Nearly 40 per cent of investors surveyed by a peak industry body have sold at least one Queensland rental property in the past year — more than anywhere else in the country.

The latest annual survey by the Property Investment Professionals of Australia, released today, confirms landlords are fleeing the market, with 39.8 per cent of investors offloading one or more properties across the state in the past year.

The survey showed 23 per cent of investors have sold their rental property in Brisbane, and 16.5 per cent in regional Queensland.

But Queensland remains the most popular state to invest in property, according to the survey.PIPA chair Nicola McDougall said with investors hit hard by interest rate hikes the number considering selling in the next year was at “scary” levels.

Ms McDougall said Queensland was leading the charge because of its “restrictive, unfair and inefficient legislative reforms that adversely impact property investors.

“At a time when tenants can least afford it, the people providing the vast majority of rental homes are selling up in droves.”

Nationally, more than 12 per cent of investors sold one or more properties in the past year.

Ms McDougall said almost 30 per cent of investors ranked Queensland as the nation’s number one investment state, but its appeal was waning.

“Over the last few years Queensland and Brisbane were by far the most attractive locations for investors,” she said.

“Queensland is still number one, but less and less so. It’s down from 33 per cent last year and 58 per cent in 2021.

Of those investors exiting the market, their property was bought by another investor in just 24 per cent of cases — down from 33 per cent last year. Overwhelmingly, those rental homes were bought by existing homeowners (43.1 per cent) or first-home buyers (30.3 per cent).

More investors selling means more options for first homebuyers like Kiah Coupland, who has escaped the rental trap and purchased her first home in Ripley

.Ms Coupland said she planned to keep her first home as an investment property, once she could build up some equity and buy another property.

“When my loan was approved, I got more money than I needed to be safe,” she said. “I decided to move west because it was cheaper and more manageable to live than towards the inner city.

“My goal is to keep my first home as an investment property, but for now, I’ll stay put to keep paying the mortgage off and still have a comfortable life.

”Nationwide, only 55 per cent of investors are considering buying in the next year, down from 62 per cent in 2021.

The survey of 1724 investors found increased property taxes were the biggest motivation to sell for investors and had been a factor in 47 per cent of the sales nationwide.

InvestorKit founder Arjun Paliwal said even governments talking about changes to property investment regulations was enough to scare off investors.

“You’re likely to see the trend of investor sales continue this year, but that will come down,” Mr Paliwal said.

“With interest rates on hold for a few months in a row now, investors may gain a bit more confidence. The main thing is Queensland’s rental market remains extremely undersupplied. “Rents are likely to rise by double digits in the next 12 months, our data suggests, and we anticipate sharehousing will pick up.

”PIPA’s estimates on sales across the past three years extrapolated the 12.1 per cent of survey respondents who said they had sold an investment in the past year to the 2.478 million investment homes listed in the 2021 Census. It factors in that 27 per cent of investors had sold to another investor, but has not been adjusted for other properties purchased as investments.

Originally Published: Nathan Mawby, Elizabeth Tilley and David Bonaddio | News Corp Australia Network | 12 September 2023

https://www.themercury.com.au/property/rental-crisis-nearly-40pc-of-investors-selling-up-in-qld/news-story/8f8437ba6ab9faf5ed8d474df037f03e?btr=a35a178b012f3b7fdd87151042ddc107