There are some green shoots appearing for desperate renters in Queensland, with vacancy rates slowly starting to rise.
According to the Real Estate Institute of Queensland (REIQ) Residential Vacancy Rate Report for the June 2023 quarter, the state-wide vacancy rate rose to 1 per cent for the first time since December 2021.
There were 38 regions across the state that saw vacancy rates increase, while they held steady in three and rose in nine.
While the biggest increases in vacancy rates were found in some of the top tourism hotspots, including Noosa, Redland’s Bay Islands and on the Sunshine Coast.
REIQ CEO Antonia Mercorella said the small increase was a positive sign for tenants and showed that conditions are improving.
“We’re starting to see some early signs of the rental market starting to soften just ever so slightly, with vacancy rates showing small increases in the majority of regions,” Ms Mercorella said.
“It was too early to call in the March quarter, which also saw a slight lift, but now with back-to-back, quarter-on-quarter improvement, we can see some promising green shoots.
“There is still a long way to go for Queensland’s rental market to reach healthy rates, but these results are a step in the right direction, with a little more movement and increasing opportunity and choice for renters wanting to get into the market.”
Ms Mercorella said the latest figures are consistent with what agents are saying on the ground.
“They say there’s more rental housing stock freeing up, particularly in higher price point suburbs, which have probably hit the peak of rent increases,” she said.
She said that because of the tough conditions for renters, many people have been forced to “think outside the box” and look for other options for more affordable rental accommodation.
“These alternative arrangements include moving back in with parents where possible, moving in with other tenants in a co-tenancy instead of sole tenancy, and looking for units or townhouses instead of a freestanding home, or casting their net wider by looking at nearby localities with greater supply,” she said.
A number of areas saw their vacancy rates increase 0.1-0.2 per cent across Greater Brisbane, including Brisbane LGA (1 per cent), Ipswich (1.1 per cent), Logan (1 per cent), Moreton Bay (0.9 per cent), Caboolture (1.1 per cent), Pine Rivers (1 per cent), Redcliffe (0.8 per cent), Redland (1.3 per cent) and Mainland (0.8 per cent).
The exception in Greater Brisbane was Redland’s Bay Islands where demand for ‘island living’ continues to weaken – rising to its highest-ever vacancy rate of 6.3 per cent.
Meanwhile, in Queensland’s tourism hotspots, there was a sharp increase in vacancy rates with Maroochy Coast (1.9 per cent), Sunshine Coast (1.6 per cent), and Caloundra Coast (1.3 per cent), while Noosa shot up to into the ‘healthy’ range with a rate of 3.1 per cent.
According to Ms Mercorella, the increase in vacancy isn’t necessarily a good thing in these types of markets, as it’s more likely that prices are now too high for local families to afford.
In Noosa, the median rent for a three-bedroom house is $700 per week, but notably, this remains unchanged compared to the previous year, indicating that prices might have reached a turning point as rental prices stabilise.
Similarly, the Gold Coast (1.2 per cent), Hervey Bay (1.3 per cent), and Fraser Coast (1.1 per cent) had more rental properties on the market for longer during the June quarter.
Ms Mercorella said demand for coastal living may have also cooled off slightly during the winter months, as seasonal markets typically do.
Maryborough (0.5 per cent) remained extremely tight but continued to show improvement given not long ago it was a market that hovered around 0.1-0.2 per cent for two years, and Cairns (0.9 per cent) also continued a slow but steady upward climb in vacancies.
Across regional Queensland, conditions for renters still remain incredibly challenging with the likes of Cook (0.1 per cent) and Goondiwindi (0.1 per cent) still having virtually no vacancies, while Southern Downs (0.2 per cent) and Tablelands (0.4 per cent) are extremely tight.
Gladstone (1.7 per cent) has the highest vacancy rate across the regional centres, while Bundaberg saw sharp jump to 1.1 per cent.
Mackay (0.8 per cent), Rockhampton (0.9 per cent), Toowoomba (0.9 per cent) and Townsville (0.9 per cent) all had fairly minor fluctuations, with all regional centres remaining stubbornly in tight territory.
Meanwhile, in the mining town of Mount Isa, there is still a ‘healthy’ vacancy rate of 2.7 per cent, with the median price for a 3-bedroom house sitting at $450 per week the same as the prior year.
While still considered tight, regional areas with the most rental availability in the June quarter include Cassowary Coast (1.5 per cent), Gympie (1.1 per cent), Isaac (1.1 per cent), Scenic Rim (1.1 per cent), Lockyer Valley (1.1 per cent), Whitsunday (1.1 per cent), Livingstone (1.0 per cent) and the Central Highlands (1 per cent).