Australia’s biggest garrison city is under pressure from a housing market that can’t keep pace with demand.
As the unofficial capital of North Queensland and a strategic hub for the region’s defence, resources and agriculture industries, Townsville is one of Australia’s hottest property markets. Finding a rental is tough for tenants. For investors, the opportunities have rarely been stronger.
According to the Townsville City Council’s Residential Property Market data, the city’s median house price reached $635,000 in the December 2025 quarter, up more than 22 per cent year-on-year.1 This is more than double the national average2 and is the highest annual growth rate of any major market in Queensland3.
Units have tracked a similar path, with annual price growth of 23.2 per cent over the same period.4
A city built around Defence
Townsville has made its mark as the major service hub for North Queensland with a broad and resilient economy. Home to the Townsville University Hospital and James Cook University, it is a commercial gateway to the Channel Country and Mount Isa mining regions.
Two major infrastructure projects are set to deepen the city’s economic base. The 2025-26 Queensland Budget committed $2.4 billion to CopperString 2032, a planned 840-kilometre transmission line connecting the North Queensland grid to the minerals-rich outback.5 The Lansdown Eco-Industrial Precinct, a declared major project, is being developed as a processing hub for critical minerals, positioning Townsville at the forefront of Australia’s clean energy supply chain.6
The city is also home to Australia’s largest Army base, Lavarack Barracks, as well as RAAF Base Townsville. Together, these facilities support around 5200 Defence personnel, along with their families.
In recent years, the city’s Defence footprint has grown, with a $700 million commitment to base a fleet of Apache attack helicopters at RAAF Base Townsville, and $35 million invested in facility upgrades, bringing new personnel and infrastructure.7
The result is a large and stable resident Defence community with a growing demand for quality homes.
A tight market with room to grow
The Queensland Government expects Townsville’s population to reach 265,000 by 2046, an increase of around 30 per cent.8
Renters are already feeling the squeeze. Rental vacancies sit at around one per cent9, which is well below the two to three per cent that signals a balanced market. Median weekly rents have climbed to $560 for three and four-bedroom houses and $390 for units, yielding around 4.6 per cent and 4.8 per cent per annum respectively.10
A 2025 report by property analyst Michael Matusik suggested Townsville would need more than 9,000 new homes over the next five years11, yet building approvals have fallen by almost 45 per cent since 202112.
DHA Business Development Officer Tania Stevens has lived in Townsville all her life and watched the city grow.
She said the current housing shortage was more acute for apartments and smaller dwellings. High construction costs, compounded by the expense of transporting materials from the south, was continuing to suppress new apartment supply.
“It’s the single Defence members who are really struggling to find accommodation right now,” she said. “If Defence members can’t find something through DHA, it’s still very difficult for them to find something in the private sector.”
The DHA advantage
Defence Housing Australia (DHA) is actively looking for rental properties in Townsville, particularly in the newer subdivisions along the Ring Road corridor, such as Burdell, Julago, Bohle Plains, Cosgrove and Shaw. New and freshly renovated three and four-bedroom houses are in strong demand, even if they don’t exactly match traditional DHA specifications, along with apartments or townhouses suitable for single Defence members.
If you own a property in one of these areas, or are considering buying or building, leasing to DHA is worth considering – particularly for remote landlords who want the security, comfort and convenience of quality Defence occupants, and a long and fully-managed lease.
As a Government Business Enterprise, DHA commits to lease properties for three to 12 years. Rent is reviewed annually and guaranteed even if the property is vacant.13 DHA’s service fee covers most non-structural repairs14, taking many of the unpredictable costs and unexpected cashflow impacts out of the equation for owners.
Through DHA’s Build to Lease program, investors can select a house and land package from a builder of their choice or from a range of pre-approved packages. Provided it meets DHA's requirements for location, space, comfort and finish, a lease commitment can be in place well before construction begins.
Interested in increasing your northern exposure? Explore available house and land packages(Opens in a new tab/window), use the online enquiry form(Opens in a new tab/window) to find out more, or call 133 342 to speak to our leasing team.
1. Townsville City Council, Townsville Residential Property Market (Valuer-General property sales data), December 2025 quarter, https://data.gov.au/data/dataset/townsville-residential-property-market(Opens in a new tab/window)
2. Cotality, Home Value Index: Softer landing after strong 2025(Opens in a new tab/window), 2 January 2026
3. Real Estate Institute of Queensland, Queensland property prices pushed up by persistent supply pressures, 31 March 2026, www.reiq.com/resources/media-releases/queensland-property-prices-pushed-up-by-persistent-supply-pressures(Opens in a new tab/window)
4. Townsville City Council, Townsville Residential Property Market (Valuer-General property sales data), December 2025 quarter, https://data.gov.au/data/dataset/townsville-residential-property-market(Opens in a new tab/window)
5. Queensland Treasury, Queensland Government delivers record investment in CopperString, 2025–26 State Budget, www.treasury.qld.gov.au/newsroom/newsroom-copperstring(Opens in a new tab/window)
6. Office of the Coordinator-General, Queensland Government, Lansdown Eco-Industrial Precinct, updated 25 March 2026, www.coordinatorgeneral.qld.gov.au/projects/find-a-project/prescribed-projects/lansdown-eco-industrial-precinct(Opens in a new tab/window)
7. Defence Connect, Infrastructure funding announced for RAAF Base Townsville, Lavarack Barracks, 23 January 2024, www.defenceconnect.com.au/land/13485-infrastructure-funding-announced-for-raaf-base-townsville-lavarack-barracks(Opens in a new tab/window)
8. Queensland Government Statistician’s Office, Queensland Treasury, Queensland Government population projections: Regions, 2023 edition, published 12 June 2023, www.qgso.qld.gov.au/statistics/theme/population/population-projections/regions(Opens in a new tab/window)
9. Real Estate Institute of Queensland, Queensland property prices pushed up by persistent supply pressures, 31 March 2026, www.reiq.com/resources/media-releases/queensland-property-prices-pushed-up-by-persistent-supply-pressures(Opens in a new tab/window)
10. Averaged from Townsville City Council, Townsville Residential Property Market (Residential Tenancies Authority rental bonds data), December 2025 quarter, https://data.gov.au/data/dataset/townsville-residential-property-market(Opens in a new tab/window)
11. Matusik Property Insights, Townsville Housing Supply Analysis, 2025, cited in townsvillerentals.com.au/townsville-property-market-outlook-2025(Opens in a new tab/window)
12. Australian Bureau of Statistics, Building Approvals, Australia (cat. 8731.0) compiled by .id, www.profile.id.com.au/townsville/building-approvals(Opens in a new tab/window)
13. Rent may be subject to abatement under certain circumstances such as loss of enjoyment or amenity, or breach of lease terms. Rent is paid where the property is habitable. Should a property become uninhabitable during the term of the lease, or the lessor breaches the lease terms, the rent may cease or abate and the lease may be terminated by DHA. Guaranteed rent is subject to the terms of the lease. DHA does not take into account an investor’s objectives or financial needs. Investors should always seek appropriate independent advice before making any investment decisions with DHA.
14. A comprehensive description of repairs included in our service and exclusions can be found in the Property Care Contract. For more information, visit dha.gov.au/investing/property-care.
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