Bucking national trend to hit record high, Domain report reveals

“But the bottom line for Brisbane is that the pressure is still there and the city is bucking the national trend.”

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The widening gap between wages and property prices is causing more residents to be locked into the rental market, Powell said.

At the suburban level, units in the Grange rose 22.2 percent to $550 a week, the city’s strongest annual growth. In terms of homes, New Farm topped the list, with rents rising 18.9 percent to $1,100; This has overtaken Teneriffe and Ascot as Brisbane’s most expensive suburbs to rent a house.

South Brisbane is now the most expensive place to rent an apartment, with weekly rents rising 7.6 per cent in 12 months to $775. Brisbane City, Newstead and Teneriffe follow close behind at $750, with annual growth of 4.2 percent.

Ray White South Brisbane head of property management Lachlan McLean said a number of high-end developments such as Aria, a shortage of stock and a growing demand for living “this side of the river” had seen the suburb rise to the top.

Families and executive couples forced to postpone construction plans because of construction delays or bridge financing constraints are increasingly downsizing apartments in and around the river area, he said.

In the mid-tier market, McLean said professional couples, interstate and international immigrants and groups of friends were driving demand.

“The price of a two-bed firm in South Brisbane is currently between $700 and $800 and we are seeing an incredible amount of interest in this sector,” he said.

“We are also seeing more friends, or even two couples, moving in together to save on rent and save themselves a deposit.

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“Even multi-generational families are more common now. And that’s a consequence of the affordability ceiling being hit.”

Ray White Collective managing director Haesley Cush said September’s rise reflected seasonal movement after rents stabilized over the winter.

“What we saw during the housing shortage was that supply and demand were so skewed in favor of homeowners that it took time for people to find their place in this new game of musical chairs,” he said.

“People have had to increase their price range or change their expectations and move to a different suburb or property style. And by mid-year most people have found their place. That high-octane competition has leveled out a bit. Now seasonality is coming back into play in the market.”

Cush said New Farm’s standout performance reflected both the spring boom and strong demand from homeowners displaced by renovation delays.

Overall, he said affordability pressures and new provincial legislation, including capping rent increases at once per year, are keeping growth in check.

Business development manager for Place Nundah and Ascot Caleb Reis said the high-end market was still hot.

“We used to see $2,000 or $3,000 rentals on the market for weeks, but now they close within the first week,” he said.

“And that’s because there are so few opportunities.”

But the middle of the market is starting to stabilize, he said.

“The cost of a two-bedroom, inner-city or three-bedroom house in the outer suburbs is now around $800 a week, and the market is still digesting that,” he said.

“But the one-bedroom market [Fortitude] Valley is pumping. “If I had 20 flats there, I would rent them all in one day.”