Top-end rental market faces tough future as executives opt to leave city
THE days of southerners moving to Queensland to live and work may be over, with the top end of the residential market now under pressure as high-flying jobs disappear from the Brisbane CBD.
A top economist from one of the Big Four banks has warned that Brisbane was facing a 20 per cent commercial vacancy rate in the CBD which has flowed through to the residential market.
Owners of top-end properties have been forced to sell homes or drop rental asking prices as high-flying executives choose to move rather than take a pay cut to remain in Brisbane.
CBA chief economist Michael Workman warned that the disappearance of whitecollar jobs would have a direct impact on the high-end property market.
“The upper end of the labour market, in terms of income levels, most of those people have white-collar well-paid jobs that would be in the city, but I think the vacancy rate in the CBD in central Brisbane is headed toward 20 per cent,” Mr Workman said.
“That is telling you that there has been significant loss of those quite highly-paid jobs and that does affect the property market.
“People in the higher paid jobs would tend to kind of make the decision to move interstate to get another job at the similar level rather than to take a pay cut and stay.”
Jennifer Grainger of SPACE Property Agents said the lack of tenants was affecting “all leasing in all price ranges”.
“There are less people coming here,” she said, with most executive tenants now locals who were between houses – because of renovations or having just sold their own home.
“The rental prices have dropped probably maybe 20 per cent. It’s been huge.”
Ms Grainger said those priced right were renting within four to five weeks.
“If anybody has got overpriced property now is the time to realign pricing. It will be picking up in August, September,” she said.
Pedro Williams of the newly relocated BM Prestige Automotive in Bowen Hills has been to 15 executive rental homes in the past two months. He hopes to secure something for around $1200 a week.
“In Brisbane it’s either you live in an apartment, or a house with five bedrooms. There’s a lack of appropriate properties for younger couples without kids that do want to live in a house,” he said. “Instead of a nice master bedroom suite … you’re having to share the space that’s supposed to be the master with three bedrooms that you will not be using.”
He said Brisbane needed something in the middle of apartments and larger executive houses.
“It’s hard for us to change the quality of the house we have at the moment for something around the city for double the price,” he said.