The Brisbane market is showing meaningful improvement and appears
ready for a long overdue boom. Every statistic that matters depicts
uplift in the Brisbane market and prices are expected to rise in 2020.
Many commentators have forecast a Brisbane boom in recent years,
though many were simply assuming that the Queensland capital would
follow the lead of Melbourne and Sydney. Brisbane, however, has lacked
the core growth drivers that boosted markets in the two biggest cities.
But, increasingly, growth parameters are lining up for Brisbane.
Population data is favourable, the affordability comparison is helpful,
surveyed investors say they are targeting Brisbane – and the major piece
of the puzzle previously missing, infrastructure spending, is starting
to happen.
I have commented in the past: “Brisbane is like a car where the
engine is revving but it can’t move forward because the handbrake is
on.” Perhaps the handbrake has been released – a growing number of
analysts are tipping good price growth in Brisbane this year (including
Domain, BIS Shrapnel and Westpac) and I tend to agree.
My Autumn 2020 survey of sales activity reveals 37 suburbs with
rising buyer demand, the second best result for Brisbane in the past
three years – and almost double the number six months earlier. There has
also been a marked decline in the number of problem locations (those
classified as declining or danger markets).
Vacancy rates continue to improve, though there are still areas of
weakness, and 43% of Brisbane suburbs have delivered annual growth in
their median house prices, including double-digit uplift in the
strongest areas.
There is particular strength in the northern suburbs of Brisbane –
the Brisbane North precinct and the Moreton Bay LGA jointly account for
21 of the 37 suburbs ranked as rising markets. The southside has many of
the struggling markets and Brisbane’s inner-city, while improving,
still has its problems.
The Brisbane North precinct and its neighbour Moreton Bay Region are
the standouts, as they have been in our surveys in the past.
Brisbane North has 13 suburbs classified as rising markets, another
24 suburbs with steady sales activity and none ranked as declining or
danger markets.
The uplift in sales activity is producing solid price growth in many
of these suburbs, well above the average for the Brisbane metro area.
Kedron has recorded annual rises in its median prices for both houses
(up 6%) and apartments (up 11%), while Windsor is up 22% for houses and
6% for apartments.
Newmarket’s median house price is up 16%, Northgate has risen 14%,
while Stafford, Nudgee and Geebung have all increased between 6% and 8%.
The Moreton Bay Region LGA has regularly been the best-performing
Brisbane market, boosted by affordability, good infrastructure and
proximity to employment nodes. It’s been overtaken by Brisbane North in
the latest survey, but remains a significant market.
The February 2020 opening of a new university campus will boost
demand in nearby suburbs like Petrie and Lawnton (Petrie is already
rated a rising market and is likely to get stronger as the campus effect
clicks in).
Other precincts have some growth markets: Brisbane-east,
Brisbane-south and Brisbane-inner each has four suburbs with rising
sales activity. Currently these are out-numbered by plateau markets, but
I expect that to change as the year rolls on.
The Brisbane-inner precinct is a confusion of suburbs with
contrasting rankings: the 22 ranked suburbs in my Autumn 2020 survey
include 4 rising, 7 plateau, 1 consistency, 7 declining and 3 danger.
The danger markets (Albion, Fortitude Valley and Kelvin Grove) are those
where sales activity has dropped markedly, prices are down and vacancy
rates remain high. This, however, is an improvement – 18 months ago the
Brisbane-inner precinct had 12 suburbs classified as danger markets.
It’s noteworthy that many of the Brisbane locations with solid median
price growth in the past year are situated towards the upper end of the
market. They include Hamilton ($1,560,000, up 11%), Balmoral
($1,050,000, up 7%), Indooroopilly ($950,000, up 12%), Newmarket
($950,000, up 16%), Rochedale ($1,035,000, up 7%), Sherwood ($935,000,
up 7%), Toowong ($890,000, up 10%) and Windsor ($940,000, up 22%).
Inner-city Highgate Hill stands out with good median price both for houses (up 8%) and apartments (up 10%).
Usually, up-cycles in capital city property markets begin at the top end and ripple out from there.
TERRY RYDER
