Quality over quantity key to unlocking 20-year rental low
The performance gap between quality apartments and investment-grade product will continue to widen as developers respond to declining rental growth, according to leading property firm, Mosaic Property Group.
Managing director, Brook Monahan said despite doom and gloom on rental growth figures, quality over quantity will always reign supreme in responding to the highs and lows of property market cycles.
“Rental growth has now slowed to a 20-year low as rental supply in the capital cities rises,” Mr Monahan said.
“The latest CoreLogic RP Data figures show the year on year growth in asking rents fell to 0.7% from 0.9% in July, the lowest since records started in December 1995.
“If you are investing in property, then there has never been better proof that you need to stand out from the pack, as increased supply and declining population growth influence Australia’s rental market.
“We strongly believe that there remains – and will continue to remain – a massive flight to quality in the next stage of the Brisbane residential cycle.
Mr Monahan said rental success on Mosaic’s newest completed project, Cove on Camborne, demonstrated that well researched, individually designed properties continue to deliver strong yields in a slowing rental market.
“There is a large gap in quality across different product being delivered to the market,” he said.
“Mosaic’s property management experts successfully tenanted 100% of investor-owned apartments at Cove on Camborne in Alderley prior to settlement, for above market rent and with over performing gross yields.
“This could only be achieved through a mandate for quality developments and use of in house construction and property management teams to ensure our development ethos is carried throughout the project life cycle."
Mr Monahan said Mosaic Property Group retains long-term property management rights on all of their developments, helping to achieve higher rental returns for their clients by maintaining control over all aspects of the development.
