Brisbane Apartments Fill Up

The latest Urbis Inner Brisbane Apartment Rental Review reported a vacancy rate of 0.6% for the June quarter 2019, the lowest rate recorded by Urbis, tightening by 1 percentage point from the previous quarter.

Urbis Director of Property Economics and Research Paul Riga noted “the Inner Brisbane new apartment market has withstood the influx of new supply over the past 5 years to now register rental growth across parts of the market.”

The Inner Brisbane Apartment Rental Review recorded an annual rental price increase of 3.6% for one-bedroom one-car apartments and 3.3% for two-bedroom, two-car apartments.

Based on discussions with building managers, there has been a significant level of lease renewals and new tenant demand for new apartment buildings, with feedback indicating it is only taking one to two weeks for apartments to lease.

“Whilst the Urbis survey registered its lowest ever vacancy rate of 0.6% this quarter, building managers are aware of the competitive market, with price growth second priority to low vacancy,” Mr Riga said.

The Residential Tenancies Authority (RTA) also recorded rental price increases across one, two and three-bedroom apartments compared to one year ago. The largest increase was three-bedroom apartments at 3.8%, followed by one-bedroom apartments at 2.4%.

Mr Riga said that as well as price increases, the RTA also recorded an increase in bond lodgements. “Brisbane has seen more bonds lodged in the last 12 months than during the peak of apartment settlements in 2016/2017. There were 23,623 bonds lodged in the year to June 2019 within the Inner Brisbane catchment.”

“The rental market is active, with quality apartments – location, design, amenity – registering growth in take-up and weekly rents.”

The Queensland State Government is supportive of the Build to Rent industry, launching a $70 million build to rent pilot project late last year. The program is designed to tackle housing affordability and provide inner city workers with affordable rental options in the areas in which they work.

 “The tightening new apartment vacancy rate is a positive sign for the future growth of the Build to Rent market within Brisbane,” Mr Riga added.

“New rental supply is declining, and tenant demand is increasing. The current rental market conditions are prime for growth, and savvy groups who understand what renters are looking for have the opportunity to benefit.” 

  • 22 apartment projects surveyed equating to 3,366 new and near new apartments.
  • An indicative vacancy rate of 0.6% recorded, the REIQ registered a vacancy rate of 3.3% for all Inner Brisbane rentals.
  • One-bedroom, one-car apartments remain the most popular product based on the average number of rental applications per apartment.
  • Annual rental price increase of 3.6% for one-bedroom one-car apartments and 3.3% for two-bedroom, two-car apartments recorded.
  • Furnished apartments receive a rental premium of 15.5% on average.

 

SOURCE: PAUL RIGA (URBIS - 15/10/2019)