Queensland’s rental market posted a split decision over the June quarter: 27 regions recorded higher vacancy rates, 13 tightened further, and 10 sat flat. Statewide, the vacancy rate holds at 1%, according to the latest REIQ data. That headline figure masks sharp regional divergence, with two markets now classified as weak (vacancy above 3.6%) while 29 regions still register 1% or lower, meaning tenants face near-zero choice and landlords maintain pricing power.
The Fraser Coast and Hervey Bay both jumped 0.7 percentage points to 2.2% and 2.3% respectively, the largest quarterly increases. Gympie hit 1.4%, its highest level in almost a decade. The Gold Coast moved from 1.1% to 1.5%, and the Sunshine Coast inched from 0.7% to 0.9%. Caloundra Coast, Burdekin, Mareeba and Maryborough all recorded 0.4 to 0.6 percentage point rises. At the other end, Cook and Goondwindi sit at effectively zero vacancy, and Redcliffe (0.5%) and Pine Rivers (0.6%) remain the tightest markets in Greater Brisbane. Brisbane LGA held at 1%, unchanged from the March quarter.
Where the loosening happened and why
The Fraser Coast cluster stands out: vacancy rates there now approach the bottom of a healthy band (2.6% to 3.5%). Local property managers attribute the shift to the completion of major construction projects, including the Hervey Bay Community Hub, which previously drew temporary workers into the region. Once those projects wrapped, short-term rental demand evaporated, leaving more stock available for longer-term tenants. New housing approvals also ticked up across parts of regional Queensland over the past 18 months, and that supply is now landing.
Migration to Queensland continues but at a slower pace than the 2021–2023 surge, easing demand growth at the margin. Break leases are reportedly more common, with tenants trading down to cheaper accommodation or relocating to looser markets. Higher-priced rentals in some regional centres are taking longer to secure tenants, signalling affordability constraints are biting.
The markets that stayed locked
Southeast Queensland’s major population centres moved barely at all. Brisbane LGA and Greater Brisbane (0.8%) were flat quarter-on-quarter. Ipswich and Moreton Bay both sit at 0.7%, unchanged. Toowoomba tightened to 0.6%, Townsville to 0.9%, Cairns to 0.8%. Cook and Goondwindi recorded zero vacancies, meaning every available rental is occupied and any tenant movement triggers immediate re-letting.
In Redcliffe, families evicted from rental homes set up camp in public spaces, a visible marker of how tight the market remains. Pine Rivers, at 0.6%, offers tenants no buffer. These figures sit well below the 2.6% threshold for a healthy market, meaning landlords face minimal vacancy risk and can push rents higher with little resistance.
Callout: Key numbers
Statewide vacancy: 1.0% (unchanged)
Regions under 1%: 29 out of 50
Regions above 2%: 6 (Bay Islands 4.3%, Isaac 6.2%, Fraser Coast 2.2%, Hervey Bay 2.3%, Gladstone 2.1%, Noosa 2.2%)
Tightest markets: Cook and Goondwindi (0%), Redcliffe (0.5%), Pine Rivers (0.6%)
The pressure on both sides
Property managers report that landlords are feeling the squeeze from higher mortgage repayments, insurance premiums, and compliance costs. Some owners are deferring non-essential maintenance and upgrades because absorbing additional expenses has become harder. That reluctance signals strain across the housing system, not just among tenants. When landlords pull back on property upkeep, it can degrade rental stock quality over time, compounding supply problems.
Tenants face their own affordability ceiling. Brisbane’s median weekly rent now sits around $700, and with Queensland’s rent increase cap in place, the full impact of recent federal tax changes to depreciation and travel deductions won’t flow through immediately. The lag means current vacancy data may not yet reflect reduced investor appetite. Policymakers made clear their intent was to make property investment less attractive; the question is whether that deterrent effect will shrink rental supply further as existing landlords exit and fewer new investors enter.
What drives investor decisions now
For investors, the regional split matters. Markets with vacancies above 2% (Fraser Coast, Hervey Bay, Noosa, Gladstone) offer lower immediate rental stress but also signal moderating rental growth. If vacancy continues rising toward 3%, yield compression becomes a real risk. Investors in these areas should revisit their rental pricing assumptions and model cashflow under flat or declining rent scenarios.
Markets under 1% still offer pricing power, but the downside is exposure to policy risk. State and federal governments are under political pressure to intervene when vacancy rates sit this low. Rent caps, tenancy law changes, or land tax adjustments could all tighten net returns. The tightest markets (Cook, Goondwindi, Redcliffe, Pine Rivers) are also the most vulnerable to sudden supply shocks if new projects hit the market or if migration patterns shift.
The Fraser Coast example shows how quickly vacancy can move when temporary demand (construction workers, project staff) exits. Investors relying on short-term drivers should stress-test what happens when those workers leave. Conversely, new housing supply remains concentrated in specific corridors, so submarkets within the same LGA can diverge sharply.
Trade-offs in the next twelve months
Base case: statewide vacancy holds near 1% as supply growth stays modest and net migration to Queensland continues at a slower pace. Regional Queensland sees further selective loosening in areas where construction completions cluster, while Southeast Queensland’s major centres remain tight. Rental growth moderates but doesn’t reverse, with affordability acting as a brake on further large increases.
Upside (for landlords): if building approvals stall or migration accelerates again, vacancy could tighten further, pushing rents higher in already-constrained markets. Downside: if affordability pressures trigger sharper policy intervention (expanded rent caps, tenancy law changes, land tax hikes) or if investor exits accelerate due to tax changes, vacancy could rise faster than supply data currently suggests, compressing yields.
Planning reforms in other states signal the political direction, but implementation lags mean new supply from density increases won’t land for 18 to 24 months at best. In the interim, investors face a window where vacancy remains low but policy risk is elevated.
Red flags for the next six months
Watch for further increases in break leases, particularly in higher-rent brackets. If tenants are trading down or leaving the state, that’s an early indicator of demand weakness. Track building approval data and completion timelines in your target LGA; concentrated supply landing in a single quarter can flip a tight market quickly. Monitor any state or federal policy announcements on negative gearing, land tax, or rent caps, all of which remain live political issues.
If vacancy in Southeast Queensland’s major centres moves above 1.5%, that’s a meaningful shift from the current baseline and suggests affordability constraints are starting to override population growth. Conversely, if Cook, Goondwindi, or other zero-vacancy markets stay locked for another two quarters, expect heightened political pressure and potential regulatory intervention.
What to do next
If you own in a loosening market (Fraser Coast, Hervey Bay, Gold Coast), model your cashflow assuming flat rents for the next 12 months and a small vacancy buffer. If you’re in a sub-1% market, stress-test your position against a sudden policy change or supply surge. For new purchases, prioritise submarkets where supply pipelines are transparent and demand drivers are structural (employment, university enrolment, permanent migration) rather than temporary (construction projects, short-term work contracts).
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General info, not financial advice.
