The latest SQM stats just came out with a 0.4% vacancy rate
http://www.sqmresearch.com.au/graphs/graph_vacancy.php?postcode=4680&t=1
To me the best indicator of future rents is the jobs to rentals ratio.
Current rentals on realestate.com.au = 74
Current jobs in Gladstone on seek.com.au = 1180
Current ratio = 15.9
This compares with Karratha
Rentals = 42
Jobs = 290
Ratio = 6.9
Port/South Hedland
Rentals = 52
Jobs = 341
Ratio = 6.5
There is clearly far more upward pressure on the Gladstone market than either Karratha or Hedland. As the thousands of workers pour in rentals will skyrocket.
I have noticed that typically in these markets the rental return tends to peak at 10% yield. It is likely that we will see this happen in Gladstone. Once rents hit 10% yield, (i.e. average house price $400k, average rent $800 per week), any further incremental rental increase will be proportionally reflected in the house prices, (i.e. when rents hit $1000 per week, properties suddenly leap to average $500k)
I think people will be surprised at how fast these kinds of rents will happen when there is such huge competition for very few rentals especially with so many competing projects all needing to house their workers. Corporates will pay a premium to secure housing as has already happened in Karratha, Hedland, Dysart etc.
Dysart is a great example of how fast these conditions can change:
18 months ago, 3 bedroom houses rented for $550 per week
1 month ago, 3 bedroom houses rented for $1,000 per week
today, 3 bedroom houses rent for $1,300 to $1,500 per week!!
Their jobs to rental ratio is 51/6 = 8.5
Watch their house prices skyrocket this year to balance out to the 10% yield rule.
My own house in Gladstone has had a rent increase from $360 to $450 per week in the past 8 months. I expect my next rent review in 5 months to be in the $540-$590 range although I could easily command more based on this search
http://www.realestate.com.au/rent/i...nding=false&misc=furnished&source=refinements
It seems 3 bedroom fully furnished nice houses are going for $800+ per week