Queensland has gone 21 consecutive quarters with a statewide rental vacancy rate at or below 1 per cent. The last time the state registered a healthy reading was December 2019. The latest September quarter figures from an industry body show that of 50 regional rental markets, only one is rated healthy and only one is rated weak. The other 48 sit in the tight band.
That is a long stretch for a market that is supposed to correct itself. Vacancy rates normally rise when tenants cannot afford more rent or when new supply lands. Neither has happened at scale.
How tight is tight, state by state
The healthy outlier is the Bay Islands off Redland, which includes North Stradbroke, at 3.5 per cent. It is a small, unusual market and it still fell 0.8 of a percentage point over the quarter. The only weak market is Isaac, a mining area, at 6.5 per cent. That reflects local resource-sector conditions more than anything about housing demand across the state.
Everywhere else is tight, and a lot of it is severe. Thirty-four regions recorded 1 per cent or less. Cook had zero vacancies. Charters Towers and Goondiwindi were at 0.1 per cent, Maranoa at 0.2 and Toowoomba at 0.6.
Key numbers
- Brisbane: 1 per cent. Greater Brisbane: 0.8 per cent
- Logan and Moreton Bay: 0.7 per cent. Ipswich and Redland: 0.8 per cent
- Gold Coast: 1.6 per cent. Sunshine Coast: 1.2 per cent. Cairns: 0.8 per cent
- Noosa: 2.5 per cent. Hervey Bay: 2.2 per cent. Maryborough: 1.1 per cent
- Versus June: 21 markets tightened, 15 held steady, 14 loosened
A vacancy rate below 1 per cent usually means a tenant has very few options, and a landlord has very little reason to discount. Even the “looser” south-east markets, Gold Coast and Sunshine Coast, are only a little above that line.
The investor exit problem
The usual way a rental shortage resolves is that more investors buy, more landlords list, and vacancy drifts up. That relief valve is not working well. When investors leave the market, whether through selling, being priced out by higher interest rates, or choosing not to buy at all, each exit removes a rental home from the pool without adding a new one.
Supply and demand do not need to move dramatically to produce a squeeze. If household formation holds up and the number of rental properties grows slowly or shrinks, vacancy stays pinned. Rental supply that arrives through new construction is slow, and as we have covered elsewhere, the supply pipeline looks thin. That makes the investor-exit story and the vacancy story the same story seen from two ends.
We do not have figures here on how many investors have actually left Queensland, so treat that link as mechanism rather than measured fact. What the vacancy data does show is the outcome: no relief, 21 quarters running.
What this implies for rents and yields
Tight vacancy supports rent growth. Where tenants have little choice, landlords can hold or lift asking rents, and tenants tend to stay put and absorb increases. That keeps gross yields supported even where capital values are soft.
There is a limit. Tenants cannot pay more indefinitely. Incomes, not just supply, set the ceiling. When affordability bites hard enough, people double up, move in with family, or leave the state. That can pull vacancy up without any new housing being built, which is a slower and uglier route to balance. It is worth reading alongside our guide to rents, vacancy and tenants.
It also raises a policy catch. Measures aimed at landlords can tighten things further if they push more owners out. The debate over landlord licensing in Victoria and its supply risk is one example of the same trade-off.
Scenarios from here
- Base case: vacancy stays at or near 1 per cent statewide. Rent growth continues but slows in the markets where affordability is most stretched.
- Upside for tenants: a wave of completions or a pickup in investor purchasing nudges a handful of south-east markets above 1.5 per cent. The Gold Coast and Noosa are the likeliest candidates.
- Downside for tenants: further investor selling or planning delays keep supply flat while population keeps growing. Markets already at 0.7 or 0.8 per cent tighten further.
The 14 markets that loosened from June are worth watching. If that count grows over the next two quarters, it may be an early sign that the squeeze is peaking. For now, 21 tightening against 14 loosening says it has not turned.
If you are an investor weighing a Queensland rental, the practical step is to check the vacancy rate for the specific postcode, not the state average, and stress-test your cashflow for a flat rent scenario rather than assuming continued rises. Subscribe to the newsletter for the weekly signal.
General info, not financial advice.
