Brisbane's median property price surpasses $800,000 for first time

In February, Brisbane experienced another month of positive price growth in the housing and unit markets driven primarily by units and affordable suburbs.

This marks the 12th consecutive month of such growth in Brisbane, with houses seeing a rise of 15.7 per cent and units up by 14.8 per cent over this period. This shift in values is significant, ranking second only to Perth in terms of market growth performance among all capital cities in Australia.

In recent months, Brisbane has consistently surpassed the national average for growth on an annual, quarterly and monthly basis, indicating the enduring strength of its fundamentals. Moreover, Brisbane remains among the top three performing capital city markets across the country over the same recorded time periods.

Although month-on-month growth remains positive, the pace of price increase in Brisbane is gradually slowing, albeit slightly.

This contrasts with trends observed in other markets across Australia, where the broader CoreLogic national Home Value Index (HVI) reported an acceleration of growth in February compared to January.

One factor contributing to the ongoing upward pressure on prices in Brisbane is the low volume of listings throughout the city, which is well below the long-term average.

Brisbane buyers have approximately 40 per cent fewer properties listed online and available for sale compared to the long-term average. Furthermore, total listings in Brisbane in February were down by 15.7 per cent compared to the same period twelve months ago, according to SQM Research.

Looking on the bright side, newer listings saw a 7.6 per cent increase throughout February compared to the same period last year. There was also a notable uptick in new property listings for buyers to consider throughout February, compared to January.

This isn’t unexpected, as many sellers opt to hold off listing their properties too early in the new year. Instead, they prefer to wait until school holidays have ended and most people have settled back into their usual routines.

According to Apollo Auctions data, the average auction clearance rate in Brisbane was 65.8 per cent, with an average of four registered bidders per auction. This marks a significant increase from January, where the average was 2.9 registered bidders per auction. However, the percentage of registered bidders actively participating in each auction throughout February was 56.0 per cent, down from 70.5 per cent in January.

Dwelling values pass $800,000 mark

In February, dwelling values in Brisbane increased by 0.9 per cent. The quarterly change has been 2.9 per cent, showing a progressive slowdown compared to the quarterly growth rate of 3.2 per cent recorded at the end of January 2024 and 3.7 per cent at the end of December 2023. While property values across the city are still rising month-on-month, the rate of growth is decelerating in Brisbane.

For the first time in history, the median value of a dwelling in Greater Brisbane has surpassed the $800,000 mark, currently standing at $805,593. This reflects an increase of $8,775 compared to last month and $26,323 compared to three months ago.

Brisbane currently holds the third-highest median value of dwellings among all capital city markets in Australia. It has now surpassed the national average median dwelling value as well.

The breakdown of dwelling value growth in Brisbane indicates a slowdown in the top end of the market, while the bottom end is now experiencing faster growth compared to other segments.

Properties in the lowest 25 per cent of dwelling values have seen a growth of 4 per cent over the three months ending on January 31st, down from 4.2 per cent over the previous three months ending in December.

The middle 50 per cent of property values are now showing a quarterly change of 3.4 per cent, down from 3.7 per cent the previous month. Meanwhile, the top 25 per cent of property values have grown by 2.8 per cent over the last quarter, compared to 3.5 per cent one month ago.

This data indicates that the deceleration in prices is occurring at a faster rate among the more expensive properties across Brisbane.

With the unit market displaying more strength recently and surpassing the housing market in terms of price growth, it’s crucial to acknowledge the significant role units play in driving the growth of the lowest 25 per cent of dwelling values across the city.

House prices still rising

In February, the median house price in Brisbane saw a further increase of 0.9 per cent, slightly lower than the 1 per cent growth observed last month.

Over the past three months, house prices have risen by 2.8 per cent, indicating a slowdown in the rate of growth across the Brisbane housing market compared to the previous month’s 3.2 per cent, while the previous quarter was 3.8 per cent.

The median house price in Brisbane now stands at $899,474, marking an increase of $10,846 from last month and $28,948 from three months ago. Brisbane ranks as the fourth most expensive capital city market in terms of house values, trailing behind Sydney, Canberra, and Melbourne.

PropTrack data also confirmed house prices in Brisbane showed positive growth throughout February, again outperforming both the national and capital city average on a monthly and annual basis.

Units outpacing house prices

In February, median unit values in Brisbane increased by 1 per cent. Quarterly growth for units in Brisbane is once again accelerating, with a 3.6 per cent increase over the last three months. This is a rise from the 3.2 per cent quarterly growth rate observed last month and the 3.3 per cent growth rate the month before.

The median value of a unit in Greater Brisbane now stands at $576,359, reflecting an increase of $7,764 from last month and $24,027 from three months ago. According to CoreLogic data, this segment of the market has once again begun to outperform the housing market in Brisbane.

Brisbane ranks as the fourth most expensive capital city market for buying a unit in Australia, trailing behind Sydney, Canberra, and Melbourne in terms of median unit values.

Rental market tightens further

Rental market conditions in Brisbane continued to tighten this month, as indicated by a reduction in vacancy rates from 1.2 per cent in December to 1 per cent in January, according to SQM Research.

House rents in Brisbane increased by 7.5 per cent over the last 12 months, slightly higher than the 6.8 per cent growth observed in January over the same period.

Unit rents saw a 12.3 per cent increase over the 12 months leading up to February, slightly lower than the 12.6 per cent growth recorded up to the end of January.

Gross yields have marginally decreased to 3.6 per cent for Brisbane houses, down from 3.7 per cent last month, while remaining unchanged at 5.1 per cent for Brisbane units compared to last month.

Brisbane price outlook still buoyant

The demand in various areas throughout Brisbane remains strong, yet buyers are increasingly exercising caution regarding pricing.

This trend is apparent as the pace of price escalation has been slowing down for several months.

There’s considerable frustration and uncertainty regarding property values across Brisbane, attributed to the rapid surge in prices over the past year. Many buyers are experiencing fatigue as they consistently face stiff competition in the market, leading to missed opportunities.

While prices are still on the rise, it’s anticipated the pace of this growth will continue to slow down in the coming months.

Any potential reduction in official interest rates within the year might reignite buyer interest by increasing borrowing capacity.

Due to the fact that Brisbane’s property prices have outpaced those of other major capital cities across Australia in the past year, affordability challenges may become an issue for some buyers, particularly in areas where household incomes are stretched thin.

Despite this, the underlying dynamics of low supply and high demand in the current Brisbane market suggest that upward pressure on prices is likely to persist for now.