February 22, 2021 admin Uncategorized Brisbane Property Buyers have been able to look past the consistently negative news and media headlines in relation to property values around the country. Over the last few weeks the news has become a lot more optimistic. Brisbane appears to be the city that is likely to see the most price growth over the next few years. Major Bank economists have updated their property price forecasts this month and they are now expecting possible boom conditions in the coming years. Brisbane has been identified as most likely to out perform the rest of the Capital City Markets around Australia. Westpac’s economists expect Brisbane property prices to surge over 20 per cent between 2021 and 2023. Brisbane buyers Agent Craig Greer-Smith of Networth Property says the report indicates that the recovery is being driven by sustained low-interest rates, improved affordability, ongoing fiscal support from regulators and both federal and state governments and of course a strengthening economic recovery. Some of the major bank lenders in Australia have been less bullish, such as Commonwealth Bank and ANZ, but are now changing their views as it being a good time to buy. Not all property markets around Australia will, of course, recover as quickly as Brisbane is expected to. Local issues of supply and demand will determine local performance. Over the last few months, it has been reported that the Brisbane property market performs in different ways to the Sydney and Melbourne markets. Significant buyer interest from Covid effected states like Victoria are effecting supply and demand and driving upwards property price movements. Brisbane property prices have always been more affordable, with the income to debt ratio a lot lower and the amount of our household income required to service a mortgage here in Brisbane is also a lot lower. This gives us an enormous advantage over the Southern East Coast Capitals. There is already a noticeable surge in buyer interest from Interstate, driven by affordability and the desire for a better lifestyle. The Covid 19 pandemic has definitely caused a significant shift in thinking for a lot of people in where and the way they want to live, and it seems that South-East Queensland may be set to benefit significantly. Brisbane Property Market Prices are rising : According to the latest CoreLogic Home Value Index data, home values in Brisbane saw an overall median monthly price rise of a 0.5 per cent over the month of September 2020. The many dire predictions from many lenders and economists for large falls in value simply did not occur in Brisbane and many property buyers who have been waiting and hoping for the bargains to appear, have been disappointed. In fact, prices in quite a few areas throughout Brisbane have continued to climb. The recent city price data is showing a large divergence between regions where the virus outbreaks have been mishandled and where the virus is well contained. The Melbourne market has been impacted the most with home and unit dwelling values falling a further -0.9 per cent for the month of September followed by Sydney will price falls of -0.3 per cent. These two markets make up approximately 40 per cent of Australia’s housing stock by number and 55 per cent by value so the national reading still shows a fifth straight month of decline with overall values declining -0. In spite of the lock downs and restrictions which made for pessimistic predictions of much larger falls, but is does highlight that areas like SE Qld are definitely less impacted than others during this time. The Brisbane Housing Market actually saw median values for the greater Brisbane region increase 0.4 per cent across the month of September 2020. The current median value for a Brisbane house is now $559,646 and likely to be rising further into 2012 and 2022 The Unit Market in Brisbane which was seen to be oversupplied previously saw a slightly higher median value increase of 0.7 per cent for the month of September 2020. The current median unit price in Brisbane is now $388,505. Source: SQM Research The vacancy risk for investment units is still quite high in the Brisbane inner-city region where there is a large number of higher density unit complexes. Rents in the unit market in Brisbane saw price falls -1.6 per cent from March 31 to September 30. This is a consequence of supply and demand-side factors that are slowing starting to balance out. Patient Buyers are seeing some compelling value emerge in better quality buildings. State and International border closures have definitely reduced apartment demand from interstate and international students as well as short term travellers in Brisbane. Industry sectors like hospitality, the arts and recreational services have been hit the hard by job losses and reduced working hours. Historically people working in these industries are more likely to rent inner-city apartments, which has also negatively impacted on the demand for these investment properties in Brisbane. See below the change in rents for Brisbane Units and Houses from March 31 to September 30 2020. Why are we seeing a surge in interstate buyers using specialist agents to find the right property in Brisbane? There is a continuing increase in the number of buyers looking in the Brisbane market. Many are from interstate and have not been able to inspect properties personally. With the fall out from the pandemic situation and of of course the record low interest rates, buyers are turning to specialist buyers agents to try and secure a property in a market that has turned sharply more positive. Also, the recently announced relaxing of responsible lending laws is likely to see credit availability flowing more freely in the months ahead. It appears that the middle ring suburbs in Brisbane are showing the highest level of buyer demand over recent weeks. This is a combination of first home buyers, investors and families competing for a still relatively small number of properties listings so competition is intense. There are high volumes of buyers at most open homes every weekend now and even mid-week inspections are busy in many suburbs around Brisbane. Selling agents report multiple offers are becoming very common – this includes properties that are not actually listed online. There is sufficient off-market demand from buyers (mainly through Buyer’s Agents) to cause a higher level of competition for new to and off-market transactions. It appears as if 2021 and 2022 are shaping up as strong years for the Brisbane property market.