Why Brisbane is in a rental crisis, will rents keep increasing, and what you can do about it.
Brisbane is currently in the grips of a rental crisis.
There are 35% fewer properties on the market than average over the past 5 years.
The national rental vacancy rate is at a record low of 1.1%
Desperate tenants are offering up to 12 months in advance to secure properties.
Since August, rents have increased by a whopping 20%.
The crisis is showing no signs of easing with both supply and demand sides of the equation being pinched.
The national migration cap has been increased from 165,000 immigrants to 195,000. Over 2 million applications have been processed since June.
These new immigrants will join the 50,000 Australians who moved to Brisbane over COVID and the estimated 200,000 Australians set to move here over the next 5 years.
Demand for rental properties has never been higher and it is only set to increase over the next 5 years.
On the supply side, investment lending fell by 5% in August and is down 6% over the past 12 months. Fewer investors mean fewer rental properties.
Added to this, the borrowing capacity for home buyers is reducing.
A family with 2 kids on a combined salary of $200k per annum has seen their borrowing capacity drop by over to $277k over the past 6 months.
These buyers are still in the market however they are now in the same part of the market as First Home Buyers stabilising pricing and pushing demand and competition at the entry-level end of the market.
Interest rate increases are having a material effect on the borrowing capacity of First Home Buyers meaning that many who have diverted their decision to buy a home are finding that they no longer have the capacity to purchase which is further driving up demand in the rental market.
This truly is a rental crisis and it’s showing no sign of easing.
So how do you avoid becoming a casualty of crisis?
- Move back in with mum and dad
- Own your own home and never have to worry about renting again
Click here to book a call to get started on your home ownership with a low deposit.
