Adam Empringham,
Director of Sales at Image Property.
Five reasons why the Southeast Queensland market is still full steam ahead
[lwptoc]Southeast Queensland continues to record superior market metrics, while our two biggest capital cities continue their market downturns further south.
Property prices across the southeast continue to be robust, with healthy auction clearance results, as well as constrained supply levels, more affordability price points, and rising rents, all highlighting why our region’s market remains full steam ahead.
Number one
According to the CoreLogic Home Value Index for May, the Brisbane median house value has produced the strongest annual growth of all capital cities across the nation.
Over the year ending May, the median house value in Brisbane has risen by 30.2 per cent to about $885,000 – while Sydney and Melbourne’s house prices have been falling since the start of this year.
Auctions remain robust
Likewise, according to the Apollo Auctions May Auction Report, the auction market in Brisbane remained strong in early 2022, whilst not being at the frenzied levels experienced last year.
However, this adjustment has largely been noticed in a reduction in the number of bidders rather than the quality of bidders, which is an important factor.
Likewise, the Gold Coast market is still in great shape. A rise in interest rates does not seem to have dampened the spirits of buyers or reduced interest, and there is also increased activity from investors.
Affordable property
Even with the strong price growth over the past 18 months, property prices in Southeast Queensland remain much more affordable than in Sydney and Melbourne.
Just consider that the median unit value in Brisbane is about $498,000 in Brisbane, but in Sydney, it is about $830,000, according to CoreLogic.
The Brisbane median house value remains about half a million dollars more affordable than the equivalent in Sydney as well.
Supply still remains low
One of the main reasons why the southeast (and elsewhere around the nation for a time, too) has experienced such a strong uplift in property prices was the historically low supply of listings over the past two years.
However, stock levels in Sydney and Melbourne are now above the five-year average, but the same can’t be said for Brisbane.
According to CoreLogic, Brisbane’s stock levels are 38 per cent below the five-year average, which will continue to put upward pressure on prices.
Rising rents
The southeast’s rental market continues to be significantly undersupplied, with vacancy rates at or near record lows in Brisbane and the Gold and Sunshine coasts.
With vacancy rates below one per cent, rents have been rising strongly due to this property supply versus tenant demand imbalance.
According to CoreLogic, the annual change in house rents in Brisbane was 12.8 per cent over the year ending May – the highest capital city result – while the annual change in unit rents in the River City was 8.1 per cent.
This upward pressure on rents is set to remain for the foreseeable future, which is set to attract more investors to our region.
