QLD Brisbane oversupply?

Oversupply of dwellings for Brisbane in next two years: SQM Research

There's probably been a bunch of threads on this (and the above article is fairly vague), but I wanted to get peoples' opinion on whether new apartment / TH oversupply could affect CG of free standing houses.

Have there been any precedents in recent history / examples?

And what might the effect on rents be, in your opinion?

 

The city where landlords will pay your removalist costs

 

TBH I dont think unit oversupply will cause the free standing homes too much worry. Its a parrallel market much like the oversupply of units in Melbourne. Houses still skyrocket through the roof.

Regarding the rentals - I'm sceptical about people finding it hard to rent free standing homes. Dont believe everything in those articles.

Like I said I've never even been 2 weeks without rent in Brisbane/Logan in any of my investments. Heck some of them rented out before settlement day so the tenant moved straight in on the day the house settled. In fact 3 of my investments have just re-signed another 12 month lease after I increased the rent on them.

Not worried a single bit about this.

 

You should be not all areas of Logan are great for rentals ...some are having real issues...

 

What particular areas? My business partners have also moved alot of their portfolio up there so I've been paying attention from Boronia Heights all the way across towards Eagleby and Beenleigh and they seem decent. My business partner actually bought a complete complex of 6 townhouses in Beenleigh - rented all of them within a month although 3 were already leased.

The only suburb is Kingston that seems to take a little longer to rent. But even then agents I've been talking to are saying that is not a problem these days.

I've been researching the area quite significantly over the last 12 months and I've probably looked at all the suburbs there. Some are not as good as others but never heard about not being able to lease a house. Longest story I've heard is 8 weeks but thats because it has significant damage.

 

Up to you......markets are fickle.....these days I tend to stick to more middle class suburbs.

 

Where does the price range start for "middle class suburbs" ?

 

450K-550K IMO

 

I've a property in wavell heights I had to drop rent by 50 bucks. Still not rented.

 

Well that's nowhere near Logan. And that's a quite good area - much much better area than Logan suburbs. If I was you I'd be getting a new agent or several agents listing the same house.

I've used this tactic one and guess what? within 1 week the initial agent miraculously found a tenant for me. Might not be in your case but this is a business so you need to be hard line as well sometimes.

Man I just checked Wavell Heights have a 1.6% rental vacancy rate currently. WTF is your agent doing? Go get a new agent LOL

 

Hmm, all 3 of my Brisbane properties have seen rental increases over the last 6 months.

 

Another source is telling me 3.2% vacancy and another source is telling me 3.6% (not sure how accurate these sources are but all of them lowest 1.6 highest 3.6%) - Not anywhere near the percentage whereby you should be finding it hard to rent out.

Either way its still very low. Alot lower than some Logan suburbs and I'm not having trouble renting any of them.

1) Your agent either sucks big time
2) Your asking for too much in the first place
3) Your house condition is not inline with your asking price.

 

I thought the article was about Brisbane.

You may be right. My point was that my existing tenant was paying 50 dollars more than I can now list my property due to what is currently on the market. 2 months ago I could have listed it for the same rent. But the market changed swiftly. It could just be bad timing, who knows.

 

I think first step is finding a new and multiple agents to list your property. What I found is some agents are very very lazy. If you are not proactive and follow up basically every single day they will not do anything.

If your property doesn't lease they don't care. That is why I don't mind paying extra sometimes in agent fees for a good and reliable agent. Not saying your agent is not pulling their weight but in your instance I would definitely be starting to flex some of my muscles and talk to other agents in the area.

At the end of the day this is a business. Your in it to make money. Like I say always no-one cares for your circumstances more than yourself.

 

Yep you have a lot of supply there at Chermside next door, which is probably having an effect. I have a place in Chermside and the tenants are vacating next month. Agent reckons there will be a pick up in the rental market through June and July so hopefully won't be an issue for me.

 

me thinks the inner city older walk up apartment that doesn't have a lift would in more pain. why would live in those when you can rent new secure apartment with lift and gym? units in greenslopes, moorooka, annerley comes to mind

 

Oh do tell.....let us know what you experience those markets are?

 

So the consensus is that oversupply of units in BNE should not affect free-standing houses...neither price wise nor rent wise?

 

I've been a sales agent now for a couple of months on the North Side of Brisbane. The market has changed. Rents are dropping and prices are dropping and it's only happened in the last 6 weeks. Our rental days on market have increased by 25% from a year ago. Our open home buyer traffic have dropped off too, we are just not seeing the numbers so it's hard to get price feedback. The banks are making it hard for people to get loans and a lot of the interest only loans are coming up to expire and people can't extend them.

So when you combine winter, lack of money supply, dropping rental yeilds and difficulty re financing, as well as uncertainty in the economy, we're probably going to see a buyers market develop over the next few months.

 

1. Two different products. People have preferences for one over the other. These preferences don't diminish easily.
2. Oversupply is overhyped, causing flow on effects.