Toowoomba rental market under pressure as lack of supply sends rent through the roof

Three years ago, 378 dwellings were available to rent in Toowoomba, but now its just 81, and asking rents could rise by more than $5000 this year.

Toowoomba’s rental crisis could push the rental asking price up by more than $5000 this year as the Garden City records the second lowest volume of vacant properties in 17 years.

With a population of 171,000 housed in 66,000 dwellings, an estimated 22,000 of those make up Toowoomba’s total rental pool, according to property research firm Propertyology.

Analysis of the city’s rental market has found just 81 dwellings are currently being advertised for rent, down from 378 this time three years ago.

“In the 17-year history of rent records, this is the second lowest volume of vacant properties ever,” Propertyology head of research Simon Pressley said.

“The lowest was 60 dwellings in May 2010, but Toowoomba now has 16,000 more people living there than in 2010.”

The current advertised rent for a three-bedroom house is $392 per week, up $70 per week from three years ago, a hike of $3500 per year.

Mr Pressley said that figure could go as high as $5000 extra per year in 2022.

“In Toowoomba and many other wonderful regional locations, there is currently a lot to be positive about,” Mr Pressley said.

“The economy is strong, the pipeline of major projects is exciting, the volume of new jobs advertised is significant, wages look set to finally increase meaningfully, and homeowners have increased equity.

“Arguably the biggest challenge is the lack of rental accommodation. Whether someone from out of town wanting to move to Toowoomba, or a business owner trying to attract skilled labour, or an existing Toowoomba resident who is seeking alternative rental accommodation, there is very little available.”

Propertyology head of market research Simon Pressley.

Mr Pressley said the problem was rental supply which was holding Toowoomba back from realising its full potential.

“A tenant looking to move homes at any stage over the next few years needs to brace themselves for paying a lot more than last year,” he said.

“It’s common practice now for half a dozen tenants to be competing for the same rental property, like seagulls fighting over a chip. That competition could push the rental asking price $5000 higher in 2022 than 2021.

“There’s no end in sight for this intense upward pressure. Rental accommodation will never go out of fashion. Private investors have always funded the bulk of it, close to 90 per cent of all rental supply. Until such time as there’s a big lift in participation rates of property investors the rental crisis will get worse.”