Experts reveal the Brisbane 'burbs about to boom

Brisbane’s property market has never been hotter, so we talk to the experts to find the suburbs set for the biggest price growth in 2021, as the Queensland continues to solidify itself as Australia’s most sought-after capital city.

As changes in property fortunes go, there’s been no modern day Australian equivalent turnaround that compares to the past 12 months.

Early in 2020, property commentators were declaring house prices across Australia could plummet by 20 per cent, while the Commonwealth Bank stated that five to seven per cent declines in Brisbane could be possible in the short term.

Today’s commentators are predicting a complete reversal, with ANZ expecting Brisbane prices to jump by 9.5 per cent and AMP tipping 10 per cent gains.

Dean Yesberg, principal of Ray White Brisbane City, told Australian Property Investor Magazine the reversal in fortunes was like something out of a movie.

“If you had asked back in March 2020, when COVID-19 first struck, whether the real estate market would be where it is today, we’d have borrowed from the immortal words of (fictional suburban dad) Darryl Kerrigan from The Castle and said, ‘Tell ‘em they're dreamin’,” Mr Yesberg said.

Describing the switch from prophets of doom to pundits of boom as “amazing”, Mr Yesberg said Brisbane real estate, like in much of Australia, was now being driven by “low interest rates, lack of housing stock, 400,000 expats coming back to Australia looking for a place to live, and unspent overseas holidays money being diverted to upgrading or moving to lifestyle properties, whether rural or on the coast.”

Real estate experts shared their opinions with API Magazine on the suburbs expected to capitalise on this market buoyancy and some of the factors driving the sudden and unanticipated market resurgence. 

Population and projects

Price growth in the Brisbane property market was being driven by undersupply, positive migration and shifting lifestyle priorities, according to Paul Barratt, Managing Director, CBRE Residential Projects Brisbane. 

Projects with a bayside or coastal flavour, but well positioned for accessibility to the city, are seeing a surge in demand, he said, naming Redcliffe as a standout in this regard. 

Naming the three suburbs worthy of closer investment attention over the course of 2021, Mr Barratt said areas with growing populations and new projects were the places to watch. 

Kangaroo Point: “This will be a big participant in the next cycle - a lot of the development of the 1980s and ‘90s set a tone for the suburb’s riverfront precinct, however, over the previous decade modern additions have started to creep back from the water and along the river reach,” Mr Barratt said. 

“One or two key developments will set a new benchmark for inner city living in this quiet but super conveniently located suburb, which is the first suburb to benefit from the new Green Bridges project by Brisbane City Council and soon to be linked directly to the Brisbane CBD and Botanic Gardens by a pedestrian and cycle bridge.  

“This will enhance the popularity of this suburb for working professionals and university students alike.” 

South Brisbane: “It’s presently the fastest growing suburb in Australia and it is starting to benefit from new bars and cafes opening and thriving.  

“The Fish Lane precinct is going from strength to strength, with Aria’s Town Square development turning redundant tarmac under the rail bridges into a tropical oasis literally on the doorstep of Queensland’s Arts Precinct and the CBD.  

“South Brisbane will welcome another 500 residents in June this year with the settlement of the stunning extension to Fish Lane, The Standard.  

“As such, the offering of the precinct is flourishing with awarded bakeries, restaurants and incredible lifestyle offerings, such as the brand new Pilgrim Hot Yoga Studio, meeting the demands of a youthful, energetic population with high disposable income and a desire to enjoy a balanced life in a vibrant suburb.  

“There is virtually no dwelling vacancy and demand is exceeding new supply.” 

Spring Hill: “It recently went through an extensive local and state government planning review and this is likely to bring new mixed-use and residential development into the precinct. 

“The new Australian Tax Office under construction in Wharf Street will increase the working population of the precinct and relatively low rents and genuine walkability to the CBD mean Spring Hill is overdue for a facelift, and with the calibre of developers jockeying for sites in this suburb we are likely to see the overall amenity and architectural merit of the suburb lift significantly over the next cycle.” 

Robust middle ring  

In nominating his potential hotspots for 2021, Ray White’s Mr Yesberg said the middle ring suburbs 10 to 15 kilometres from the CBD, with good transport schooling and shopping infrastructure, were the best prospects for good growth on all four points of the compass.

South: “Mansfield, Wishart and Mount Gravatt; these areas have a median price of between $600,000 to $700,000 and have easy access to education hubs, transport, shopping and hospitals,” Mr Yesberg said.

East: “Murarrie and Hemmant; on the train line, great schools, affordability, and close to the lifestyle areas of Bulimba and Camp Hill. In Hemmant, you have a good mixture of old and brand new houses.

It also provides a high quality of life, being close to the bayside suburbs of Wynnum and Manly.

North: “Mitchelton, Stafford and Everton Park; older working-class suburbs that are more affordable than their ritzier neighbours. There are larger blocks with plenty of renovations going on in the suburbs. They have good proximity and easy transport options to the city and to the south and Sunshine Coast.

West: “Chapel Hill and Kenmore: older established suburbs with large homes on good-size blocks with plenty of opportunities to renovate. There’s good infrastructure with shopping, schooling and a sense of community and good family areas.”

Relative affordability

A recently published report by Brisbane mortgage brokers Hunter Galloway said the property market in Brisbane was set for a strong start in 2021 thanks to a few major projects, like Queens Wharf, Howard Smith Wharves and very strong housing affordability compared to Sydney and Melbourne. 

Of the nation’s major capitals, only Canberra and Perth are more affordable than Brisbane on a price to income basis, with Sydney’s unaffordability more than double that of Brisbane. 

Greenslopes, around five kilometres south-east of Brisbane, is a suburb to watch in 2021, according to Hunter Galloway, being close to the city with a median house price of $720,000 and great access to public transport. 

They identified Strathpine, Ferny Hills, Kedron, Oxley and Caloundra as other suburbs worthy of a blip on the savvy investor’s radar. 

Rent rearing 

In the midst of Brisbane’s lockdown months in the middle of last year, rents in many suburbs were slashed by around 30 per cent.  

Analysis by Domain showed recently that apartment rents had started to rise in Brisbane and, for the first time in five years, it was now more expensive to rent a unit there than in Melbourne. 

Brisbane house and unit rents continued to reach record highs, with median asking rents of $425 and $400 per week respectively. 

Mr Yesberg said the local rental market was still “two-speed”, with houses experiencing low vacancy rates and inner city apartments still hampered by the lack of international students and corporate visitors. 

“Rents in the inner city unit market are slowly starting to rise but are still not back at pre-COVID rates,” he said. 

“With a lack of new development coming on board we do believe that rents will climb back to where they were and for the investor the unit market is where we see good value, with yields above 6 per cent compared to 4 per cent for houses.”  

Mr Barratt said the rental market is incredibly tight, dropping from 4.2 per cent to sub 2 per cent in key suburbs.  

“As an investor, I would be looking at amenity and infrastructure uplift in suburbs where long term resident rental demand is not subject to seasonal variations and they are less exposed to the highs and lows of corporate or holiday letting.”