The home at 14 Perkins St West, Railway Estate, is for lease for $520 per week in the Townsville region, where the vacancy rate is 1 per cent. Picture: realestate.com.au

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The Townsville rental market remains tight as new data reveals dangerously low vacancy rates across Queensland with only one rental market in the state deemed healthy.

The Real Estate Institute of Queensland (REIQ) Residential Vacancy Report for the March 2024 quarter said vacancy rates were as low as 0 per cent in Queensland, with rental availability remaining dangerously low across much of the state.

In Townsville, the vacancy rate was sitting at 1 per cent in the first quarter of 2024.

This was unchanged from the December 2023 quarter but up from the September and June quarters, when the vacancy rate dipped to 0.8 and 0.9 per cent respectively.

The vacancy rate was at its lowest in the June and September quarters of 2022 and had not risen above 1 per cent since June 2020, when it dropped to 1.7 per cent from 2.9 per cent in the previous quarter.

150 Mosman St, Charters Towers, for lease for $450 per week, is one of just eight Charters Towers properties listed for rent on realestate.com.au Picture: realestate.com.au

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The overall state vacancy rate was at 0.9 per cent in March.

In areas of Charters Towers and Cook, the percentage of rental properties available to lease was sitting at just 0.1 per cent.

While in Goondiwindi the vacancy rate was 0 per cent.

At the opposite end of the spectrum was Mount Isa (3.4%), which was the only area to land within the 2.6-3.5 per cent range considered “healthy” by REIQ.

Of the 50 local government areas and sub regions covered in the report, more than half were in extremely tight territory, hovering at 1 per cent or below.

Vacancy rates fell in 22 of the areas, were stable in 10 and climbed in 18, compared to the previous quarter.

The report said the changes did not, however, represent any meaningful difference, with movement confined to a modest 0.2 per cent in most cases.

REIQ CEO Antonia Mercorella.

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REIQ CEO Antonia Mercorella said Queensland’s rental market was not in a healthy state and faced a long road to recovery.

“Another quarter and it’s sadly the same old story of seriously scant rental availability right across Queensland,” she said.

“Property Managers are still overwhelmed by the volumes of applications and the inability to give every applicant a property, no matter how perfect a tenant they would make.”

McGrath Estate Agents Townsville principal, Kaye Matheson said Townsville was experiencing one of the tightest rental markets she had seen in 30 years of working in real estate.

“In the last month we had 671 enquiries on 10 properties … and 23.2 per cent of enquiries were from outside of Townsville,” she said.

“So tenants are competing with people trying to move to town, as well as locals.”

The home at 20 Ashmore Cres, Burdell, is for lease for $680 per week in the Townsville region, where the vacancy rate is 1 per cent. Picture: realestate.com.au

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Ms Matheson said the rental market would likely only get tougher for tenants.

“We have all these troops coming to Townsville and nowhere really for them to go,” she said.

“And as the market is increasing in value, people who used to be able to afford a four-bedroom home may now only be able to afford a three-bedroom home.”

Ms Matheson said low-income earners and first-time tenants were the worst hit, while a lack of new housing being built was negatively impacting the rental pool.

“The most important thing for tenants at the moment is to have a record as clean as can be,” she said.

“For the next three properties their rental history will follow them, so they need to make sure they’re not in arrears, they clean their property at the end of their lease and get their bond back.

“They also need to inspect the property and get their applications in as soon as they can.”

Kaye Matheson, Principal of McGrath Estate Agents – Townsville

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Ms Mercorella called on the Government to “step up” in the form of social housing and rental assistance to keep the most vulnerable people in communities housed.

“At the same time, the longer-term solutions including a concerted effort towards improving productivity and affordability of the construction of new dwellings are essential to fixing this supply issue,” she said.

“While we agree that build-to-rent initiatives could also be an important piece of the puzzle to boosting supply, we don’t see it being the ‘silver bullet’, and the rental market will still heavily rely on everyday citizen investors choosing to rent out their properties.

“Our view is the incentives given to institutional investors should be extended to private investors, acknowledging the crucial role they play in housing Queenslanders and encouraging them to continue to do so.”

RENTAL VACANCY RATES MARCH 2024

Queensland – 0.9%

Greater Brisbane – 0.9%

Gold Coast – 1%

Sunshine Cost – 1.1%

Toowoomba – 0.8%

Goondiwindi – 0%

Bundaberg – 0.9%

Mackay – 0.6%

Rockhampton – 0.7%

Townsville – 1%

Cairns – 0.7%

Charters Towers – 0.1%

Cook – 0.1%