Brisbane investors opt for serviced apartments over residential rental

The drop was due to stiff competition from the booming office sector and lower off-the-plan sales.

According to BIS Shrapnel, the drop is also attributed to a buoyant hotel market that has encouraged investors to hold their apartments back from residential rental for use as serviced apartments. This is despite a healthy 64 per cent rise in median rent for inner Brisbane apartments since 2001.

While prices of inner city apartments are forecast to grow 36 per cent over the coming five years, BIS Shrapnel still projects that offices and serviced apartments over the next two years will provide developers with better returns.