Return To Boom Times Coming
Andrea Macleod, Quest Newspaper
Brisbane’s apartment market is on the cusp of change with the next few months set to showcase a whole new direction for the sector experts say
It’s been more than a decade since there was strong growth in apartment prices in Brisbane now experts say that’s about to change.
SPACE Projects analyst and Director Adam Gray said there was no doubt Brisbane was witnessing a strong shift in apartment buyer confidence.
“In 2008 we woke up and realised we’d had our four or five good years but we’re seeing signs of that confidence returning again,” Mr Gray said.
He said suburbs with villages or “honey pots” like Ashgrove, Wynnum, Indooroopilly, West End and Nundah were likely to see the growth that comes from having well-located amenities and transport infrastructure.
SPACE Projects has also identified Fortitude Valley, East Brisbane, Annerley, Alderley, Wilston and Ascot as growth areas in inner Brisbane.
Mr Gray said Brisbane was facing an undersupply of apartments across the city which would lead to price increases.
“One of the measures for an oversupply or undersupply is activity in the rental market and right now vacancies are reducing, sitting under three per cent, and rents are growing,” Mr Gray said.
“There are areas that probably still have enough apartments for sale and vacancy is higher, but there aren’t many now, and in particular, some of the further out suburbs are definitely in undersupply.”
Mr Gray said people looking for an apartment should buy now because “in six months’ time it will be more expensive, and in 12 months’ time it will be even more expensive, as prices continue to rise”.
“I know even in one month’s time, if you buy the same apartment it will be dearer.”
He said outer suburbs like Wynnum were seeing strong demand from retirees and “projects were catering to owner-occupiers”.
“Brisbane has good interstate migration and jobs growth, and with the difference in price between here and Melbourne and Sydney, people from down south are saying ‘maybe I should move to Brisbane’ – and it’s happening.”
“Buyer interest in SPACE Property’s Wynnum The Lane Residences reflects new confidence in apartment market. Photo. supplied
The shift in absorption of stock in the Brisbane Local Government Area (LGA) unit and townhouse market was also recorded in data collected by the Real Estate Institute of Queensland (REIQ).
The Institutes’ Queensland Market Monitor reporting on the June 2019 quarter says Brisbane agents were seeing “signs much of the available stock is being absorbed”.
“Owner-occupier designed units are finding appeal with buyers as well, helping bolster the overall status of the attached housing sector,” the report says.
The data shows unit prices fell 0.6 per cent over the period to a quarterly median of $430,000 across 1369 transactions and over the past year, the annual median unit price fell 2.2 per cent to $440,000.
“Despite this, Brisbane remained the state’s second most expensive market for units behind Noosa ($575,000),” the report said.
“The most active price point was for sales between $350,000 and $500,000 where approximately 37 per cent of all units traded during the quarter.”
The report said the value gain for units over the “past half-decade was just 2.3 per cent”.
In addition the data indicates stock on the market tightened from 7.1 per cent in 2018 to 6 per cent in 2019 and “these metrics bode well for absorbing the lag of oversupply”.
