The sudden downward slide is “unprecedented” and the result of a standoff between landlords and investors.
So severe is the bubble burst, that Real Wealth Australia is now warning investors not to buy there, after months of telling investors that Moranbah was one of the best ‘hotspots’ in the country.
“Don’t buy, it’s too uncertain at the moment,” warns Kogtevs.
“I had three places go up for rent in the last three weeks. I’m still getting $1800 a week but prior to Christmas I would have got about $2300 or $2400 per week.”
Kogtevs says the reason behind the sudden rental collapse is because BHP Billiton-Mitsubishi Alliance (BMA) is going hard on its enterprise agreement with the unions.
“They could be going for lockouts and doing a Qantas,” he explains.
At the same time, BMA and other mining companies are trying to drive down rents by refusing to re-sign new leases. But the double whammy is that residents who have lived in Moranbah all their lives are now bailing out and selling their properties for their retirement, says Kogtevs.
Guess the mining companies have realised they have more power than they originally thought and can just refuse to pay more rent. it's not like the local check out chick is competing with them.