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Queensland rental market: Major regions now in undersupply territory



Queensland rental market Major regions now in undersupply territory

After a number of years of fairly woeful market conditions, the Queensland rental market has officially turned a corner.

The Real Estate Institute of Queensland’s vacancy rate report for the March quarter showed most of the major regions across the state recorded vacancy rates below 3 per cent, which is to be the considered the equilibrium point of supply and demand.

A vacancy rate under 3 per cent generally means more demand than supply of rental stock.

One of the standout performers over the period – while recording a vacancy rate of 3.1 per cent – was inner Brisbane, with tenant demand continuing to soak up the excess new unit supply of recent years.

“Inner Brisbane has been the focus of significant media attention for the past few years as considerable apartment supply has visibly overwhelmed demand levels,” REIQ CEO Antonia Mercorella said.

“This oversupply peaked in the March quarter of 2017, when the vacancy rate reached 4.4 per cent, and since then the rental market has tightened steadily.

“The March quarter is a more consistent indicator of where the market is performing, and this market is now in tight territory.”

It’s great news for Brisbane landlords, potentially signalling the end of what had been a tenants’ market for a number of years.

The median asking rent for Brisbane houses increased from $400 a week to $410 in the December quarter, lifting for the first time in nearly three years – and the latest Domain Rental Report showed those prices continued to hold strong over the first quarter of 2019.

It’s the same story for units, with the median weekly asking rent not going up over the quarter but it did record a slight rise since the same time last year. The median weekly asking rent for a Brisbane unit is now $380, up $5 a week from March 2018.

Queensland rental market Major regions now in undersupply territory 1

Elsewhere in Queensland, rental markets have strengthened across the board. In Gladstone, the vacancy rate was down to 3.1 per cent, its healthiest result in about seven years.

“This quarter, Gladstone has stolen the spotlight with its long-awaited move into the healthy range, tightening from 4.2 per cent to 3.1 per cent, for the first time since December 2012,” REIQ Gladstone zone chair Alicia Williams said.

“This market has been gradually improving since it peaked at 11.3 per cent vacancies in March 2016.

“The inexorable downward trend has consistently suggested an improving market with rental supply and demand trends now the closest to intersecting in almost seven years.”

The impact of the Townsville floods in February was behind the dramatic drop in its vacancy rate over the March quarter.

Townsville’s vacancy rate decreased from 4.3 per cent to 1.5 per cent over the period, according to the data.

However, the undersupply was likely to only be temporary with the market slated to return to more moderate conditions in coming months, Townsville zone chair Wayne Nicholson said.

“Our forecast for the Townsville market is that as rental stock returns to the marketplace, the vacancy rate will ease again, although we wouldn’t be surprised if it stabilises in the healthy range of 2.5 per cent to 3.5 per cent towards the end of the year and into early 2020,” he said.

Brisbane’s vacancy rate recorded no change to be 2.5 per cent over the March quarter, while the Gold Coast remained in undersupply territory with a rate of 1.8 per cent.

The tightest vacancy rate of all major regions was the Fraser Coast with only 1.1 per cent of all rental properties vacant.

“Few rentals are advertised on popular listing portals and tenants are struggling for choice. Landlords definitely have the upper hand and local agents are telling us that they have multiple applicants per property,” Ms Mercorella said.




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Market Place

Brisbane’s cheapest suburbs by proximity to the CBD



Brisbane’s cheapest suburbs by proximity to the CBD

Brisbane’s cheapest suburbs closest to the CBD have been revealed — and if you’re in the market for a house, you can still pick one up for under $500,000, less than 10 kilometres from the CBD.

According to new data from Domain, there are still a number of sleeper suburbs close to the city centre that have median sale prices considerably less than their surrounding areas.

Houses in Keperra, Chermside and Everton Park, as well as units in Spring Hill, Clayfield and Bowen Hills, are some of the most affordable properties within a 10-kilometre radius. Moving further out to between 10 and 20 kilometres, units in Zillmere and Runcorn offer great value, as well as houses in Acacia Ridge, Thorneside and Durack.

Domain research analyst Eliza Owen said while the general rule was the further a suburb was placed from the CBD the more affordable it was, there were exceptions.

Brisbane’s cheapest suburbs by proximity to the CBD 1

“The average median for a Brisbane house within 10 kilometres of the CBD is $845,000, so take Stafford Heights, where a typical price is $600,000 — while that is still a lot of money, it’s relatively affordable when you’re looking at properties that close to the CBD,” Ms Owen said.

The data showed units within walking distance of the city centre for under $400,000, while the median for units up to 10 kilometres out is $460,000, Ms Owen said.

She said there were often reasons why these suburbs were more affordable.

“There are other factors that create pockets of relatively low prices. Being placed near industrial parks, having relatively low socio economics in there, being close to an airport or under a flight path and the nature of the housing stock can all affect a suburb’s value,” she said.

Suburbs less than 10 kilometres from the CBD

In Brisbane’s leafy north west, buyers after an affordable home can pick up a house at Keperra, where the median sale price is $530,000, although Christine McKay of Harcourts Solutions says many sell for less than that.

“Houses are selling from around $480,000 — often they’re pretty little post-wars, and they’re very popular with the young people,” she said.

“Keperra has a lot to offer apart from its proximity to the city and that’s the transport, schools, shops … all the infrastructure is here.

Brisbane’s cheapest suburbs by proximity to the CBD 2

“Why do people live here for 70 years? Because everything is here. It’s a lovely suburb and we’re finding people are buying these little post-wars and turning them into beautiful homes, lifting them, extending them and building in underneath.”

Other affordable suburbs included Chermside and Chermside West, in Brisbane’s north, and Everton Park, also in the north west.

For units, Moorooka, Bowen Hills and Clayfield were the cheapest, followed by Spring Hill, which is only one kilometre from the CBD.

Most affordable suburbs <10km

Brisbane’s cheapest suburbs by proximity to the CBD 4

Suburbs 10 to 20 kilometres from the CBD

A little further out from the city centre and prices come down further, particularly for houses. Inala, 14 kilometres west of Brisbane, has the cheapest median house price at $365,000.

The bayside suburb of Thorneside, which straddles the Brisbane coastline a little further along from Manly and Lota, has a median house price of just $432,000.

But it’s suburbs like Acacia Ridge, only 12 kilometres south of the CBD with a median houses price of $400,000, which agent Adrian Daynes of Daynes Property refers to as a “sleeping giant”.

“If you compare it to surrounding suburbs like Coopers Plains, Algester, Sunnybank or Salisbury, Acacia Ridge is right next to these suburbs but the prices are so much lower,” he said.

Brisbane’s cheapest suburbs by proximity to the CBD 3

“It’s a little bit unknown in that respect. Buyers come out to investigate the suburb and are pleasantly surprised because the quality of the home you can get here is 40 to 50 per cent cheaper than the neighbouring suburbs.”

Mr Daynes recently listed a three-bedroom, two-bathroom post-war house on 607 square metres of land at 15 Scouse Street, Acacia Ridge for $419,000 but said the same house would be worth $560,000 to $570,000 in Coopers Plains.

“A lot of our buyers here are first-home owners but we also get a lot of investors too as the rental yields are so high. They’ll buy a house for $350,000 and get $350 a week rent,” he said.

Most affordable suburbs 10-20km

Brisbane’s cheapest suburbs by proximity to the CBD 5

Suburbs 20 to 30 kilometres from the CBD

Unsurprisingly, house prices drop considerably by this distance, dominated by the LGAs of Logan and Ipswich.

Goodna, on Ipswich’s fringe, has excellent transport links via trains and the Ipswich Motorway to Brisbane’s CBD. With a median house price of $337,000, it is only 20 kilometres from the CBD.

Also in Ipswich, Collingwood Park and Redbank Plains, both with median house prices of $340,000, are located 23 and 26 kilometres respectively from Brisbane’s CBD.

Some of Greater Brisbane’s most affordable units, however, are located in Moreton Bay, north of Brisbane along the coastline.

Units at Woody Point, 25 kilometres out, have a median of $382,500, while neighbouring Redcliffe, 28 kilometres out, has a median of $384,500.

Most affordable suburbs 20-30km

Brisbane’s cheapest suburbs by proximity to the CBD 6



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Massive $6m sale in coveted stretch of riverfront



Massive $6m sale in coveted stretch of riverfront

A waterfront home on a coveted stretch — where neighbours include Australia’s richest woman Gina Rinehart — has sold for over $6 million over the weekend.

A waterfront home on a coveted stretch — where neighbours include Australia’s richest woman Gina Rinehart — has sold for over $6 million over the weekend.

Place Bulimba signed off on a riverfront property at 146 Virginia Avenue, Hawthorne, which fetched over $6m, agent Sarah Hackett confirmed.

The deal, one of the biggest for Brisbane in the residential sector this year, is a sign of positivity for the prestige end of the Brisbane real estate market.

Massive $6m sale in coveted stretch of riverfront 1

Negotiations were ongoing through election week, with the deal signed over the weekend,

The home is a four bedroom, two bathroom double garage set up sitting on a massive 1,433sq m block of waterfront.

Ms Hackett listed it as a “once-in-a-lifetime opportunity to build your own architectural masterpiece on one of Brisbane’s best riverside streets”.

Massive $6m sale in coveted stretch of riverfront 2

It has 24m of river frontage, a new, private jetty and pontoon, and stunning views across a wide stretch of the river.

“The original home is comfortable with a new, modern kitchen, large living and outdoor areas, soaking up the mesmerising views,” was how it was described, though the property also has development approval for a “Sumich Chaplin, dream, architectural home, with four ensuited bedrooms, six bathrooms, eight car accommodation and a huge outdoor entertaining and lawn area”.

Massive $6m sale in coveted stretch of riverfront 3

Ms Hackett expected good things out of the market this year, given the first five months had been stronger than last year.

“The election was a good because people just want confidence and a clear idea of what’s going to happen, but the market has been very strong this year because banks have started to lend this year and money is so cheap. It’s never been better to borrow.”

“We had 100 open houses on Saturday and they were all really busy … Late last year we found the market volatile. It was hard to get (bank) approval even for 14 days. This year we found a complete different turnaround.”




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One capital city holds steady as others record price falls



One capital city holds steady as others record price falls

Nearly every major capital city showed price falls, according to the latest weekly property market data, with the exception of one which held steady.

Combined, the daily home value index fell by 0.2 of a percentage point in the week ending 19 May, CoreLogic’s Property Market Indicator data showed.

Brisbane was the only capital city not to record a value fall, holding steady.

Meanwhile, Sydney, Melbourne, Adelaide and Perth all recorded declines, with Sydney falling the most at 0.3 of a percentage point, Melbourne declining by 0.2 of a percentage point, and then both Adelaide and Perth falling only by 0.1 of a percentage point.

The monthly index was down by 0.8 of a percentage point. It fell by 9 per cent for the year. Sydney, Melbourne and Perth recorded the highest declines for the year at 11.2 per cent, 10.2 per cent and 8.4 per cent, respectively.

New listing volumes were down, albeit to a lesser degree than the week prior, with nearly every single capital city recording a decline, except for Darwin, which held steady, resulting in a combined capital city loss of 22.4 per cent.

The largest declines were seen in Sydney at 28.7 per cent (making last week 13 weeks of new listing declines in a row), Melbourne at 26.4 per cent, Perth at 19.1 per cent, Brisbane at 18.5 per cent, Hobart at 12.3 per cent, Canberra at 18.1 per cent and Adelaide with the smallest decline again at 2.6 per cent.

Houses were again more popular than units, and the average time for houses on market rose in nearly every capital city, except for Brisbane, where it held steady, and Hobart, where figures declined.

Hobart was the capital city with the fastest time on market for houses at 38 days, followed by Melbourne and Canberra at 45 and 50 days, respectively; while Darwin, Perth and Brisbane had the slowest time on market at 90 days, 77 days and 71 days, respectively.

For units, Hobart was again the fastest at 34 days, while Darwin, Perth and Brisbane were again the slowest at 105, 82 and 71 days, respectively.

Vendor discounting was between 5.5 per cent and 8.2 per cent for houses across most capital cities and between 7 per cent and 10.3 per cent for units.

Canberra was the low-end exception for both houses and units at a respective 4 per cent and 5.3 per cent.

Darwin was again the high-end exception for houses and units at 9 per cent and 13.7 per cent, respectively.




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