"Real estate in QLD has seen significant growth over the past 2 years with some more predicted to rise." - Matthew Lapish, Senior Investment Analyst
A new report that predicts where the next big price moves will be based on how property sales are tracking is showing surprising winners and losers across Queensland.
The Price Predictor Index, which tracks sales volume spikes to predict future price gains or falls, has named the once maligned inner city Brisbane apartment market as one of the capital region’s top risers, along with the more affordable parts of Ipswich, Logan and Moreton Bay – with the Queensland regions also now set to shine.
Index author veteran market analyst Terry Ryder named regional Qld among eight markets that were winners nationwide, with Toowoomba, Townsville and Rockhampton all making the Top 10 Municipalities list.
“There are stories within stories,” he said of the Qld market. “Brisbane was dropping ahead of the interest rate rises but there are sections that are still very strong – inner city suburbs still are classified as rising markets in this report and that’s because of the apartment theme.”
“The outer areas like Ipswich, Logan, Moreton Bay are still very strong because they offer affordability.”
Despite 99.5 per cent of the capital’s suburbs seeing median house price growth in the past 12 months – about half of which was over 30 per cent – Brisbane has seen a dramatic fall in suburbs classified as rising or consistency markets. It’s dropped from 180 nine months ago to 135 suburbs now – of which 96 were considered to be “rising”.
“The market has passed its peak, but remains at levels much higher than historic norms,” the report said. “In the six years prior to 2021, the average number of rising markets in our quarterly surveys was 42 – so the numbers in the latest survey are more than double that average.”
Mr Ryder said “regional Queensland generalised looks like they’re down a little bit, but what’s actually down is the Sunshine Coast, which has been strong for three years but no longer. It’s fading after three years of boom.”
“If you remove the Sunshine Coast and the Gold Coast from the figures, the rest of regional Queensland is really looking very strong. Regional centres like Toowoomba, Townsville, Rockhampton, Gladstone, and Mackay they’re really pumping still, and they would be attracting a lot of investor buyers – if they weren’t currently being scared off by the land tax changes, which are really very onerous.”
The national top 100 supercharged suburbs include 37 in Qld, six of which are in the Greater Brisbane region – Brisbane City, Chermside, Redbank Plains in Ipswich, Eagleby in Logan, Dakabin and Griffin in Moreton Bay.
According to the analysis, Brisbane City units have not hit their price peak yet and were nowt seeing over 200 sales every quarter in the past year, around double the sales levels of the year before that.
PPI research found it could take as much as six months for spikes in sales activity to translate into higher prices for suburbs. “A significant rise in sales activity leads to a rise in prices, but with a time lag,” the PPI found. “It takes time for the market to react, price-wise, to a new situation. An uplift in sales volumes may lead to an increase in median price levels six months later”.
Regional Qld has a strong showing in the supercharged suburbs list with Townsville, Rockhampton and Gladstone all holding five suburbs in the national top 100, and Cairns showing two. Those areas seem to have been a strong focus among buyers agents this year for interstate and international buyers.
Brisbane-based property advisor PK (Pulkit) Gupta, who owns 12 properties himself – four of which are in Brisbane, one on the Gold Coast and one in Cairns – agreed that affordability and high yields would see parts of Brisbane and regional Qld rate highly among investors.
“At the beginning of 2021 you could throw a dart at a map of Brisbane map while blindfolded and you would have hit a growth location. But things have changed. Now it’s not should I buy in Brisbane, but where and what should I buy,” he said.
“I think the better opportunity is in the townhouse dwelling types, not so much in the inner city but 10km to 15km north and south of the river, places like Clayfield, Northgate, Taigum. I think they will outperform units because of their land component. Land is scarce. In four to five years a lot more cranes and units might come up again, but townhouses will hold their own.”
He said in suburbs like Oxenford on the Gold Coast you could still buy a townhouses around the $500k mark, with prices set to continue to rise due to very low vacancy rates.
In regional Queensland there was a similar situation, he said, with “suburbs like Frenchville – where you can buy property under $400k with 6 per cent rental yield”.
“It’s hard to knock that back especially if you live in Sydney,” he said. “Because of the flight to yield, and the flight to affordability, there’s very little chance that the few suburbs that are still affordable won’t go up. Buyers are flocking to those suburbs.”
Mr Gupta said interstate buyers viewed property prices in Qld as “absolute bargains” and not even the land tax was likely to stop that.
“Some markets are still at the start of their growth cycle for certain types of properties, so the long-term upside is excellent.”
Supercharged Qld suburbs in Top 100:
Brisbane: Brisbane City, Chermside
Bundaberg: Bundaberg North
Cairns: Cairns City, Edmonton
Central Highlands: Blackwater, Emerald
Gladstone: Calliope, Clinton, New Auckland, Tannum Sands, West Gladstone
Gold Coast: Nerang, Oxenford
Ipswich: Redbank Plains
Isaac: Moranbah
Lockyer Valley: Gatton
Logan: Eagleby
Mackay: Hay Point, South Mackay
Moreton Bay: Dakabin, Griffin
Murweh: Charleville
Rockhampton: Allenstown, Frenchville, Gracemere, Kawana, Norman Gardens
Toowoomba: South Toowoomba, Wilstonton
Townsville: Douglas, Kelso, Kirwan, Mount Louisa, Townsville City
Western Downs: Dalby
Whitsundays: Bowen
Source: Realestate.com.au