REAL estate investors priced out of southern capitals have begun house-hunting where prices are about half that of Sydney and Melbourne.
The Brisbane-Gold Coast corridor of southeast Queensland is on the cusp of a boom, according to buyers agency Oasis Property chief executive Gavin McPherson, with double-digit growth forecast.
Affordability was a massive driver for buyers, as was good rental returns and strong long-term growth prospects, he said.
“In southeast Queensland, house prices are up to 55 per cent cheaper than Sydney. I’m not suggesting it will get anywhere near Sydney, but we’re anticipating a 30 per cent rise.”
Good pickings in southeast Queensland had driven a “really substantial” surge in interest from Sydney buyers, property investment firm Binvested’s Nathan Birch said.
“I pick up between 50-100 properties in a month. In the past, 80 per cent of the stock was in Sydney. Now 80 per cent is in Brisbane and the Gold Coast. People are priced out of Sydney, where the market is becoming unaffordable.”
He said that in southeast Queensland you could still pick up a three-bedroom townhouse in the mid-$300,000s and have positive cashflow.
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“I think there’s very, very unvalued property up there,” Mr Birch said.
“I’ve been getting thousands upon thousands of emails a week about Brisbane and the Gold Coast. The boom has started, and by 2016-17 will be in full swing.
“It reminds me of the Sydney market three to four years ago. Prices have started to move and there is not much stock out there.”
The latest Place Advisory Investor Sentiment Survey 2015 found apartments made up a third of investor interest in Brisbane, with available stock now down to just five months’ supply — less than half normal market conditions.
In comparison, investor interest in detached houses plunged to just 37 per cent, said report author Lachlan Walker — a major shift given detached houses made up 53 per cent of investor preferences last year.
He said demand was highest for stock in the $350,000 to $550,000 range, which in Sydney and Melbourne meant an inner-city studio apartment, while in Brisbane it was a luxury one-bedroom or lower-end two-bedroom unit within 5km of the CBD.
“Whatever comes on the market is quickly sold,” Mr Walker said.
“We are in a market where, yes, there is a lot of stock, but there is also a high demand for stock.”
One in five people sinking their funds into the hot Brisbane market were bullish, expecting 8 per cent growth, while two in five expected between 4 and 6 per cent, the survey found.
Audiologist and university sports coach David da Silva chose Brisbane’s growing apartment market for his next investment, buying into the 38 High Street, Toowong development which is currently under construction. It was expected to open for tenancy mid next year.
“I (bought off the plan) a while ago,” he said.
“Mine has views of river and university for approximately $500,000. The potential to grow is why I bought it. Toowong’s an affluent area, with good access to the CityCat, trains, buses and university. I did really well out of my last one so I’m happy to get one closer to the city now.”
Originally published as What’s behind southeast’s next boom
Nationally the property market is well balanced between buyers and sellers, but in some areas buyers have all the bargaining power
NATIONALLY the property market remained balanced, but there were still suburbs and towns where buyers well and truly had all the power.
The latest CommBank Home Buyers Index revealled the State where buyers had the most power was Tasmania which was an extreme buyers market.
In terms of capital cities buyers also had the upper hand in Darwin. (more…)