Qld vacancy rates shrink back after modest gains
Rental market conditions in Queensland have tightened slightly over the September 2023 quarter, an unfortunate move in the state where rentals are hard to come by.
The Real Estate Institute of Queensland’s (REIQ) Residential Vacancy Rate Report indicates that while the vacancy rate remains tight at 1 per cent, most areas have not experienced a significant decrease in vacancy rates compared to the previous two quarters.
Out of the 50 regions covered in the report, 32 regions experienced tightening conditions, while 11 regions held steady and only seven regions saw a relaxation in the rental market. However, the tightening was minor, with most markets experiencing a decrease of only 0.1 per cent to 0.2 per cent.
REIQ CEO Antonia Mercorella said while the state has started to see some more “for lease” signs popping up, rental stock is still getting snapped up quickly.
“Over the September 2023 quarter, we can see that we’re still in a situation where there simply isn’t enough rental supply or choice for tenants,” Ms Mercorella said.
“Given these competitive conditions, there’s less turnover of tenants with the median length of tenancies growing to 22 months for houses and 17.4 months for units,” she added.
While more rentals are becoming available, for prospective tenants it feels a bit like if they blink they’re gone, as new listings are being snapped up in record time.
“Even our less densely populated areas are experiencing the squeeze – in some regional markets, rental listings are an extremely rare commodity as evidenced by a shocking zero vacancy rate in Cook Shire this quarter,” Ms Mercorella noted.
The region located at the northern tip of Queensland hit the rock bottom of vacancy rate of 0 per cent, while the Goondiwindi region, along the NSW border, also had virtually no vacancies at 0.1 per cent.
Ms Mercorella said that despite slim pickings all over, it is important to note that for the most part, conditions have not dramatically changed this quarter. According to REIQ, renters actually have slightly more choice now than they had a year ago.
“Previously we had two consecutive quarters of vacancy rates softening, and this slight tightening during the September quarter is not significant enough to undo all of that welcome reprieve,” Ms Mercorella said.
Charters Towers (0.2 per cent), Southern Downs (0.3 per cent), Banana (0.3 per cent), Maranoa (0.4 per cent), South Burnett (0.4 per cent), Tablelands (0.4 per cent), Maryborough (0.4 per cent) and Mareeba (0.5 per cent) were regions at the lower end, with vacancy rates showing the extreme squeeze.
In the regional centres, Rockhampton (0.9 per cent) and Livingstone (1 per cent) held steady, while Mackay (0.5 per cent) and Toowoomba (0.6 per cent) both experienced a slight dip.
Gladstone was the regional market with the most vacancies at 1.6 per cent, with Cassowary Coast close behind at 1.5 per cent.
Bundaberg, Gympie, Lockyer Valley and Scenic Rim all lifted slightly to 1.2 per cent, while Townsville, Central Highlands and Isaac dipped to 0.8 per cent.
The quarter did hold some stories of hope, however. Burdekin experienced a significant swing, with the vacancy rate rising from 0.9 per to 1.4 per cent – even with sugar cane crush season in full swing.
In the south-east, Greater Brisbane, Brisbane LGA, as well as inner, middle, outer Brisbane suburbs, and Ipswich all matched the statewide vacancy rate at 1 per cent.
Logan, Caboolture and Redland posted 1.1 per cent vacancies, while Moreton Bay (0.9 per cent), Pine River (0.8 per cent) and Redcliffe (0.6 per cent) were on the tighter end.
For those ready to embrace island life, Redland’s Bay Islands had a very weak vacancy rate at 6.2 per cent.
Meanwhile, Mount Isa walked the line between a tight and healthy market with a vacancy rate of 2.5 per cent.
The biggest backtrack could be seen in Noosa, which shrunk to 2 per cent in the September quarter after a high of 3.1 per cent in the June quarter.
Similarly, the Sunshine Coast SD (1.5 per cent) and Hinterland (1.4 per cent), as well as nearby Maroochy coast (1.4 per cent) showed notable drop in rental listings over July to September, perhaps reflecting season-driven migration trends.
Smaller dips were seen in the tourism markets of Caloundra Coast (1.2 per cent), Whitsundays (1 per cent), Hervey Bay (0.9 per cent) and Fraser Coast (0.8 per cent).
The Gold Coast (1.2 per cent) and Cairns (0.9 per cent) remained unchanged.
While the state is in clear need of more supply in the rental market, Ms Mercorella looks on the bright side of the September quarter’s numbers.
“Vacancy rates act as a report card for the health of our rental markets, and while results vary across the state, a relatively stable September quarter hasn’t dashed our hopes that healthier rates could still be on the horizon.”