Regional Queensland hopeful for a rental recovery

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Areas in regional Queensland are hoping infrastructure investment announced in the recent state budget will help their rental markets improve following the downturn in the resource sector.

Rental vacancy figures released recently from the Real Estate Institute of Queensland (REIQ) show that a number of regional centres are still experiencing high vacancy rates, though some centres are showing signs of a recovery underway.

“We can see those towns, where employment rates are stronger and opportunities are greater, that the rental market is recovering more quickly,” REIQ chief executive officer Antonia Mercorella said.

“The State Government has announced a range of regional infrastructure projects in its recent budget and these will doubtless impact on the vacancy rates in the coming quarters,” she said.

Mackay is one location where improvement is being seen, with the coastal centre’s vacancy rate down by 0.3% to 9.1% over the June quarter.

Mercorella said incentives being offered by landlords and agents have helped Mackay’s recovery as an oversupply of dwellings is slowly absorbed.

Townsville has seen a similar level of recovery, with a 0.6 decrease over the June Quarter to 5.3% after a spike at the end of March.

There could be more improvement for Townsville in the near future, with its unemployment levels hopefully reduced as government spending kicks in.

“Unemployment still a major issue for the region, however, with a new school being announced in the budget and the continued stabilising presence of government employers such as the Defence Force, Townsville seems to be headed in the right direction,”  Mercorella said.

Toowoomba also saw a small decrease, with a quarterly drop of 0.1% drop to 3.1%.

On the other side of the coin, Bundaberg recorded its highest vacancy rate since March 2009 as it increased by 0.5% to 4.6% over the quarter, but there is some optimism for the region.

“The State Government’s Budget measures targeting Bundaberg and the Wide Bay region will bring a welcome boost to this market, creating jobs and stability for the region,” Mrecorella said

“More than $660 million has been allocated to projects throughout this region, encompassing Bundaberg, Fraser Coast, Kingaroy, Nanango and Gympie and will boost the gas pipeline, hospital and emergency services.”

There is less positivity surrounding Rockhampton where the vacancy rate has increased to 6%, with no decrease expected in the near future.

The mining slowdown has seen an increase in Gladstone’s vacancy rate as tenants leave the area, however building in the region has also fallen off which is expected to help the current over supply level to fall.

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