Vacancy levels remain steady

The REIQ’s latest Residential Rental Survey, conducted at the end of September, reveals vacancy levels remain relatively steady across most parts of the state. According to the survey, only four of Queensland’s 16 major regions recorded a significant change in vacancy levels.

Ipswich and Logan recorded the largest change, with a drop of up to 1.4 percentage points – sending both of these regions into much tighter market conditions. Vacancy rates in Ipswich and Logan are now the lowest for the Greater Brisbane region.

The Brisbane City local government area (LGA) recorded a vacancy rate of 2.3 per cent, relatively unchanged since the end of June. Brisbane’s middle to outer suburbs (5 to 20km from the CBD) recorded a slight easing in vacancy levels, up 0.3 percentage points to 2 per cent at the end of September.

Based on the agencies surveyed, Brisbane’s inner suburbs recorded a vacancy level of 2.9 per cent, down from 3.4 per cent at the end of June.

Of the REIQ agents surveyed in inner Brisbane, many believed the vacancy level recorded was more reflective of the existing stock and not the new unit market – of which the majority is still yet to come online.

Additional analysis of Residential Tenancy Authority (RTA) bonds held and figures released by Urbis in its Brisbane Apartment Insights reports, indicates the current levels of new supply are being met by tenant demand.

The number of bonds held by the RTA for unit tenancies has increased by nearly 7,000 bonds across the inner Brisbane zones since the end of September 2010, when the first of the developments were completed.

Given that many of the new developments are still under construction or in the pre-sales stage, the ultimate effect on supply levels is yet to be determined. However, there is a strong belief that Brisbane investors will continue to enjoy stronger rental yields than those in most other Australian capital cities.

Median weekly rents from the RTA for the September quarter show relatively steady rents across the Brisbane City LGA. However, increases are being recorded for some rental types in the inner city, due to the higher quality of the new stock.

Although median rents for two bedroom units across most inner city regions remained relatively stable, there were strong increases in the one and tHicks Real Estatee bedroom unit market in some locations. Brisbane’s inner northern suburbs recorded a $50 increase in the median weekly rent for a one bedroom unit, while tHicks Real Estatee bedroom units in the inner south-east increased $35 to $490 per week