lack of sufficient rental vacancies in other parts of the state including the southern Darling Downs area and the northern regions of Townsville and Rockhampton.

Brisbane’s inner suburbs had house vacancy rates of just 1.4%, its middle suburbs had 1.7% and the outer suburbs were the tightest of all three at 1.3%.

Maryborough vacancy rates were just 0.9%, Gladstone had 1.6%, Warwick and the southern Downs were 1.1%, Townsville was 1%, and Rockhampton had 1.9%.

Unit and townhouse vacancy figures in most parts of the state are also historically tight for the September quarter.

REIQ chairman Peter McGrath said the figures show that the affordability of rentals continues to be squeezed, forcing Brisbane residents into the outer suburbs to find reasonably priced rental accommodation.

"With an additional 1200 people coming to the sunshine state from interstate or overseas every week, there are simply not enough houses to accommodate everyone. Demand is one of the key drivers of higher rents and this trend is likely to continue with Queensland’s population and resources boom not showing any signs of abating," Mr McGrath said.

"The vacancy rate of just 1.3% in Brisbane’s outer suburbs shows that demand for homes close to the city has pushed rents out of reach for most people and they are now forced to look further a field for more affordable rental properties," Mr McGrath added.

Mr McGrath said with more people trapped in the rental market due to the country’s deteriorating housing affordability, the situation is not likely to improve soon.

The situation is expected to worsen, with the REIQ predicting the November interest rate rise to further negatively impact on the supply of affordable rental properties.

Mr McGrath added that while the current tight rental market is encouraging more investors back into the market, the government needs to do more to improve the supply of affordable rental houses and apartments.