Hot property: Mackay's rental market is getting tighter

RENTAL homes in Mackay are being snapped up after just days on the market, as agents are inundated with dozens of eager renters attending every inspection

Mackay Real Estate Feature - Looking south west towards hospital and Pioneer River. Picture: Tony Martin

RENTAL homes in Mackay are being snapped up after just days on the market, with agents inundated with dozens of eager renters attending every inspection... and the competition is only getting hotter.

With an estimated 13,040 rental properties in the greater Mackay region, there are only 240 rental properties on the market, Real Estate Institute of Queensland data shows, with the current rental vacancy rate about 1.8 per cent.

Gardian Real Estate director Ben Kerrisk said demand had increased dramatically since late last year, with 120 potential tenants attending inspections for 15 available rental properties last week alone.

"We've been keeping a record of how things were going the past few months, vacancy rates hover around 1-2 per cent,” Mr Kerrisk said.

"Mackay at one stage two or three years ago was at nine per cent vacancy.

"There is an increase in inquiries and therefore an increase in potential tenants who are viewing. This is leading to multiple applications at some properties.”

Mr Kerrisk put Mackay's tightening rental market down to a number of reasons, including an improving sellers' market and an increase in population due to major infrastructure like the Mackay Ring Road and an upturn in the mining industry.

"It is all positive, everything that is coming out of the rental market,” he said.

RE/MAX business development manager Emma Goodfellow also attributed market strength to the Ring Road project and a strong resource sector, but said an influx of new staff at the hospital was another driver for low vacancy rates in the region.

She said the market had been "very busy” with rental vacancies tending to last one to two weeks at most.

"Since November it has just got busier, I've talked to a few applicants and it is a lot of new people moving to town,” Ms Goodfellow said.

"Our office is at 0.6 per cent vacancy and we are seeing increases in rent at an average of $40 a week.”

Mr Kerrisk said renters were particularly facing a challenge securing "middle-of-the-road” properties, as these were few and far between at the moment.

Middle-of-the-road homes are well-sized properties priced between $350 to $450 per week.

"It seems to be there are properties on opposite ends - the ones that are smaller on the more affordable end and the other ones on the high end,” he said.

Houses at the top end of the market do eventually get rented but "take a little longer” as fewer people are willing or able to pay the higher prices, Mr Kerrisk said.

On the other end of the spectrum, he said, a small amount of renters desperate to secure properties had offered to pay higher rent to stand out from other applicants.

Because of this same demand, he said landlords now had the luxury of not taking the first application that comes in. In previous years, Mr Kerrisk said, renters could bargain with landlords bringing down prices dramatically, but this was no longer the case.

"There is little to no discount, we are seeing it less and less,” he said.

Those unable to find suitable homes within their budget are being forced to "compromise”, Mr Kerrisk said.

"They are most of the time taking a property that does not suit them just to find a home.”

Elders Real Estate principal Sally Richards said one factor playing havoc on the local market was home foreclosures.

Ms Richards said home owners who were unable to continue mortgage repayments during the downturn joined the pool of renters once their homes were reclaimed by the banks.

Also noticing a jump in the rental market, Ms Richards said people had expressed to her how difficult they were finding it to secure a rental.

Blacks Real Estate director Peter Francis said as infrastructure and industry continued to boost population - including the potential $20 million Qantas pilot academy - the tension on the rental market would eventually have a "flow-on effect” in the construction industry.

"We will run out of houses and people will start building again,” Mr Francis said. "Land sales are increasing and people are building homes.”

Mr Kerrisk mirrored this, saying if the rental market continued to tighten "people who miss out start to go and buy a property instead”.

"But it's not panic stations,” he said. "You can get a house, you just need to impress the property manager. It's not impossible.”

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Originally published as Hot property: Mackay's rental market is getting tighter