Hotspotting
The greatest complaint heard most often in real estate across Australia is that there are plenty of buyers, but a shortage of listings. The number of properties for sale has been well short of the levels needed for a balanced market, particularly in the boom cities of Adelaide, Brisbane and Perth. But that is steadily changing. According to SQM Research, total listings of properties for sale nationwide grew 7.6% in November and are now more than 10% higher than a year ago. Perhaps most significantly, there were major rises in November in those three boom cities, with the...
info_outline Media AbsurditiesHotspotting
Things are constantly changing in real estate nationwide but the one factor that never changes is this: we can always rely on news media to distort the facts and deliver a steady flow of misinformation to Australian consumers, all in the interests of attracting readership, with little regard for accuracy, honesty or fairness. The past week or so has been chockful of media nonsense. If you can believe the headlines, the national property boom is over, house prices are plunging, the rental boom is over and the North Queensland city of Townsville is a mining town. One of the constants of my...
info_outline 2025 PredictionsHotspotting
Rumours of the death of ‘the national property boom’ are greatly exaggerated – especially since we didn’t have a national property boom in 2024. Rather, over the past 12 months, we have seen differing market cycles in many locations - as is the usual state of play in real estate throughout Australia. Strong property price growth was recorded in Perth, Adelaide, and Brisbane in 2024, but not in Melbourne, Sydney, Canberra, Darwin or Hobart. Similarly, in the regional areas, there were declining and stagnating markets, as well as some where prices were showing good price...
info_outline Regional Investment BoomHotspotting
Victoria’s real estate market is witnessing a significant shift as young first-home buyers increasingly seek affordable housing in regional areas. According to recent data from the Australian Bureau of Statistics (ABS), first-home buyer loans in Victoria soared to 4,202 in July – the highest number in nearly two years. This surge reflects growing confidence among young buyers and a trend towards exploring housing options beyond Melbourne. Nationally, the Commonwealth Bank of Australia and the Regional Australia Institute report that the flow of people from cities...
info_outline Units Beat HousesHotspotting
Hotspotting was among the first to identify and highlight the most significant change in the Australian real estate scene – the emerging trend which we document in the quarterly editions of the report titled The Rise and Rise of Apartments., published in association with Nuestar. This trend has turned upside down the dominant paradigm in real estate, that houses out-perform apartments on capital growth. There is now growing evidence that attached dwellings are mounting a strong challenge to houses. It has long been believed that land content was the big thing in driving...
info_outline Why a Buyer’s Agent Is a Game-Changer for Property Investors | Featuring Chris GrahamHotspotting
Thinking of buying property on your own? 🏡 In this episode of The Property Playbook, host Terry Ryder is joined by Chris Graham, Senior Property Advisor at Australian Hotspot Advocacy, to explore why engaging a buyer’s agent could be the key to securing your next winning investment. What You'll Learn: What a buyer’s agent does and how they work exclusively for the buyer’s interests. The value of off-market properties and how buyer’s agents can provide access. Why having a professional on your team ensures due diligence and avoids costly mistakes. How to identify a trustworthy...
info_outline Melbourne Market MythsHotspotting
Melbourne’s property market remains the great under-achiever of the nation but that may be about to change. A number of key indicators suggest better performance by the Melbourne property market is imminent. One pointer to better times is the latest Property Sentiment survey by API magazine, which recorded a major turnaround in investor attitudes towards the Victorian property market. The survey asked: Which state or territory do you regard as having the best property investment prospects for the next 12 months? Mid-year Melbourne and Victoria attracted only 8.6...
info_outline Interest Rates & PricesHotspotting
I have frequently highlighted the poor track record of economists in predicting outcomes in real estate markets across Australia – and in particular the embarrassingly bad record of economists working for the Big 4 banks and for other major institutions like AMP Capital. Their forecasts for house prices at the beginning of each of the past five years have been so far off the mark, it’s puzzling that the big-name economists who made these blunders have kept their jobs. Because what these outcomes mean is that these boffins have a very poor understanding of residential real...
info_outline The Property Playbook - Shifting perspective: the key players in Australia’s housing crisisHotspotting
The Property Playbook is a dynamic real estate show that empowers investors and professionals with the insights and strategies needed to achieve strong returns in the Australian property market. Hosted by Tim Graham & Terry Ryder from Hotspotting. In this episode, Tim Graham is joined by Ben Kingsley, Chair of the Property Investors Council of Australia. to discuss advocacy work for property investors amidst legislative changes and their impact on the housing market. Ben emphasises the need for balance in tenant rights and business returns and dissects the consequences of...
info_outline Smart Investing Achieve More Than 6% Yield Without Compromising GrowthHotspotting
Discover how to achieve the ultimate win-win in property investment: high rental yields and strong capital growth. In this replay of Hotspotting's exclusive webinar, Terry Ryder, founder of Hotspotting, and Tim Graham, General Manager, reveal key insights from their groundbreaking "Pulse Report." Key Topics Covered: The Affordability Advantage: How affordable properties can outperform prime markets. Debunking the myth that cheap real estate doesn’t grow. Top Performing Locations: A spotlight on suburbs and regional areas delivering over 6% rental yields and up to 29%...
info_outlineHow long could we reasonably expect governments to take, to sort out a problem like the rental shortage?
I ask the question because we have had the problem of a shortage of options for tenants in Australia – and the consequent steep rises in rents - for a very long time.
And it keeps getting worse, not better.
The latest data from SQM Research shows that, nationally, the vacancy rate got a little worse last month, dropping from 1.3% in August to 1.2% in September.
Three of our capital cities have vacancies well below 1%.
And in six of the eight capital cities, vacancies stayed the same or got smaller in September. In only two cities was there a slight improvement.
But the key piece of information is the longevity of this rental shortage crisis.
Australia has had vacancies below 1.5% for close to three years now.
It’s generally considered that a balanced rental market – one in which there is ample supply of homes for tenants to choose from and rents are stable – is one where vacancies are at least 3%.
The data from SQM Research shows that Australia has not had a vacancy rate as high as 3% at any time in the past 20 years.
The closest we came was 2.9% in April 2020 after the onset of Covid caused major disruption to property markets.
Since then, the national vacancy rate has dropped sharply, reaching 1.2% in March 2022 – and it has hovered between 1% and 1.3% for the past two and a half years.
According to SQM Research, a further 1,700 rental properties disappeared from Australia’s rental market in September – at a time when the nation’s population has surpassed 27 million.
The SQM report said: “The total number of rental vacancies now stands at 37,932 residential properties, a decrease from 39,665 in August.”
There are clear reasons why we have had this steady decline in the number of properties available for rental, a shortage which has caused rents to rise and rise.
Mostly, those reasons relate to the decisions of politicians, particularly state politicians, in making life increasingly onerous for the investors who provide over 90% of the homes that people rent in Australia.
State and territory governments have increased taxes on investors and have changed the rental laws in ways that have eroded the rights of the owners.
This has led to a reduction in the number of homes available for rental.
In Victoria, the state with the most onerous conditions for investors including big tax increases, the number of rental properties in the state has fallen by 22,000 so far this year, as the investor exodus gathered momentum on the back of anti-landlord legislation.
That’s according to new data from the Department of Families, Fairness and Housing.
And its data supports a trend identified in the latest Investor Sentiment Survey published by PIPA – the Property Investment Professionals of Australia (PIPA).
The survey described a "sell-off of investment properties around the nation" that has "continuing unabated" and "fuelling fears of an even tighter rental market".
But the problem is most acute in Victoria. PIPA Victoria board director Cate Bakos says legislative changes and increased taxes are driving investors from the state.
A new land tax regime, minimum rental property standards legislation, and policies that are seen as overly tenant-friendly have caused many investors to sell up in Victoria.
Nicola McDougall, the Chair of PIPA says: “This is predominantly due to its plethora of anti-investor rental reforms, as well its new land tax regime that is set to cost investors billions of dollars over the years ahead.”
PIPA’s annual investor sentiment survey found Victoria was regarded as the “least accommodating” state or territory for property investors in the nation, with 22% of survey respondents indicating they had sold at least one dwelling in Melbourne in the last year.
As a consequence, rental availability has fallen and rents have risen.
Data from Domain shows that the vast majority of Melbourne suburbs recorded rent rises this year, continuing a trend that has extended over several years.
According to the Domain rent report for the September quarter, the median house rent in Melbourne at the start of 2022 was $440 a week. Now it’s $580 a week.
The median unit rent was $375 a week in January 2022 and now it’s $550 a week. That’s an increase of almost 50% in less than three years.
But the problems keep getting worse, with NSW being the latest state government to pass new laws detrimental to landlords.
REINSW CEO Tim McKibbin says the lessons for the NSW Government are crystal clear but have been disregarded.
He says: “The removal of landlords’ rights under the guise of populist rental reforms has had a clear negative impact on renters elsewhere.
“The rental reforms by the NSW Government will result in more investors selling up or opting for a short-term accommodation strategy, both of which remove more properties from the private rental market.
“This is already happening and it’s happening at a time when the NSW population is increasing by over 15,000 people each month. The rental market is in crisis and we need solutions, not reforms that we know from recent experience will make the problem worse.”
And that pretty much sums up the seriousness and absurdity of this ongoing issue.
Australia has had a rental shortage crisis for several years but the only policies implemented by state governments have made a bad situation even worse.