Ipswich rental market: Why it is so difficult to find vacant properties, why rents are going up

It is a nightmare trying to find somewhere to rent in the fastest growing part of Queensland with rental prices only expected to keep rising.

Ipswich real estate agents say the local rental market is in crisis and is not showing any signs of easing.

IPSWICH’S rental crisis is not showing any signs of easing despite investors returning to the fastest growing city in Queensland in recent months, with one local real estate agency rocked by stories of people unable to find accommodation turning to living in their cars or in tents.

The Real Estate Institute of Queensland is set to release its latest statewide figures in the middle of June but the rental vacancy for Greater Brisbane is currently hovering around one per cent.

Investors selling up during Covid-19 and an increase in owner occupiers and first home buyers moving into the local market has heaped the pressure on the rental system, only exacerbated by a rise in people moving to the city from Brisbane and interstate.

Ray White Ipswich business development manager Taylah Sherrin.

Ray White Ipswich business development manager Taylah Sherrin said the city was experiencing an “extreme” rental shortage which started at the height of the pandemic.

Ipswich’s largest real estate firm currently has a 0.1 per cent vacancy rate for its rental properties with any available houses being snapped up.

Inquiries are pouring in as soon as new homes are listed.

“Basically the city just does not have enough available rental properties out there,” she said.

“We have quite a large rent roll. We are quite a big office in Ipswich. For us to not have a lot out there is a big thing.

“I think our average days on market is about 11 or 12 days. Everything is moving pretty quickly.

“When the demand is high for properties that tends to push the price up. From what we’ve witnessed as an office, rents have increased about five per cent.

“Obviously this is good if you’re a property owner but not so good if you’re a tenant. It’s quite hard for them. We do our very best to try and accommodate for everyone. We have a lot of systems in place to try and help people look for properties and give them updates as often as we can.

“It’s absolutely crazy at the moment. There’s no other way to describe it.”

Ms Sherrin said on average the firm was receiving between 20 and 25 applications for every house which became available.

“There’s a lot of competition,” she said.

“When our leasing agents are doing their inspections at the home, there’s often a lot of people at the home.

“Tenants are saying that to us as well. They’re noticing how many people are out there.”

Auctioneer Paul Wright with Real Estate Agent Luis Garza during a virtual auction.

Ms Sherrin said when Covid-19 was in full swing last year, the firm noticed a “dramatic drop” in the number of investors buying in Ipswich.

Those investors also began selling off their properties.

She said there was a noticeable increase in people who had moved from interstate and from Brisbane.

The Ipswich local government area is the fastest growing area in Queensland with its population of 240,000 expected to more than to double to 557,000 by 2041.

“A lot of our rent roll was being sold,” she said.

“We lost of a lot of stock.

“It was mostly an owner-occupier market.”

Ipswich Real Estate principal Dylan Ansems said his firm had no rental properties free at the moment.

A recently available house at One Mile received 130 inquiries in a week with 25 groups of people going to the first viewing.

“We’ve got one available in about three weeks,” he said.

“Next month after that there is pretty much nothing. There’s no turnover, no one is leaving.

“We’ve got three on our website now. Two of those have got approved applications and we’re just waiting for them get signed.”

Mr Ansems said he had never seen the Ipswich rental market as tight as it is right now.

“Ever since we got out of lockdown the first time last year (is when it started),” he said.

“We run a tight ship so we’re always low vacancy, usually under two per cent. Over the last year we’ve usually been at one per cent but always got something available.”

Ipswich Real Estate principal Dylan Ansems.

The local rental market had been “flat” for the past 15 years but it was finally seeing some growth, Mr Ansems said.

“We’re also one of the most affordable places in the country for lifestyle and affordability,” he said.

“Ipswich has been on the radar anyway. There are not many places in the country where you can rent a four-bedroom home for under $400 a week which is less than an hour to the capital city.

“It’s going to have to force prices. Prices are changing a little bit. We’re seeing an average increase of $15-25 on homes (a week) even in just the last three months.

“It’s a bit of a perfect storm I guess for Ipswich property.”

Mr Ansems said staff have had to “desensitise themselves” from the stories they’ve heard over the past year.

“They’re hearing stories of people living in their cars and caravans or tents or wherever they can,” he said.

“There’s a lot of couch surfing going on. A lot of stressed people out there for sure. It is getting sad to be honest. It’s getting to us a little bit.

“There’s no real short-term solution. Unless they start building a lot of houses.”

Both Ms Sherrin and Mr Ansems agreed it didn’t look like this trend was going to turn around anytime soon, despite investors starting to return.

“Lately within the last two months … they’ve kind of popped up back up in the market and seem to be a bit more active than what they were,” Ms Sherrin said.

“At the end of the day the more investors we have buying in our marketplace the more properties that we have for prospective tenants.

“If I’ve learnt anything throughout this period it would be the market is extremely unpredictable. The way things have been going I don’t really see any signs of things slowing down. That demand for properties is still growing. There’s still a huge amount of people out there that are looking.”

Real Estate Institute of Queensland CEO Antonia Mercorella.

Mr Ansems said people were regularly offering to pay 12 months of rent upfront or offering extra money on top of what was advertised.

“We don’t encourage it,” he said.

“We base it on good applications.

“Sometimes they throw it at you nearly.

“Investors are definitely coming back and they’re taking up a lot of the new ones lately. If the demand keeps going rent has just to go up.”

REIQ CEO Antonia Mercorella said Covid-19 had “shone a light” on some of the “most liveable” parts of Australia outside the capital cities.

“It’s my prediction that we will see this trend continuing due to our relative affordability compared to the southern states, our high liveability factor and the impact that the pandemic has had in terms of people seeking better lifestyle opportunities,” she said.

“A desire to be away from the metropolitan areas during a pandemic may have caused an influx in regional Queensland.

“The pandemic didn’t just popularise flexible working arrangements, it also allowed people to assess their priorities and, for many, the wide open spaces and proximity to some of Queensland’s favourite attractions brought them to the regions.

“Record-low interest rates, government support and stimulus measures, and the pandemic-driven stampede we’ve witnessed migrating beyond our southern borders have sent Brisbane’s private rental market into uncharted territory, pushing vacancy rates down to their lowest levels since October 2012.”

Read more stories by Lachlan McIvor here.

Originally published as Ipswich rental market: Why it is so difficult to find vacant properties, why rents are going up