Reprinted from Perthnow – read directly from their site here.
TENANTS are being offered free TVs, iPads, gift vouchers and $2000 cash to rent in Mackay as the effects of mining jobs losses hit the economy.
The city that is the gateway to the Bowen Basin once had one of the tightest rental markets in Queensland, with people forced to live in dongas and garages.
But it now has the highest vacancy rate, with landlords forced to slash rents by up to $100 and offer enticing deals.
One agency has been offering $2000 or $1000 towards the cost of moving (but the money can be spent on anything) plus two weeks’ free rent.
Another advertised a free iPad or 81cm flatscreen TV for a limited period while another was giving away $500 Coles-Meyer vouchers.
Many new four-bedroom, brick-and-tile houses are advertised with one or two weeks’ free rent or promoting the fact that ”We are doing deals”.
There was also one property giving prospective tenants the choice of free lawn maintenance or a 12-month Austar pay-TV connection, while another included electricity.
The dramatic rental downturn is blamed on mining job losses and people leaving the region plus an overabundance of new investment houses built during the boom.
The Queensland Resources Council estimates there have been 8000 jobs lost in Queensland’s coal industry since May last year, with a flow-on into the service industries.
Hugh Reilly Real Estate agent Josey Comerford said agents were doing ”anything we can possibly do to entice a tenant”.
”Everything is negotiable at the moment but you can’t put that on your advertising. You can’t say ‘Make an offer’.
”But when we’re talking to people and they make us an offer we will take it to the owner.”
Median rents for a three-bedroom house were at $440 in the June quarter which was $60 less than last year.
Agents say rents have come down between $50 and $100 in the past six months since job cuts started having an effect.
REIQ Mackay zone chairman Sally Richards said it was the first time she could recall agents having to spruik deals to lure tenants.
Ms Richards said the region’s vacancy rate had skyrocketed from 0.7 per cent at its lowest to 6.6 per cent now.
”I don’t know if the vacancy rate has ever been this high since I’ve been doing real estate,”
”We were one of the lowest in the state. We’re the highest in the state now. It’s not good but it’s brought on by an influx of builders building spec homes.
“We do have a lot of house and land packages. Mackay was a good place to invest but everyone’s affected by the uncertainty in mining.”
Votiva Realty’s Susanne Hartberg said the agency had been offering a $2000 incentive on some homes, with the offer borne by the agency and the landlord wearing the two weeks’ free rent.
“Anybody who qualifies for a tenancy can qualify for the $2000. It’s up to them how they spend it,” Ms Hartberg said. “We see some people put it towards the bond. Others may take the money and spend it on something else.”
Mackay Rentals principal Barbara Mayfield said tenants who signed in August would go in the draw to win $500 cash.
“We don’t really know if it will work but we have to try different things. We just have to get people through the door.”
But Tanya Booth, from Insite Realty, described some of the offers as “ludicrous” and warned they could send landlords to the wall.
“These homes are worth more,” she said. “They’re scaring the market and I am worried.”