Rentals Market Still Tight
Queensland rental markets are beginning to stabilise heading into the Spring selling season, although the Toowoomba rental market remains tight according to the Real Estate Institute of Queensland (REIQ).
The trend is revealed in the latest REIQ Residential Rental Survey, carried out at the end of June across REIQ-accredited agencies.
REIQ Acting CEO Antonia Mercorella said the stabilisation of the rental market coincided with a surge in sales across many parts of the State.
“Historically in Queensland we tend to see one market thriving more than the other and at the moment it’s the sales market that has the upper hand,” she said. “Vacancy rates still remain tight in many parts of the State, however according to REIQ members the rental market is starting to stabilise, with vacancies creeping up in some areas. This is the result of strengthening first home buyer activity, which is reducing tenant demand, along with increased investor activity which is increasing the rental supply in some areas.”
According to the Survey, the vacancy rate for the Toowoomba Region eased slightly to 1.5% at the end of June, compared to 1.4% at the end of March.
RE/MAX Success Broker/Owner and 2014 REIQ Property Manager of The Year Katie Knight said the 1.4% vacancy rate for the Toowoomba region reflected the continuing tight rental market.
“Our RE/MAX Success vacancy rate is currently below 1% but we are always under the industry average for our region with our office open 7 days a week to maximise opportunities for landlords and tenants, ” Miss Knight said.
“Toowoomba’s vacancy rate compares very favourably with other regional centres like Rockhampton with a vacancy rate of 4.8%, Townsville 5.4%, Gladstone 5.6% and Mackay 6.8%. Toowoomba’s vacancy rate has not exceeded 2% since 2011,” Miss Knight concluded.
Miss Knight forecast we could be entering unchartered waters with a potential oversupply of units to hit the rental market soon. With some 800 units currently under construction in Toowoomba it is conceivable to expect a fair percentage of these will be placed in the rental pool. This will also have the potential for rents on units to stabilise in the short term.
Miss Knight warned investors to seek professional advice from an experienced Property Manager when adding to their investment portfolio. Some developers may offer rental guarantees for 12 months that may not then be sustainable thereafter. “Toowoomba offers fantastic investment opportunities but to be forewarned about ensuring information is credible, is to be forearmed,” Miss Knight concluded.