The Brisbane suburbs poised to boom
History has shown that host city property prices rise in the years leading up to the Olympic Games, and Brisbane's current turnaround may be the start of a more sustained real estate uptick.
Faith in the 2032 Olympics’ ability to push Brisbane property values ever higher is backed by past host- city data which, in Sydney’s case, shows property values leapt 60 per cent from its 1993 bid win announcement up to the Games’ start in 2000.
On the same trajectory, Brisbane is nine years out from lighting the Olympic torch and already in the throes of new investment in infrastructure, roads and public transport networks.
On hearing about Brisbane’s win, Besa Deda, Chief Economist, Westpac Business Bank, said there could be $17 billion of economic and social benefits for Australia, with around $8 billion of that flowing into Queensland.
“Most people think the Olympics will attract more international migration to Brisbane because we’ve always had a lot of interstate migration from Melbourne and Sydney coming up, but not many people come directly from overseas, so the hope is that international immigration will increase property prices,” Scott Thomas, Head of Operations, Belle Property Brisbane, told Australian Property Investor Magazine.
“The government is redeveloping the Gabba, which will be the main Olympic stadium, but they’re also creating a new sports precinct to the north in Albion, and an underground cross river rail system that goes from Woolloongabba to the city.”
The Brisbane Council in late 2022 announced the Breakfast Creek Sports Precinct would cover a 29-hectare area adjacent to a new state government indoor sports centre, in preparation for the Olympics at Albion.
Mr Thomas said Woolloongabba, which is home to the iconic Gabba, is a suburb to watch, along with Camp Hill and Coorparoo, because of new developments and the rail system connecting the east Brisbane suburbs to Brisbane city.
“In all of those areas the rents have jumped up a fair bit because there’s lots of warehouses that have been rebuilt there, either as new builds or renovations, plus the lifestyle in those areas is good and they’re prestigious locations,” Mr Thomas said.
‘Incredible’ rental returns in Queensland capital
Rents in Brisbane are on the rise.
CoreLogic’s Home Value Index (HVI) indicated gross rental yields on Brisbane apartments are at 5.4 per cent, that median unit rent is $533, with a year-to-date change of 4.6 per cent and a year-on-year change of 16.5 per cent.
The current vacancy rate in Brisbane is 0.7 per cent, down 0.3 per cent from 2022.
The HVI data lists Brisbane suburbs with the highest 12-month rental growth, topped by the $739 per week for Brisbane Inner – East. Also on the list are the Brisbane CBD, Ipswich, Redcliffe, Forest Lake, Nathan, Nundah, Mt Gravatt and North Lakes.
“There has also been a big jump in smaller units; two-bed, one-bath, and those properties are up quite dramatically, and returns are quite good as are three-bedroom dwellings, which are doing quite well because of the extra space people want, so they can work for home, or have a little bit of extra getaway area while they are working from home,” Mr Thomas said.
Alan Gardner, Investment Manager, First National Style Real Estate, described the Brisbane rental market as “incredible”.
“There is huge demand on rental properties and in inner city you can get rental yield 6 per cent of net income from apartments and we might see 100 applications for a property when it opens for inspection,” Mr Gardner said.
“Despite this demand there is a perception that some suburbs are a flood risk and that you cannot or should not buy a house in those suburbs, but that is wrong because flooding might only have affected a few streets in those suburbs yet they’re the ones that are close to the Brisbane River where there are water views, city views and higher prices.
“Investors can still find houses in suburbs close to the CBD that are not flood prone.”
Some Brisbane values already lifting
Greater Brisbane dwellings are performing well too, with the highest 12-month value growth suburbs for all Brisbane dwellings being found in Caboolture Hinterland (Moreton Bay – North), up 3.4 per cent, median value $744,965, Ipswich, up 3 per cent, Beaudesert, 2.7 per cent, Jimboomba down -0.8 per cent (median value $812,670),
Other suburbs are not tracking as well, including Springfield (-0.8 per cent), Beenleigh (-1.8 per cent), Brisbane Inner City (-2.6 per cent) and Cleveland-Stradbroke (-3.7 per cent, median value $812,843).
Brisbane dwelling values have fallen in the past 12 months by 8.6 per cent but have shown a small turnaround in the past month of a 0.1 per cent increase (CoreLogic HVI).
By the time Olympic torch runners arrive in the city in 2032, experts and history concur that the increase in property values could be significant.