This piece discussing the current renal market has been released from REIQ in response to the latest rental trends and the new residential tenancies legislation that came into effect on the 1st of July.
Low interest rates and thousands of renters becoming first home buyers have helped rents to stabilise or ease slightly over the June quarter, according to the Real Estate Institute of Queensland (REIQ).
The latest median rents from the Residential Tenancies Authority have found that rents across the State have held relatively steady over the past quarter.
These new figures also come at a time when lessors, agents and tenants are adjusting to new residential tenancies legislation that came into effect on 1 July.
REIQ managing director Dan Molloy said the low interest rate environment and the First Home Owner Boost had allowed thousands of renters to get a start in the property market.
“Thousands of Queenslanders have taken advantage of historically low interest rates and the raft of government first home buyer incentives to move out of the rental market into their own home,” he said.
“This has alleviated some of the pent-up demand that has been burdening Queensland’s rental market for more than four years, which put upward pressure on rents.”
REIQ rental vacancy rates show demand has eased in many areas across the state however with vacancy rates of 1.9 per cent, 0.9 per cent and 2.5 per cent respectively, Brisbane, Toowoomba and Mackay are still affected by more demand than supply.
“While rents are steady, gross rental yields of more than 5 per cent are being achieved in many cases,” Mr Molloy said.
“Compared to other investment vehicles, investment property is really holding its own with solid yields, the possibility of good capital growth, and lower financing costs making entry into the market more affordable.”
Mr Molloy said the easing of the rental market reinforced the REIQ’s position during the development of the new Residential Tenancies & Rooming Accommodation Act, which came into effect on 1 July.
“The new legislation was developed during a period of historically low vacancy rates, however, it has always been the REIQ’s position that the legislation needed to work in all market conditions,” he said.
“The typical notice to vacate period is now up to two-months for owners and remains at 14-days for tenants.
“To be fair to all parties regardless of market conditions at any point in time, the REIQ’s position has always been for this notice period to be equalised.”
While population growth is likely to underpin the rental market into the future, it is important that people are not deterred from investing in property due to over-regulation.
“Residential property investors have contributed significantly to the economic prosperity of Queensland,” Mr Molloy said.
“It is imperative that their contribution is not diluted by over-regulation which may result in an imbalance between the rights of the owner and the tenant.”