Brisbane vacancy rate tightens to 1.7% as investors hold back or sell: REIQ

The Brisbane residential market slipped further into undersupply in the September quarter as the vacancy rate tightened from 2.1% to 1.7%. according to the latest data from Real Estate Institute of Queensland (REIQ).

A balanced market between landlords and renters is said to exist at a vacancy rate of 3%.

In the Brisbane suburbs, the rental vacancy rate tightened noticeably from 2.4% to 1.9% while in the already tightly held inner Brisbane market (within five kilometres of the CBD), the vacancy rate fell from 1.6% to 1.5%.

Property managers attributed the further tightening in the inner-Brisbane market to slower market activity over the three-month period, with tenant interest highest for new properties.

In the suburbs, estate agents attributed the fall in vacancy rates mostly to do with a lack of buying activity from investors as well as some investors opting to sell their properties instead of renting them out.

The tightening of the rental market extended into the outer reaches of the Brisbane market, with the Brisbane surrounds, which includes Ipswich, Logan, Moreton Bay and Redland City, posting a vacancy rate of 2.2%  – down from 2.7% at the end of June.

REIQ chief executive Anton Kardash says vacancy rates are continuing to trend into undersupply territory as investor activity slowly swings back into life.

REIQ analysis of ABS data shows there were about 3,900 dwellings financed to Queensland investors in August – up 19% on the same period last year – but still well below the historical figure of 5,000 dwellings financed per month.

‘‘The rental market across Queensland has been constricted for more than two years now,’’ Kardash says.

‘‘The reasons for this have been the low numbers of investors in the marketplace as well as the generally slow property sales market over the period.

‘‘With the reduction in the numbers of properties being added to the rental pool, we are seeing more demand for a much smaller supply of properties.’’

The Gold Coast posted a vacancy rate of 3.5% – an improvement on 4% in June, while on the Sunshine Coast the vacancy rate tightened from 3%to 2.5%.

On the Gold Coast, the REIQ says demand is predominantly for houses over units, while higher-end properties are also doing well.

“The majority of rental properties [on the Sunshine Coast] are taking one to two weeks to relet and are attracting between two and five applicants,” says the REIQ.