Brisbane Property Market Update September 2020
Our Sunshine State capital is looking even brighter as at the time of writing.
While we’ve had our challenges during COVID-19 (particularly in recent weeks when a few dubious border crossings have left our population holding its collective breath in anticipation), all-in-all we would dub recent virus prevention efforts successful.
Minor transmission numbers coupled with our lower-density population (compared to Sydney and Melbourne) have combined with our temperate climate to make this an excellent place to be during 2020.
We have restrictions of course, but none as limiting as those being experienced down south. That means our economy is chugging along at a maintainable pace for now and it’s bringing confidence with it for the ride.
This also means the business of buying and selling real estate has remained relatively unscathed too. Open homes, auctions and the general operation of real estate trading has continued.
The outcome? There has been an improvement in market conditions and many sources are reporting similar levels of activity to those experienced prior to the commencement of the pandemic, with good levels of enquiry and demand evident. There’s even been some price growth experienced due to firm underlying demand and limited stock/listings available.
So, what does this mean for our pending spring selling season?
Well, the news remains upbeat. Agents have said they’re registering solid numbers at open homes and multiple offers on properties isn’t an unusual event. The limited listings that do make it to the web portals aren’t sticking around for long. If this level of demand keeps up (and indications are that it will), then we may well see spring and summer seasons that are more impressive than may have been expected just a few short months back.
Of course, it should come as no surprise that the Sunshine State flourishes during spring. We are absolutely built for the season. South-east Queensland blooms as the weather warms and homeowners are keen to show off their properties at their best.
Another element to factor in during spring this year is the potential drive from southern buyers looking to elevate their lifestyle (and freedom) by moving to Queensland.
The growth in remote work arrangements coupled with our low infections will potentially bring more residents across the southern border to set up a life here.
This will build upon the pre-COVID-19 increase in Queensland’s net interstate migration. We were watching a rise in the number of new Queenslanders moving up here year-on-year until the end of 2019. There was an expectation that Brisbane’s market would have seen a jump in pricing on the back of this growing population in 2020 but, of course, the pandemic put a stop to this.
What Brisbane suburbs will be worth watching as spring looms?
For starters, markets with evergreen fundamental drivers should prove strong. Many inner localities have already shown some value gains and have seen shorter selling periods this year due to limited listings and firm underlying demand. Demand for quality homes in good locations will remain excellent and may even ramp up as non-local buyers look to invest here.
But we are also expecting stronger results in traditional mid-ring family locations too – suburbs where blocks are a little larger and homes more spacious, but where there is also easy access to major facilities and transport routes. Think areas such as Chermside, Mitchelton, Nundah, Wooloowin, Morningside and Yeronga.
An example might be this home at 121 Northmore Street, Mitchelton. Sold in July for $620,000, it provides three-bedroom, one-bathroom, two-car accommodation on a 405 square metre site with ready access to retail facilities and train. A very solid real estate option.
Good school-zone driven family locations could also fare well. Think suburbs such as Ashgrove, Ascot, Indooroopilly, East Brisbane, Woolloongabba and West End. Home quality is mixed, but if you have ready access to some of our city’s top schools, then there are buyers keen to get in.
A good example would be this home at 59 Mirrabooka Road, Ashgrove which sold in June for $1.03 million. It provides five-bedroom, twobathroom, two-car accommodation with pool and landscaped gardens on a 604 square metre site within an easy walk of both Marist College and Mount Saint Michael’s private schools.
Another area of the market which can look forward to spring selling season is the vacant land and new home construction sector.
Sales were strong for vacant sites and houseand- land packages throughout June, July and August following the announcement of the Federal HomeBuilder stimulus package, with many developers reporting an increase in sales rates and volumes. Renovations have also become more popular in response to the stimulus.
The one sector we continue to be wary of is new unit construction, particularly those designed to appeal to investors and tenants. This property type experienced overbuilding in the inner-city and was a favourite option for student and shortstay residents. While we were on track to see the oversupply absorbed prior to COVID-19, the virus has now taken a chunk of the potential renter base out of the market, so yields are softening. There is probably still some pain to come for these particular landlords.