Migration inflow and affordability bring welcome demand to the Brisbane market, supported by decreased building approvals
Brisbane’s inner city has been tapped as a market facing oversupply, but things could be looking up for this area due to the quick action of the state government.
“The state government saw this trend early last year and in turn have pulled back on building approvals,” reports Jordan Navybox, general manager at Cohen Handler Queensland. Brisbane recorded the lowest number of building approvals among all the capital cities, which could be easing buyer fears. As a result, vacancy rates have begun stabilising, and rental yields are back up to snuff in the inner city, indicating that the rental market is recovering, to the relief of investors. As a result, this may be a good time to look into this market while there’s an opportunity to buy at below-market prices.
As Brisbane’s improving long-term prospects draw more eyes to its apartment market, houses continue to flourish, especially those located around 10km from the CBD. Such properties can be purchased in the sub-$600,000 price range, and offer average returns of over 4.5%. A little to the south, the Gold Coast has also been recording considerable growth in the past year.
“We put this down to how affordable the market is, but also the upcoming Commonwealth Games, which have created a lot of jobs for the area and also appeal for the region,” Navybox says.
In addition to affordability and falling stock, Brisbane is benefiting from an upswing in the incoming population – it is the second-fastest-growing capital city in Australia, according to recent Census data.
“Queensland has now produced five consecutive quarters of interstate migration in excess of 3,000 people,” says Simon Pressley, managing director of Propertyology.
The interstate migration levels in the June 2017 quarter were the highest recorded in nine years, as many investors from the south have been coming in to try their luck in this affordable market with increasing upside.
Infrastructure projects are also in the works to further enhance Brisbane’s appeal, such as the Queens Wharf project. This entertainment hub, situated in the heart of the Brisbane CBD, is expected to serve as a counterpart to Darling Harbour and the Crown precinct in Sydney and Melbourne, respectively.
“With 50% of the state’s population spread across a dozen major regional centres, Propertyology has observed signs of green shoots in strong cities such as Cairns, Townsville, Toowoomba and Beaudesert, where their respective economic outlooks have improved and housing remains exceptionally affordable,” Pressley says.
SUBURB TO WATCH
WHITFIELD: Far North Queensland suburb soars
Situated 5km north of the Cairns CBD, the suburb of Whitfield appeals to families and young professionals. It is near the Cairns Botanic Gardens and Mount Whitfield Conservation Park, and the recently expanded James Cook University and the popular Northern Beaches are also close by.
The area is set to benefit from “an expanding international airport and deep-sea port”, explains Simon Pressley, head of property market research at Propertyology.
“Cairns is Australia’s gateway to Asia, and the infrastructure pipeline in Australia’s 16th largest city is significant,” he says. “For the year ending May 2017, Cairns’ job numbers increased by 6.3% – three times better than the national average.”
Employment: Jobs are up 6.3%, three times the national average
Airport: Cairns Airport has been recently expanded and is located nearby