The second week of May saw values in Brisbane lift by 0.1%, adding to the sun-swept capital’s 0.3% growth in April, as per CoreLogic’s Home Value Index.
Off the back of restrictions however, CoreLogic reports that auction clearance rates have taken a more immediate hit – currently sitting at 25%, in comparison to 40% for the previous year; also keeping in mind that the number of properties on auction are also comparatively lower.
Despite the sweeping effects of the health crisis, REIQ’s quarterly report reveals that rental vacancies across QLD came in at 2.44%, accounting for a 0.1% rise from the previous quarter. CEO of REIQ, Antonia Mercorella, says that Brisbane’s vacancy rate, which pulled back by nearly 1%, is “indicative of a fairly stable market”.
“Across Brisbane, vacancy rates have remained tight which is a great reflection of a healthy market albeit some more pronounced fluctuations within the apartment sector will inevitably be expected in future data,” Mercorella says.
According to Herron Todd White’s residential report for May, agents have been reporting that sales values ‘continue to be at pre-pandemic values’ but there have been fewer new listings coming onto the market.
“Lack of stock usually means firmer prices, but in this instance, what’s available might indicate a seller eager to offload their asset,” the report notes.
Construction needs a boost
Queensland's construction industry might not be in the best shape to handle the impact of the COVID-19 outbreak, based on its housing market and the economy.
According to Real Estate Institute of Queensland (REIQ), total dwelling approvals in the state have dropped by 1.8% in March, partially driven by the halt in immigration.
While Australia overall is starting to recover from last year’s slump in approvals, Queensland has failed to keep up. On an annual basis, dwelling approvals across Australia grew by 1% — the state, on the other hand, experienced a decrease of 7.8%.
Paul Bidwell, deputy chief executive officer of Master Builders, says the state's residential sector lacks the strong foundations necessary to face the potential risks of the COVID-19 outbreak.
“The 12-month total of dwellings in Australia isn't far off the post-GFC low point — and that's without the impact of COVID-19, which we don't expect to really begin to hit until August or September 2020,” he says.
Mike Roberts, executive director for Queensland at the Housing Industry Association (HIA) economic stimulus is crucial to ensure the security of the residential building industry that employs over 200,000 people.
“The long lead times associated with building a home means that stimulus is required now to lessen the impact later in the year,” he says.
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