The Australian Rental Market: Changes and Future Outlook

Over the past three years, the rental markets in Brisbane and the Gold Coast have experienced two extremes. As the pandemic worsened in 2020 and the first half of 2021, global travel restrictions dealt a heavy blow to the short-term rental markets in Brisbane and the Gold Coast, with business travellers and tourists disappearing altogether. This pushed a large volume of short-term rental properties into the long-term rental market, while demand for long-term rentals also declined — for instance, international students, a key driver of the long-term market, were unable to arrive, and people who lost their jobs due to the pandemic chose to share housing with friends or family to cut their rental costs. As a result, the supply-and-demand balance in the long-term rental market was disrupted, and rents for CBD apartments in particular fell to varying degrees.

However, in the second half of 2021 the situation reversed. With the borders reopening, business travellers and tourists gradually returned, and short-term rental properties that had temporarily switched to long-term leases moved back to the short-term market where their lease terms allowed, at one point making properties extremely hard to come by. The return of international students also created a shortage of properties in the long-term rental market. With demand outstripping supply, long-term rents rose to varying degrees, generally by 10%–30%. At present, new development projects in the Brisbane and Gold Coast property markets are very limited, yet migration demand is rising rapidly, particularly the number of migrants from China. It is foreseeable that over the next five years Brisbane and the Gold Coast will face a shortage of properties, with very positive expectations for both rents and property prices.