It’s no lie that Southeast QLD has experienced the tightest vacancy rates in 20 years and we see many tenants faced with higher cost of living due to the increases in rent as the demand on property escalates.
But why are vacancy rates so tight? There are a couple of reasons, I believe.
The investors have had an average run in QLD in the last 10 years, rents didn’t move much, increased costs were applied and many of the taxation benefits of being an investor were removed. So, when the market prices changed many long term investors decided to cash in their chips.
Ok- but someone had to buy the houses, right? Yes, they did however over 30% of the rental properties sold were sold to owner occupiers.
The building game also has an impact on this – Southeast Queensland is about 5 years behind where it needs to be with the release of land and the knock on affects from material supplies and workforce issues after covid have meant build times have went from approximately 4 months to 12 months (some longer so I am told).
Like any consumer behaviour the market relies on supply and demand and so even with the higher entry purchase prices, its still a great strategy to invest in property. The returns are strong, the demand is consistent, and property is still the most tangible asset you can own.
See article in the Redland city bulletin (pg46).