By: M. Yardney’s Commentary

Brisbane property is finally going to have its turn in the sun with reasonable growth likely for well located, free standing houses and townhouses in small complexes.

While the overall figures for the Brisbane housing market remained flat over the last year the markets are very fragmented.

CoreLogic report that since bottoming out in June 2019, Brisbane’s dwelling values are up 2.2% with little difference separating houses and units where the recovery is recorded at 2.2% and 2.1% respectively since June. is finally going to have its turn in the sun with reasonable growth likely for well located, free standing houses and townhouses in small complexes.

While the overall figures for the Brisbane housing market remained flat over the last year the markets are very fragmented.

CoreLogic report that since bottoming out in June 2019, Brisbane’s dwelling values are up 2.2% with little difference separating houses and units where the recovery is recorded at 2.2% and 2.1% respectively since June.

However, it will be some time yet before the oversupplied apartment market starts to pick up.

Brisbane’s economy is being underpinned by major projects like Queen’s Wharf, HS Wharf, TradeCoast, Cross River Rail, the second airport runway and the Adani Coal Mine, but jobs growth from these won’t really kick off for a few more years.

In the meantime, a healthy level of affordability at a time of increased interstate migration from Sydney and Melbourne and the return of local and interstate investors seeking strong rental yields plus capital growth should help make 2020 a good year for Brisbane property.

The Brisbane apartment market has been the focus of much negative attention due to excessive supply levels, however recently Brisbane unit values have started to edge a bit higher, which may be a signal this sector of the market has bottomed out.

Unit construction peaked in late 2016, so supply concerns are starting to become less pressing.

The value gap between the East Coast capitals is compelling – it is the largest it has ever been between Brisbane and Melbourne and the largest in 15 years with Sydney, according to CoreLogic.

A typical house in Brisbane is $437,000 cheaper than Sydney and $260,000 cheaper than Melbourne.

This level of affordability, coupled with positive economic signs means Brisbane is primed for future growth.

Within Brisbane, southern migrants and local upgraders are favouring premium property in blue chip inner ring areas close to the CBD and or the river.

In November 2019 SQM Research forecasts that Brisbane house prices will increase by around 6% in 2020.

The Brisbane property market is likely to record positive grow in tin 2020 as the underlying market drivers are now strengthening.

The affordability factor, with Brisbane’s median house price now far lower than Sydney and Melbourne, as well as higher rental returns, is likely to drive more interstate investment into the city.

Local affordability and the lifestyle advantages has resulted in strong interstate migration (+17,426 last year) up 50.5% from previous year.

At the same time 12.7 percent of our overseas migrants are settling in Queensland and interest from foreign investors is rising.

Houses in Brisbane’s inner and middle ring suburbs offer the best prospects of long term capital growth.

Houses: 39% of Brisbane suburbs recorded a median house value less than $500,000 in September 2019, down from 50% five years ago.

The proportion of suburbs with a median value of at least $1 million has increased from 3% in 2014 to 7% in September 2019.

Units: 89% of Brisbane suburbs show a median unit value less than $500,000, compared with 91% five years ago. Suburbs with a median unit value of $1 million or higher has risen from 0.3% in 2014 to 1.3% in September 2019