Brisbane Property Market Update - June 2019
The Brisbane Property Market median house price tipped to increase between 4-6% over the next 18 months. Queensland buyers agent, Melinda Jennison, reviews the current market.
The month of June brought a lot of positive news for property markets around Australia when the Reserve Bank cut interest rates to an all-time low, with a further reduction in July and an expected cut again in the coming months. This, on the back of no changes to negative gearing or capital gain tax policy and the banking regulator changing lending rules that will make it easier for people to borrow money, has all come at the same time injecting a lot of positive sentiment back into property markets around the country.
Following all of this news, Domain have provided House Price Forecasts from now into 2020 with the Brisbane Property Market median house price tipped to increase between 4-6% over the next 18 months. As always, we must remember that Brisbane is not one Property Market and therefore local data needs to be analysed to determine the pockets in Brisbane that are more likely to outperform, compared to others.
The average number of attendees at open for inspections in Brisbane is up 15% compared to before the election which confirms what we have been seeing on the ground with record numbers at some open homes in popular pockets around the city. Whilst this may suggest a turnaround in the local Brisbane market, the latest monthly Corelogic Hedonic Home Value Index shows that the housing market outcomes are still relatively soft in Brisbane with a monthly median value decline of -0.52%.
The latest SQM Research has also revealed that Brisbane has experienced a -4.4% reduction in listing volumes. We would normally find that when there are more buyers in the market than there are properties available for sale, there is likely to be upward pressure on prices, but perhaps the median values are more of a reflection of WHAT is selling around our City because we have certainly been witness to some properties more recently which have sold for higher than expected prices – something that is not reflected in the monthly median values reported by CoreLogic. Or perhaps it is just a more local phenomenon in the locations we are actively buying in.
The latest monthly data still confirms that over the last financial year, 4 areas within Brisbane are still performing within the top ten capital city sub-regions across Australia which is reassuring that things are not as bad as some may seem. A recent media report found that over the last 12 months, 83 Brisbane suburbs recorded annual price growth above 5% (including 20 suburbs with double-digit growth) and another 100 had recorded growth below 5%. This means that 7 out of 10 Brisbane Suburbs have median prices higher than a year ago. As we keep referencing, there are always markets within markets.
Gross Rental Yields in Brisbane are still rising and the latest results show investors can expect a 4.5% return, which is still a lot higher than Sydney at 3.5% and Melbourne at 3.5%. Perhaps this is the reason why there is still so much interested in Bråisbane from interstate investors.
Of course, we still have strong population growth and everyone needs somewhere to live. With the inner city apartment oversupply coming to an end, and construction commencements falling, things are still looking optimistic for Brisbane in the future.