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BRISBANE house prices are continuing to grow, with new figures revealing they have hit a record high for the 26th straight quarter — making the Queensland capital the envy of its cooling counterparts.
The latest Real Estate Institute of Queensland Market Monitor, to be released today, shows the annual median house price within the city’s local government area rose 1.1 per cent in the 12 months to the end of December to reach a new high of $675,000.
The Brisbane LGA median house price has jumped 25.9 per cent since December 2013, when it was $535,000.
The last time the city recorded an annual drop in its median house price was back in December of 2012, according to the REIQ, but it has climbed slowly and steadily ever since.
According to the REIQ, Brisbane’s housing market “continues to be one of the nation’s most consistent capital-city performers”, delivering moderate but sustainable price growth — so far defying the downturn gripping Sydney and Melbourne.
Among the top suburbs for house price growth in the Brisbane local government area were Sandgate, Hendra, Mount Ommaney, Albion and Hemmant.
TOP GROWTH SUBURBS FOR HOUSES IN BRISBANE LGA
Suburb Median price Annual change %
1. Sandgate $750,000 18.1%
2. Hendra $1.115m 14.7%
3. Mount Ommaney $1m 13.8%
4. Hemmant $545,000 13.3%
5. Albion $858,000 13%
(Source: REIQ, based on 12mths to December 2018)
REIQ chief executive Antonia Mercorella said the figures showed Brisbane house values had continued to rise at a time when many capital cities were seeing prices go backwards.
“Because (Brisbane) hasn’t experienced that incredible accelerated growth, we’re not going to have that boom/bust experience that other capitals have.” Ms Mercorella said.
But she said that while Brisbane’s growth had been buoyed by increased interstate migration, improving economic fundamentals and strong demand, its resilience was flagging.
“Brisbane has so far withstood the headwinds facing the property markets in Sydney and Melbourne,” she said.
“Our property market has all the ingredients for a strong performance in 2019, including low unemployment, high levels of infrastructure spending that is creating jobs and high interstate migration levels, which creates demand for housing.
“But what we need is a clear signal from the government that responsible lending doesn’t mean limited lending. Currently, limited access to finance is threatening to stifle the market.”
Ms Mercorella said it was realistic to expect home price growth in Brisbane to be flat for the rest of 2019, but the city had the fundamentals to “really take off” in the near future.
“There are plenty of reasons to be confident and more people are wanting to invest in the Brisbane market because of what’s happening in Sydney and Melbourne,” she said.
“Not only are we affordable, but we offer a good return on investment.”
Ms Mercorella said areas that were most likely to feel the slowdown would be the growth corridors on the outskirts of Brisbane, such as Ipswich and Logan —areas where first home buyers and investors were most prevalent.
“Investors are likely to be the ones facing most of the brunt of tougher conditions in 2019,” she said.
“In addition to a federal election, which always slows activity in the real estate market, there is the threat of looming negative gearing cuts and CGT reforms, plus Queensland investors are also facing the headwinds of a rental legislation review.
“These factors all add up to a potentially very sluggish 2019.”
But buyers’ agents say investors are recognising the growth potential in the Brisbane housing market because of its affordability and lifestyle.
Daniel Walsh, of investment buyer’s agency Your Property Your Wealth, said he had noticed a clear shift in property investment activity away from Sydney and Melbourne to Queensland in the past 12 months.
“Two or three years ago, people were wanting to invest in NSW and Victoria; now we’re seeing them turn to Queensland” Mr Walsh said.
“We had been investing heavily in Victoria over the past two to three years, but yields have started to diminish.
“It’s more attractive in Brisbane in terms of investors seeing greater rental returns and affordability.”
Mr Walsh is forecasting Brisbane to be a standout performer over the next three to five years.
“We’ve had wages increase, job numbers increase, more people are moving to the area and now all these green shoots are showing we’re ready for a boom in Queensland,” he said.
“It’s got all the ingredients for a boom, we just haven’t seen it just yet.”
Over the next six years, the top 10 infrastructure projects in the pipeline are forecast to inject $17 billion into the city and result in significant job creation.
Tourism is one of the most promising growth industries driving the local economy, according to the REIQ.
State government figures released in September show Queensland’s share of the cash international tourists spend in Australia grew more than all other states.
Tourism Industry Development Minister Kate Jones said international visitor expenditure grew 11.5 per cent — more than double the national rate.
“We also saw record highs in international visitor numbers, with 2,762,000 visitors spending $5.9 billion in Queensland,” Ms Jones said.
Lizzy and Gerard Tibbetts are looking at buying a house in Sandgate, which recorded the strongest median house price growth in 2018.
The couple recently sold their home in nearby Brighton and have inspected a three-bedroom character home at 12 Wolsey St, Sandgate, which is on the market for offers over $749,000.
“We’re looking to have kids in the next few years, so we’re after something a bit bigger and those sorts of houses that have a bit of history,” Mrs Tibbetts said.
“That’s why we like it here — it’s by the water and has a lot of original homes.”
The pair, who have been married about 18 months, also love the community feel of Sandgate and its affordability and proximity to the CBD.
“I can get there on the train in half an hour, but not pay the prices you would in suburbs like Paddington,” Mrs Tibbetts said.
“And it’s not cut up into 300 sqm blocks!”
Marketing agent Zac McHardy of Harcourts Pinnacle – Aspley said he was not surprised Sandgate had recorded growth of more than 18 per cent in its median house price in the past year because it had been experiencing a period of gentrification.
“There’s a lot of older homes in the area with older people living there and a lot of them are being sold and people are renovating them and moving in or selling them off, and that’s making a huge difference to the area,” Mr McHardy said.
He recalls moving out of Sandgate when he was 17 because there was “nothing to do”, but that had changed dramatically.
“There’s an actual lifestyle here now,” he said.
“It’s the only place in the Brisbane City Council area on the north side of town that offers waterfront you can actually use properly.
“The whole place is just a community; just a cool place to live now.”
Mr McHardy said mostly owner occupiers were moving into the suburb, but interstate investors were also buying in.
“We’re already seeing the difference (in price),” he said.
“Shorncliffe is just too expensive, so people move to Sandgate, but it’s now starting to become expensive, so they’re moving to Brighton and then they’ll move to Deagon.”
Closer to the CBD, the more affluent suburb of Hendra has also recorded double digit house price growth in the past year.
The median house price has shot up nearly 15 per cent to $1.1 million.
It’s not as positive a story when it comes to the Brisbane LGA unit market, but there are solid signs of improvement.
Brisbane’s median unit price slipped 2.2 per cent in 2018 to $440,000, according to the REIQ.
The annual median unit price fell 2.2 per cent to $440,000 in the 12 months to December, according to the REIQ.
But some suburbs bucked the trend and recorded double-digit growth in unit prices, including Acacia Ridge, Rochedale, Yeronga, Gordon Park and Carseldine.
Agents continue to find the investor-level unit sector challenging, but demand for units aimed at owner-occupiers has improved, according to the REIQ.
The most popular price range for units in the Brisbane LGA is $350,000 to $499,000.
TOP GROWTH SUBURBS FOR UNITS IN BRISBANE LGA
Suburb Median price Annual change %
1. Acacia Ridge $444,017 36.6%
2. Rochedale $747,500 34.1%
3. Yeronga $525,000 21.4%
4. Gordon Park $382,500 17.7%
5. Carseldine $375,000 15.4%
(Source: REIQ, based on 12mths to December 2018)