Perks are back as Qld landlords attempt to lock in long leases
Two weeks free rent? Landlords have begun offering a range “perks” in what could be the first sign that Qld’s rental hunger games is easing. See what’s on offer.
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Landlords and developers are offering everything from free rent to internet, garden and pool maintenance in a bid to secure long term leases, one month after legislation was introduced to limit rent increases to once a year.
In what could be the first sign that Queensland’s rental hunger games are finally easing, rental listings have begun popping up offering incentives for tenants willing to sign 12 month leases, offering renters tenants some certainty after years of insecurity.
But the reasons behind the “perks” has divided the experts, with everything from rental reforms and longer list periods to more supply in some markets due to new stock and tenants switching back to share houses to cope with affordability concerns among the reasons suggested.
“We’re finding properties advertised for over $700 are sitting a little bit, while anything under that is snapped up,” Cassandra Protheroe of Havig & Jackson, who has a Clayfield rental listed gor $750 a week with one week free rent, said.
“We’re seeing an increase in share houses, so people are sharing costs.
“(Offering a week’s free rent) makes the property a bit more appealing to those who are struggling.”
On the Sunshine Coast, Henzells Agent general manager Katherine Allan said time on market “has blown out” in places like Caloundra, where new rentals at more affordable prices have entered the market in new estates.
“It is the higher priced ones that are sitting on the market longer and it is about educating the landlords because if the price is right, it will rent,” she said, adding that it was also possible that renters wallets had tipped over the point for affordability.
Ray White AKG principal Avi Khan, whose group has over 2400 rental properties on its books, said properties were taking longer to fill, with his group already seeing rents stabilising.
He added that they were also seeing an increase in the number of tenants applying for a single property, in direct contrast to the shrinking numbers seen during Covid-19.
“We are now seeing 3-4 people on each application,” he said. “During Covid, it was one or two.
“Landlords are having to get creative because rates are so much higher now and they don’t want a property sitting vacant.
“So we are advising them to seek longer term tenancies, as they can only increase rent once a year now (since July 1).”
Among the “perks” found on realestate.om.au was a one-bedroom apartment listed for $730 a week in Kangaroo Point that is being offered with two weeks free rent if the tenant agrees to a 12 month lease.
Also offering two weeks free rent is the owner of a large house at Roma which is listed for $400 a week.
A townhouse at Raceview was listed for $435 a week with one week free rent and one month free internet included, while a studio apartment at Coopers Plains was listed for $370 a week with one weeks free rent and electricity, internet, water, cleaning and gardening of common areas included in that cost.
Rentals in Hendra, Clayfield, Logan Reserve and on the Gold Coast and Sunshine Coast were also tempting tenants with a week of free rent, while free internet was included in the rent for a three-bedroom apartment listed in East Brisbane and lawn mowing and gardening was included for a $475 a week house at Mount Gravatt East.
Real Estate Institute of Queensland Antonia Mercorella said she was surprised that incentives were already being used in the market, even if it was softening.
But she added that a property sitting vacant was not in the interest of the owner either.
“I think the market is definitely changing,” she said.
“The last time we saw incentives being advertised in Brisbane was when we had a glut of apartments on the market and owners were offering everything from free rent to gift cards.”
That was around five years ago.
But it is not just high-end rentals that are listing perks, with townhouses in Raceview also offering two weeks free rent.
Lisa Neale from The Onsite Manager said the incentive was being offered by the developer of the brand new complex.
“I saw incentives like this a few years ago but this is the first brand new complex we have had in 2-3 years so I can’t really comment on why they are offering it other than to get tenants inq uickly,” she said.
“But it is working. We are already getting applications.”
A recent report by PropTrack revealed that conditions appeared to be easing in parts of regional Queensland after extremely tight vacancies since mid-2020, with rents in some locations flatlining or declining.
The report also found that new listings were up 8.3 per cent year-on-year in Brisbane – offering some sign of market pressure easing – but that number was still 10.5 per cent lower than the capital’s five-year average.
The city’s vacancy rate was still “extremely tight” at 1.1 per cent, but that’s an improvement on the 0.6 per cent recorded in June last year.
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“Ideally what any investor wants is a good tenant who pays on time and looks after the asset,” Ms Mercorella said.
“What they don’t want is the government changing the laws with no consultation … they (investors) need to be able to budget for what is ahead.
“Mortgage repayments and costs have increased more than rents, but the idea that landlords are just jacking up rents is just not true … it is not cheap to just re-list a property.
“If incentives are happening, I would say we are now seeing a bit of a reset.”
But Ms Mercorella warned that the more affordable end of the market remained challenged.
Tenants Queensland CEO Penny Carr said historically six month tenancies were more common.
“The government is consulting on changes that were introduced, on whether the 12-monthly rent increase should be attached to the tenant or the property,” she said.
“At the moment, you can still increase rents more than once a year, just not for the same tenant.”
Recent analysis by Suburbtrends found that Queensland was the most “rent stressed” state in Australia.
Queensland had nine of the nation’s top 25 most stressed rental suburbs, including Stanthorpe (91), Warwick (87), Chermside (85), Beaudesert, Boonah, Upper Coomera North and Southport North (85), Walkervale/Avenell Heights and Beenleigh (84).
However, the latest REIQ Vacancy Rates report said consecutive lifts in the state’s quarterly vacancy rate was a promising sign.
Most improvements were limited to a slight lift of 0.1-0.2 per cent, which was the case across Greater Brisbane, including Brisbane LGA (1.0%), Ipswich (1.1%), Logan (1.0%) and Moreton Bay (0.9%).
The Redland Bay Islands recorded its highest-ever vacancy rate of 6.3 per cent.
The tourism centres also improved, including the Sunshine Coast (1.6%) and Noosa (3.1%), the Gold Coast (1.2%), Hervey Bay (1.3%), Fraser Coast (1.1%) and Whitsundays (1.1%).
Improvements were also recorded in Bundaberg at 1.1 per cent, its highest vacancy rate since the pandemic hit, Cairns (0.9%) and Mount Isa (2.7%).
Vacancy rates dipped slightly in Townsville (0.9%) and Mackay (0.8%), and remain tight in Cook and Goondwindi (0.1%), and the Southern Downs (0.2%).
Queensland Council of Social Services chief executive Aimee McVeigh said any sign that the market was improving was welcome, but added that it was “still tough out there”.
“While we have some healthier pockets, they are the outliers with so much of the state still very tight,” she said.
“We are generally still seeing rent prices rising, and 12 months leases? I don’t know what is behind that.
“It is really positive that some landlords are now offering longer leases as they offer more certainty and security to tenants.”
But Ms McVeigh warned that the ongoing housing crisis had shown just how volatile the market was to tough times.
She said that while the yearly cap on rent increases was a “shuffle forward”, she did not expect it would have a significant impact.
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