This week we’re popping under the Queensland bonnet to have a thorough look at how the state’s property market is actually performing
Round about the time Queensland was preparing for the final game of this year’s State of Origin, Brisbane resident Melissa Paulson was running late for an important appointment. She was due to meet a valuer at her investment property in Beenleigh, on the city’s southern fringe, but on her way got caught in the traffic outside Suncorp Stadium.
Her two-year old son in the back seat, thirsty and crying, the traffic added to an already tense situation for Paulson. She and husband Dave had bought the property five years ago, their first. They had never had it valued since purchase and weren’t sure what to expect. They were hoping to see some reasonable capital growth and use this to leverage for additional purchases. Fingers clenched around the steering wheel, Paulson knew she had a lot riding on this.
When she eventually pulled into the property’s driveway, her heart was beating fast. She caught the valuer just as he was leaving. “He was only prepared to give a preliminary figure that day but what he said was a bit of a surprise,” she recalls.
“He said the house was valued at $260,000 – much lower than we thought. We knew property values hadn’t changed much in Beenleigh recently, but this was close to our original bank valuation of $255,000 in 2008… Disappointment doesn’t even describe it.”
Paulson isn’t alone. After experiencing a once in lifetime flood, during a once in a lifetime recession, growth in property values across many Brisbane suburbs have remained dead-flat over recent memory. It’s a feeling that’s frustrated a lot of investors, who would have, in the past, seen Australia’s third biggest city as one of the better markets for investing.
That there are plenty of investors just like Melissa and Dave Paulson who have not seen recent capital growth speaks volumes about what is happening in Brisbane property markets.
“Five years ago, Brisbane and some of Queensland’s coastal areas were doing very well, now it’s the opposite,” says PRD Nationwide research analyst Aaron Maskrey.
“Some of those coastal markets have been having a tough time since the GFC, and Brisbane, to a lesser extent, has struggled too. We’ve also been seeing a lot of job shedding from the new State Government, which has contributed to city unemployment figures that are already higher than much of the state. This has meant confidence levels remain very low.”
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