Despite increased investor activity across Queensland, local agents report a greater number of sales of former investment properties to owner occupiers.
“Queensland is seeing a return to a tighter rental market,” said Real Estate Institute of Queensland (REIQ) CEO Anton Kardash after the release of the latest Residential Rental Survey.
“Stronger tenant demand and a decrease in the availability of stock are the common themes across the state,” he said.
Local agents are also reporting tenants deciding to move further out where they can achieve a larger property for the same weekly rent, such as Logan in southern Brisbane.
According to director of Rental Express Chris Rolls, the tighter rental market in this region may be due to resurgence on the Gold Coast.
“The decreased vacancies are probably a result of a rebound in rents on the Gold Coast which is pushing people further north into southern Brisbane … generally, if you take Brisbane as a whole, the greater area of southern Brisbane represents the best value for money,” Mr Rolls said.
According to the results from REIQ, the overall vacancy rate for the Brisbane metro area was down to 2.3 per cent, and all surrounding Local Government Areas recorded a drop of at least 0.3 percentage points.
Logan City and Redland City recorded the largest drops, both down 0.8 percentage points to 1.2 and 1.6 per cent respectively.
Brisbane has recently been designated as the investor capital for 2014 by leading economists such as Dr Andrew Wilson from Australian Property Monitors.
“I think the Brisbane housing market looks to be something that will induce more investor activity. Yields are still the highest of any of the capital cities, sitting above five per cent. It’s a tight rental market with low vacancy rates and rents keep rising, so yields are being maintained,” he said earlier this year.
Mr Rolls agrees that Brisbane is an area investors are keeping a keen eye on, and suggested that BDMs may have their work cut out for them when the floodgates break.
“Typically, investor activity increases the vacancy rate because there’s more supply. When investors begin buying up Brisbane property, the role of the property manager is going to be very important for landlords to market their property," he said.
“The more sales are made, the more rental properties available to manage, so it’s a good time to be active from a BDM perspective. If you’re in the middle of a hot market and you don’t have a BDM, your rent roll’s potential is going to be severely impacted.”