{"id":15459,"date":"2022-03-14T02:13:07","date_gmt":"2022-03-14T02:13:07","guid":{"rendered":"http:\/\/www.16news.com.au\/?p=15459"},"modified":"2022-03-14T02:13:07","modified_gmt":"2022-03-14T02:13:07","slug":"floods-add-to-the-looming-rental-crisis","status":"publish","type":"post","link":"http:\/\/www.16news.com.au\/index.php\/2022\/03\/14\/floods-add-to-the-looming-rental-crisis\/","title":{"rendered":"Floods add to the looming rental crisis\u00a0"},"content":{"rendered":"\n

Flooding damages homes<\/strong><\/p>\n\n\n\n

Australia is facing a rental crisis that has been exacerbated by the recent flooding events, according to Pete Wargent, co-founder of Australia\u2019s first national marketplace for buyer\u2019s agents, BuyersBuyers.<\/p>\n\n\n\n

Mr Wargent said, \u201crental markets were already in a tightening cycle. The floods in New South Wales and Queensland have added further pressure in certain markets, such as the Northern Rivers region of New South Wales, where there was already a housing shortage, and for family-suitable housing in Brisbane.\u201d<\/p>\n\n\n\n

\u201cAll of the eight capital cities were already seeing a trend decline in vacancy rates with the honourable exception of Darwin, while many regional markets are, practically speaking, at full capacity\u201d Mr Wargent said. <\/p>\n\n\n\n

Figure 1 \u2013 Rental vacancy rates<\/strong><\/p>\n\n\n\n

\u201cBrisbane saw an estimated 15,000 homes flooded in this event, rendering potentially thousands of homes uninhabitable, and vacancy rates were already at decade lows there too. So the disruption is going to cause a good deal of friction in the rentals market.\u201d<\/p>\n\n\n\n

\u201cMore broadly, nationally the rental vacancy rate has fallen to around 1 per cent for the first time in over a decade-and-a-half, and there are further declines in the post as the international borders finally reopen and as total employment surges to record highs at over 13\u00bd million this year\u201d Mr Wargent said. <\/p>\n\n\n\n

Building crunch<\/strong><\/p>\n\n\n\n

BuyersBuyers CEO Doron Peleg said fewer new homes will be completed in 2022 as building approvals decline and the rising cost of materials and construction labour discourages development.<\/p>\n\n\n\n

Mr Peleg said, \u201cnot only are financing costs set to rise but the cost of building materials and trades labour has also already jumped. The problem when you have a disaster with widespread impact such as flooding over two states is that this typically adds further pressure to the cost of labour and materials.\u201d<\/p>\n\n\n\n

\u201cThe HomeBuilder stimulus package was successful in getting more homes built for a period of time \u2013 and major renovation activity has been running hot – but approvals are now dropping away.\u201d<\/p>\n\n\n\n

Figure 2 \u2013 Detached house approvals by capital city<\/strong><\/p>\n\n\n\n

\u201cFurthermore, there is considerably less demand from overseas investors, which means that attached dwelling approvals, in particular for high-rise unit developments, have failed to gain as much traction through this market cycle\u201d Mr Peleg said. <\/p>\n\n\n\n

Figure 3 \u2013 Attached dwelling approvals by capital city<\/strong><\/p>\n\n\n\n

Construction insolvencies inevitable<\/strong><\/p>\n\n\n\n


BuyersBuyers co-founder Pete Wargent said, \u201cthe recent announcement that Probuild may be heading into administration appears likely to be canary in the coalmine for the construction sector.<\/p>\n\n\n\n

Mr Wargent said, \u201cprofit margins are typically thin for developers and overlapping supply shocks have put a great deal of pressure on the cost of materials and labour.\u201d<\/p>\n\n\n\n

\u201cInsolvencies have been exceptionally low for two years in the construction sector, but we can see that is now already changing, and further insolvencies will see many projects left incomplete as funding costs rise.\u201d<\/p>\n\n\n\n

Figure 4 \u2013 Construction insolvencies by state<\/strong><\/p>\n\n\n\n

\u201cOverall, there were already a range of factors which were conspiring to put a good deal of pressure on rental markets.\u201d <\/p>\n\n\n\n

\u201cTalk of potential hikes in interest rates will naturally tilt the balance from buying to renting for many marginal households, and with landlords less eager to invest then the result is likely to be a rental crisis and double-digit growth in rental prices\u201d Mr Wargent said.<\/p>\n","protected":false},"excerpt":{"rendered":"

Flooding damages homes Australia is facing a rental crisis that has been exacerbated by the recent flooding events, according to Pete Wargent, co-founder of Australia\u2019s first national marketplace for buyer\u2019s agents, BuyersBuyers. Mr Wargent said, \u201crental markets were already in a tightening cycle. The floods in New South Wales and Queensland have added further pressure … Continue reading “Floods add to the looming rental crisis\u00a0“<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-15459","post","type-post","status-publish","format-standard","hentry","category-aussie"],"_links":{"self":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/15459","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/comments?post=15459"}],"version-history":[{"count":1,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/15459\/revisions"}],"predecessor-version":[{"id":15460,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/posts\/15459\/revisions\/15460"}],"wp:attachment":[{"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/media?parent=15459"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/categories?post=15459"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.16news.com.au\/index.php\/wp-json\/wp\/v2\/tags?post=15459"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}