Vacancy rates edge higher in mining towns

Vacancy rates edge higher in mining towns

19 April 2013 by Simon Parker 0 comments

Staff Reporter

Residential vacancy rates are rising in a number of key mining towns, with investors being urged to be on guard for any negative shift in the broader economy and resources sector.

Figures released this week by SQM Research suggest towns such as Karratha (March vacancy rate of 3.7 per cent), Port Hedland (4.6 per cent) and Gladstone (5.6 per cent) are seeing less demand for rental property.

“We are now watching the data very closely on the various mining towns in the country,” said managing director of SQM Research, Louis Christopher.

“Property investors over the past 10 years have done extraordinarily well if they held real estate in mining towns. However, there is always a risk that when a down turn arrives, these markets could have a very rapid and severe correction.

“We remind investors to remain very cautious when it comes to these towns.”

For other capital cities, SQM reported that vacancies generally remained steady or modestly declined for the month of March. The net result at a national level during the month was 52,931 vacancies, which represented a vacancy rate of 1.9 per cent, similar to the preceding month.

Of the capitals, Adelaide reported a vacancy rate of 1.3 per cent in March, which was the same as the previous month; Perth was at 1.0 per cent, up 0.1 per cent; Melbourne came in at 2.6 per cent, down 0.1 per cent; Brisbane recorded a 1.7 per cent vacancy rate, down 0.1 per cent; Canberra’s rate hit 1.4 per cent, up 0.2 per cent; Darwin’s fell 0.1 per cent to 1.2 per cent, while Hobart reported a 0.1 per cent drop to 2.0 per cent.

SQM said Canberra’s rise in rental vacancies has also been noticeable since July 2012 and may be associated with a well-known increase in apartment developments, together with federal government attempts to reduce the budget deficit.

At this stage, SQM said it is too early to make a valid assumption as to why vacancies may be beginning to loosen in Perth, however it should be noted SQM Research regards the vacancy rate in this capital city as still in favour of landlords.

Contrastingly, Melbourne has revealed a gradual decline in vacancies over the past months, falling from above three per cent in December 2012 down to 2.6 per cent in March 2013. This is seen as a positive for this capital city, which has been recording elevated levels in vacancies for quite some time now.

SQM said its calculations of vacancies are based on online rental listings that have been advertised for three weeks or more compared to the total number of established rental properties.

Staff Reporter

Residential vacancy rates are rising in a number of key mining towns, with investors being urged to be on guard for any negative shift in the broader economy and resources sector.

Figures released this week by SQM Research suggest towns such as Karratha (March vacancy rate of 3.7 per cent), Port Hedland (4.6 per cent) and Gladstone (5.6 per cent) are seeing less demand for rental property.

“We are now watching the data very closely on the various mining towns in the country,” said managing director of SQM Research, Louis Christopher.

“Property investors over the past 10 years have done extraordinarily well if they held real estate in mining towns. However, there is always a risk that when a down turn arrives, these markets could have a very rapid and severe correction.

“We remind investors to remain very cautious when it comes to these towns.”

For other capital cities, SQM reported that vacancies generally remained steady or modestly declined for the month of March. The net result at a national level during the month was 52,931 vacancies, which represented a vacancy rate of 1.9 per cent, similar to the preceding month.

Of the capitals, Adelaide reported a vacancy rate of 1.3 per cent in March, which was the same as the previous month; Perth was at 1.0 per cent, up 0.1 per cent; Melbourne came in at 2.6 per cent, down 0.1 per cent; Brisbane recorded a 1.7 per cent vacancy rate, down 0.1 per cent; Canberra’s rate hit 1.4 per cent, up 0.2 per cent; Darwin’s fell 0.1 per cent to 1.2 per cent, while Hobart reported a 0.1 per cent drop to 2.0 per cent.

SQM said Canberra’s rise in rental vacancies has also been noticeable since July 2012 and may be associated with a well-known increase in apartment developments, together with federal government attempts to reduce the budget deficit.

At this stage, SQM said it is too early to make a valid assumption as to why vacancies may be beginning to loosen in Perth, however it should be noted SQM Research regards the vacancy rate in this capital city as still in favour of landlords.

Contrastingly, Melbourne has revealed a gradual decline in vacancies over the past months, falling from above three per cent in December 2012 down to 2.6 per cent in March 2013. This is seen as a positive for this capital city, which has been recording elevated levels in vacancies for quite some time now.

SQM said its calculations of vacancies are based on online rental listings that have been advertised for three weeks or more compared to the total number of established rental properties.

promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2016

With a combined sales volume of $13 billion in 2016, the Top 100 Agents ranking represents the very best sales agents in Australia. Find out what sets them apart and learn their secrets to success.

featured podcast

featured podcast
William Phillips on how agents can expand their database and grow their business

In this episode of Secrets of the Top 100 Agents, host Tim Neary is joined again by William Phillips to discuss the real estate database and...

View all podcasts

Are dodgy agents being punished enough?

Yes (8.6%)
No (55%)
Only in some states (2.3%)
Not all dodgy agents are being found out (34.1%)

Total votes: 220
The voting for this poll has ended on: April 15, 2017
upcoming events
REB Awards
Sydney The Event Centre 12 Sep
REB Awards
Sydney The Event Centre 12 Sep
Melbourne The Event Centre 14 Oct
Brisbane The Event Centre 18 Dec
View all events
Do you have an industry update?