FIND YOUR LOCAL BUYERS' ADVOCATE:
    TALKS & PODCAST           CALL US CALL US
1300 655 615
 
 

The
Propertybuyer

Podcast

Hear the latest weekly insights into the property market via podcast by Rich Harvey, CEO and founder of Propertybuyer.

 
Fri 3 May '24 with Rich Harvey Unpacking the Northern Beaches with Incredible Agents
 
 
Fri 29 Mar '24 with Rich Harvey How to build a $7 Million Property Portfolio from scratch
 
 
Sat 16 Mar '24 with Rich Harvey Why Invest in Melbourne?
 
 
Mon 26 Feb '24 with Rich Harvey Sydney’s Inner West – Hotspots and Outlook for 2024
 
 
Mon 12 Feb '24 with Rich Harvey Decoding Sydney’s North Shore Market – Outlook and Opportunities.
 
 
Sat 27 Jan '24 with Rich Harvey Home Buying in the Eastern Suburbs – A personal journey
 

 

Listen to many more
podcasts on our
Podcasts page.

 
 
 

Propertybuyer Blog
Property advice, market updates & more

 

Brisbane's Record-Breaking Rental Market - October 2022

October 11, 2022 / Written by Rich Harvey

 

By Rich Harvey, CEO & Founder, propertybuyer.com.au

There’s a lot to love about Brisbane. It’s grown to become one of Australia’s most exciting cosmopolitan capitals. There might be some from interstate who continue to regard it as Australia’s “big country town” but I venture they haven’t visited anytime in the past decade.

The River City offers an abundance of fantastic lifestyle options. There’s world-class dining and entertaining, not just in the CBD and adjacent Fortitude Valley, but throughout the suburbs as well.

The climate is a joy too. A winter’s days in Brisbane is like a Melbourne spring morning. And for those wary of the more humid summer, there’s a short drive to some of Australia’s best beaches.

There’s plenty to love but, in some ways, Brisbane is also a victim of its own success. Demand for housing has translated into one of the greatest challenges the city and its nearby regions have had to face.

Brisbane is now officially the toughest rental market in Australia after logging the country’s highest annual rise in weekly prices, with regional Queensland not far behind.

There’s now a dire shortage of rentals, and it’s only set to get worse.

 

Market dynamics

According to the latest PropTrack analysis, Brisbane’s median weekly rental prices had increased at the fastest year-on-year pace on record in the September quarter, having risen a record 14.1 per cent annually.

Regional Queensland figures were not far behind with a 12.9 per cent surge in median weekly advertised rents over the year to September.

Brisbane’s vacancy rate is tracking at an astonishingly low 0.7 per cent. That means there’s one available property for every 143 occupied rental homes.

The problem is due to the economic levers of demand versus supply.

First up, the supply of available rentals has been stymied by a range factors, most of which are political in nature.

An ongoing campaign across all levels of government – put particularly at the state level – has disincentivised investors. This includes higher land taxes and stamp duty, as well as greater CGT liabilities and reductions in claimable depreciation benefits for investors.

In addition, there has been an evolution of tenancy legislation that’s been heavily weighted in favour of renters. This has included factors such as tenants having more rights around keeping a pet at the property and making alterations to the home.

There’s also been relentless pressure from minor political parties such as The Greens who are pushing to implement rental freezes now and legislated maximum rent increases in the future.

Therefore, landlords are leaving in droves.

In fact, a study by the Property Investment Professionals of Australia based on their most recent Investor Sentiment Survey showed nearly 30 per cent of rental dwellings have been stripped from the Queensland market in two years as more than 160,000 investment properties were potentially sold to homebuyers. The survey also found that a staggering 45.1 per cent of investors had sold at least one property in the Sunshine State in the two years to August this year.

 

The solution

There will be multiple layers to the solving Brisbane’s rental market crisis, but they must come from a place of generating more supply.

I think the most effective thing politicians and others could do straight away is to stop vilifying property investors.

Describing investors as greedy, house-hording elites is plainly wrong. Most Aussies investors are on average wages and have only one or two rental investments. They’re hardly the ‘landed gentry’ that gets portrayed by special interests in the media.

Attacking investors is also clearly not winning over the electorate either. It’s amazing how vocal landlords become when they’re misrepresented – and they’ll make their disgust known at the ballot box. In fact, leaders of major political parties need to loudly denounce suggestions from minor politicians about rental freezes, capped increases and anti-landlord legislative changes if they want to keep their jobs.

Secondly, stop looking at ways to excessively tax investors. They’re clearly at their wits end and are exiting the market at an alarming rate.

Finally, start looking at ways to stimulate supply through incentivising investment and construction. Small moves can make a big difference. Guarantee negative gearing won’t be touched. Look to make depreciation allowances more enticing. Take another look at stamp duty, rates, CGT and other charges, and consider bringing those investor costs back in line with owner occupiers.

Do these things and our leaders might find Aussie investors will again embrace real estate as an asset, thus boosting the supply of shelter for people who need to rent.

 

 

  To have one of our friendly  Buyers' Advocate's contact you, click here to:

Send us your property brief   or

call us on 1300 655 615 today.

The Propertybuyer
Podcast

 
Fri 3 May '24
with Rich Harvey
Unpacking the Northern Beaches with Incredible Agents
 
 
Fri 29 Mar '24
with Rich Harvey
How to build a $7 Million Property Portfolio from scratch
 
 
Sat 16 Mar '24
with Rich Harvey
Why Invest in Melbourne?
 
 
Mon 26 Feb '24
with Rich Harvey
Sydney’s Inner West – Hotspots and Outlook for 2024
 
 
Mon 12 Feb '24
with Rich Harvey
Decoding Sydney’s North Shore Market – Outlook and Opportunities.
 
 
Sat 27 Jan '24
with Rich Harvey
Home Buying in the Eastern Suburbs – A personal journey
 

 

Listen to many more
podcasts on our
Podcasts page.