Brisbane’s rental market is shrugging off pressure from increased demand, with rents rising only steadily across the inner city. Latest stats from the Residential Tenancies Authority show rents are still growing, but at a slower rate than last year. The RTA tracks rents for the 21 suburbs around the CBD and shows median rents for a 2 bedroom apartment in the area grew just $5 per week over the past quarter to $385.
That’s up 7% for the past 12 months, but with an increase of 16% recorded in the previous year it appears our market’s now flattened slightly, defying predictions of continued record growth. We know our population’s growing and a quick drive through our city shows very few residential buildings under construction – so where’s the boom? Our own view ‘on the ground’ is that affordability is now cutting in and providing something of a ceiling on rent rises. There’s only so many couples that can afford $480 in rent (the new median for a 2 bed in the CBD and Spring Hill) and despite their creativity with multiplying mattresses, some of the share households max out at 5 people per apartment! While the threshold’s still pushing upwards there’s a definite thinning of enquiry once asking rents reach $500 or thereabouts.
Owner-residents are continuing to move into the city and with some larger CBD buildings converting to short-stay tenancies (often becoming badly run equivalents of small hotels), rental supply is being cut even further. Over the past year the total bonds held for rental properties in the inner city has grown by just 967 properties (or 3%) and in many suburbs there’s actually been a reduction. Less properties, more tenants. So further rent rises will have to come.
Investors still have plenty of cause to celebrate as the median rent for an inner city 2 bedroom apartment has risen 38% ($105/week) over the past 3 years. But clearly the growth rate couldn’t keep up its pace indefinitely.
If you’d like to see what’s happening with median rents in your area go to www.WhatRentMyHome.com.au for free, easy access to rental stats. This is a new site we’ve launched and you don’t need to log your name, email or any other details to get all the info.