Brisbane has yet to zoom to the top of the market, but it has stayed comfortably in the middle while recording what CoreLogic’s Home Value Index for December 2019 describes as “the strongest growth conditions” among the capital cities, as property values rose by 0.7% over the month.
House price expectations were high for the Sunshine State, according to the 2019 ANZ/Property Council Survey on consumer sentiment, although sentiment was only moderate. The 2019 Property Investor Sentiment Survey conducted by Your Investment Property, Property Update and Onthehouse indicated that, out of almost 2,000 investor-respondents, 37% owned investment properties in Brisbane. Brisbane also outranked Sydney when it came to capital cities with the best potential for capital growth over the next five years.
“The Queensland property market has started to show signs of growth, as CoreLogic reported Brisbane with 2.4% growth in December 2019 compared to the previous quarter,” says Dennis Wong, property data research specialist at Real Estate Investar.
“Over the past 10 years, Queensland has had consecutive population gains each year and achieved the highest average annual gain of 11,600 people. At the end of June 2018, the Sunshine State had a net interstate migration gain of 24,700 people.”
Infrastructure projects have helped pique interest in various areas of the state, and with Queensland long serving as an alternative to Sydney and Melbourne, the price growth seen in these cities has been boosting parts of the Sunshine State. A media release from Ray White Surfers Paradise indicates that the Gold Coast in particular is being eyed by interstate investors who have taken note of this region’s ability to weather the recent downturn as a result of its strong regional economy.
While Domain economist Trent Wiltshire predicts further price growth on the horizon for Queensland, he does warn investors to keep their expectations for the rental market realistic.
“Yields for Brisbane units jumped a little bit, but that was because unit prices have fallen a little bit. I think we’ll see that across the board: yields will start to fall away. Interest rates are heading down – that compresses yields everywhere. And it looks like we’re going to see some price growth, so we will see rents start to fall,” Wiltshire says.
SUBURB TO WATCH
ROBERTSON: A tale of two diverging markets
The suburb of Robertson in Brisbane’s outer ring is an interesting case, as its house and unit markets could not look more different.
Houses sell at premium prices, at a median of over $1m. This market has also been growing steadily over the five years to December 2019. By contrast, the median unit value came in at under $350,000 as a result of consistently falling prices in the same period. However, average unit rental returns are as high as 7.1%, and rental rates have skyrocketed by 12.4% to hit a median weekly advertised value of $478.
Young owner-occupiers dominate this suburb, with families comprising nearly half the population. This could explain the popularity of houses.
Population: The suburb has a large population of owner-occupiers and families
Prices: The median house price is more than $1m, while units are very affordable at under $350k
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