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Brisbane property values to benefit from G20

Many people think that finding the right place and the right property for you could be difficult. However, the investors understand whats in and what’s not in the Australian property market, which is why they are sure enough about the revenue and money they can earn if they continue to invest in Australia’s real estate market.

Brisbane’s “dwindling property investment appeal worldwide” could be significantly improved if the city puts on a good performance during the G20 summit later this week, according to a local commentator.

Ayda Shabanzadeh, managing director of Grow Consulting Group, said the city had the opportunity to regain some of its international allure after a spate of recent racist attacks had dampened the enthusiasm of international investors.

Ms Shabanzadeh cited recent incidents including the public racial abuse of a train guard, the tragic murder of international students and the graffiti of a local mosque as examples of the city’s recent struggles – but said the G20 was a chance to reset the city’s reputation.

“Brisbane’s standing as a foreign property investment destination has taken a hit because of the racist incidents here which have caused overseas investors to second-guess the stability of the city,” she said.

“With the eyes of the world set to be firmly on Brisbane during the G20, we can show the globe that these incidents were anomalies and that Brisbane’s a safe and culturally tolerant environment.”

Ms Shabanzadeh said the increase in worldwide exposure for Brisbane can help to “allay doubts” foreign property investors may have about Queensland’s capital.

The 2014 G20 summit on 15-16 November is expected to attract up to 4,000 delegates and 3,000 media representatives to Brisbane.

Ms Shabanzadeh said that besides using the event as a promotional tool to lure back international property investors, the “political meeting of minds” would also serve to benefit the local economy.

“We need to showcase Brisbane for what it is – a city with a terrific climate, great education facilities, a relaxed vibe, kind locals and where properties have growth potential,” she said.

“Hosting the G20 will stimulate our economy due to, for example, hotels being booked by visiting delegates and locals visiting regional cities for the weekend to avoid Brisbane’s increased traffic.”

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Run-down Brisbane workers’ cottages sell for almost $1 million at auction

Brisbane workers

Two shabby old workers’ cottages in two of Brisbane’s hottest locations have sold for close to $1 million each at auction, following fierce bidding battles worthy of a glamorous riverfront mansion.

The dated houses in East Brisbane and Mount Gravatt East attracted hordes of hungry buyers, with the first selling for $856,000 under the hammer, and the latter securing a jaw-dropping $945,000 and 40 registered bidders, topping off a thrilling weekend of auctions across Brisbane.

The pint-sized 62 Stafford Street, East Brisbane, secured 15 registered bidders on the day, with a far-north Queensland couple scoring the winning bid.

With its pink-and-green facade and Hills Hoist clothes line out the back, Ray White Brisbane City principal and auctioneer Dean Yesberg said he didn’t expect the home to get such a result, but put it down to a firing market, alongside the cottage’s prestigious location.

“It was the smallest house in the best street (of East Brisbane) and it’s a cute cottage. Also, the house next door is a magnificent heritage-listed old colonial and that added hugely to the appeal. It gives you confidence as a buyer,” Mr Yesberg said.

“The couple who got it had only seen the property on Friday, and they were coming down from Mission Beach. They wanted to buy something in the city and they’re planning to renovate it.”

Proving size is no guarantee of selling power, the two-bedroom cottage at 45 Gatton Street, Mount Gravatt East, enjoyed a rock-star reception from home hunters and developers alike, before selling for an incredible $95,000 above the reserve price to a developer.

Brisbane workers

Selling agent James Austin, of Ray White Mount Gravatt, said the block itself and the sheer development potential sparked soaring buyer interest.

“There’s nothing like it around this area, it has a dual street frontage and the potential to be split into two blocks of land. Most of the buyers there today were developers with that in mind,” Mr Austin said.

 

“The buyer was an experienced developer who has done a lot of projects in Queensland. He hadn’t seen it prior to that auction that we know of, he just turned up on the day and bid aggressively.”

It was the two humble homes that stole the auction limelight on Saturday, but agents from across Brisbane clocked top sales from mini-mansions through to acreage hideaways off the back of soaring local activity.

Place Bulimba agent Joanna Gianniotis sold 14 Grant Street, Camp Hill, under the hammer for $2.2 million, following what she said was a fast-growing upgrader trend.

“We identified the buyer early on in the piece and it was a family who had come through four or five times. They were moving in from outer Brisbane into the city so their older daughters would be closer to universities and they were looking for just over a year,” Ms Gianniotis said.

“And, they were so excited (to finally get their dream home).

“We’re certainly seeing a strong taste with buyers seeking that large family home where they can house adults. Children are staying home for a longer period and, because of covid, people are working from home, so it changes what you need.

“But, the market in general has been just crazy and there’s just not enough out there, and what there is the locals have been snapping them up.

“In fact, this weekend has been big, with sales to locals who are trying to finalise buying a property before next weekend (when the borders open).”

Although locals dominated the buying pool on Saturday, a sprawling mini-mansion at 170 Camelot Place, Bridgeman Downs, attracted bidders from across the country and around the world, passing in at $4 million.

Brisbane workers

Selling agent Sonya Treloar, of Ray White Bridgeman Downs agent said five registered bidders fought it out for the seven-bedroom abode, which she was expecting to sell quickly in post-auction negotiations.

“We also sold 34 Peppermint Drive in Cashmere and it was a fantastic result. We had six registered bidders and it was fierce up to $1.3 million, before being sold for $1.305 million to a gorgeous couple with two little boys and they are making it their family home,” Ms Treloar said.

“It would also have to be one of the highest prices achieved in Cashmere.

“Right now, we have multiple offers on every property and we were so busy last weekend, we signed six contracts. There are lots of buyers and sellers are achieving really good results.”

Across the prestige end Peter Florentzos, of LJ Hooker Sunnybank Hills, sold 7 Hibiscus Court, Stretton, for $1.626 million, with a local buyer securing the winning bid for the seven-bedroom, four-bathroom mansion.

Brisbane workers

7 Hibiscus Court, Stretton.

“The market is very strong and, in my opinion, it will only get stronger next year. Confidence is back massively and interest rates are ridiculous, so it all falls into place,” Mr Florentzos said.

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Sunshine Coast had Queensland’s top house price growth in Spring: CoreLogic’s Q3 Regional Report

strongest regional housing markets

The Sunshine Coast was one of the strongest regional housing markets in Queensland over the last 12 months, the Q3 Regional Report from property data firm CoreLogic has found.

House values were up 8.1 per cent over the year to October.

They were driven by houses in the upper quartile, whose values were up 9.2 per cent compared to the lower quartile’s 7.4 per cent gains.

The number of house sales were up 8.1 per cent over the last 12 months compared to the 12 months prior. That spike was primarily driven by sales in the $200,000 to $400,000 bracket, which up 36.1 per cent.

strongest regional housing markets

Unit sales were slightly up for the region, just 1.4 per cent, driven by the $400,000 to $600,000 market which saw a 36.9 per cent sales spike.

Unit values saw an large increase, up 4.5 per cent.

It was the upper quartile that vastly outperformed the lower quartile for apartments, up 6.1 per cent compared to 2.5 per cent for the lower quartile.

strongest regional housing markets

The time on market for houses in now 47 days, compared to 53 days last year.

Units are also getting snapped up at a similar pace to 12 months ago, now at 50 days down from 61.

CoreLogic’s head of Australian research Eliza Owen said the traditional draw cards for regional dwelling markets such as lower density levels and lower purchase prices, coupled with the normalisation of working from home, have sparked increased interest among researchers.

“The results of this report support increasing levels of demand outside of cities. Regional Australia’s dwelling markets had higher rates of growth relative to capital cities through the pandemic,” Owen said.

“In the year to October, combined regional Australian dwelling markets rose 4.8 per cent, compared with a 3.9 per cent lift in the capital cities.

“Migration numbers from the ABS show net internal migration to the regions rose to a record high in the June quarter. This was because movements to regional Australia increased, while departures from the regions slowed. As a result, demand for dwellings in regional Australia will have risen at a time when the stock available for sale is relatively low.

“‘Commutable’ regional areas within a reasonable travel distance to the major metropolitan centres have seen particularly extraordinary increases in demand. House sales volumes increased by double digits across the mid north coast, Illawarra and the Hunter Valley.

“Of the 50 house and unit markets analysed, only six markets continued to show declines over the year, including markets far from metropolitans such as Riverina houses, Cairns units and units in Central Queensland.

“With record low mortgage rates and confidence returning to the Australian economy, there is likely to be a broader-based upswing across both regional and capital city markets into the first quarter of 2021,” said Ms Owen.

However, while the story seems largely positive for regional Australia’s residential property market, there is a downside.

“For local first home buyers, declining affordability may become a problem. Growth may start to slow in regions that have already seen a sustained upswing, due to such affordability constraints. These include areas such as Illawarra, Newcastle and Lake Macquarie, the Gold Coast and the Sunshine Coast, where annual growth rates in houses have already exceeded 7 per cent in the year to October,” concluded Ms Owen.

 

Article Source: propertyobserver.com.au

 

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Finance

House price falls, recession prompt BoQ to increase bad loan provisions

House price falls, recession prompt BoQ to increase bad loan provisions

House prices could fall by as much as 12.5 per cent this financial year under the most severe case scenario modelled by the Bank of Queensland that has prompted it to increase its provision for bad loans to $175 million as it braces for a longer and deeper recession.

Investors punished the bank on Tuesday causing the share price to slide by more than 7 per cent after revised modelling factored in the impact of mounting unemployment, sliding property prices and negative gross domestic product on BoQ’s loan book.

BoQ has already been the most exposed bank to loan deferrals, according to data released by the Australian Prudential Regulation Authority, with 12 per cent of home owners and 16 per cent of small business customers applying for loan relief.

The provision for loan impairments, up from $28 million in April, was based on new economic assumptions using Reserve Bank of Australia and internal data. The base case scenario predicts GDP will contract by 6 per cent, unemployment will reach 10 per cent, residential property prices will fall by 6 per cent and commercial property by 10 per cent this year.

On the most severe scenario, weighted by the bank as having a 5 per cent probability, GDP will contract by as much as 9 per cent, unemployment will reach 12 per cent, residential property prices will fall by 12.5 per cent and commercial property by 20 per cent this year.

Chief executive George Frazis said the revised provision reflects the impact of the virus but was pleased that a quarter of the bank’s customers who applied for loan relief had started making full or partial repayments.

“As we all know, this has been an unprecedented year and BoQ is committed to supporting our customers throughout this period. We are very pleased to see many of our customers returning to work and reopening their businesses and will continue to work closely with those that require further assistance,” Mr Frazis said.

Evans and Partners banking analyst Matthew Wilson said he was not surprised by the changes to BoQ’s loan impairment provision, saying he had forecast bad debts of $219 million.

Mr Wilson said the bank’s underlying assumptions were “rather bullish” as they relied heavily on the base case assumption, with only 20 per cent probability afforded the downside scenario and 5 per cent to the severe.

BOQ also announced it had conducted an audit of employee remuneration and found $2.4 million in superannuation had not been paid properly. The bank has set aside $11 million for wage issues and said it is still investigating the matter.

The Finance Sector Union national secretary Julia Angrisano said 750 staff would have to wait until March next year to be repaid, adding this was “not acceptable”. “This is wage theft and we are calling on the Bank of Queensland to accelerate the repayment program to pay affected employees immediately,” Ms Angrisano said.

Mr Frazis apologised for the errors and committed to contacting all impacted employees in the coming months. “We will get this right and we will make sure our people, past and present receive every cent they are owed. This is an absolute priority,” he said.

Mr Frazis did not provide an update on whether the bank would pay shareholders a dividend this year, only to say he realised how important the payments are to retail investors.

“We have completed our scenario analysis in relation to dividends and have consulted with APRA in line with the guidance issued on July 29, 2020. The board will make a determination on dividends in relation to FY20 at our full-year results,” Mr Frazis said.

BOQ’s full-year results will be announced on October 14.

Mr Wilson said he did not expect the bank to pay shareholders a dividend. “BOQ has much on its plate, rebuild the IT platform, rebuild the culture and grow.”

Morningstar analyst Nathan Zaia said BOQ’s deferred loan book was on the “upper end of the market” and predicted cuts to JobKeeper would put further pressure on the banks.

“The government is hoping that as they reduce JobKeeper, more of those jobs will come back so they offset each other,” he said. “But I don’t think that’s going to happen. I think we’re going to have a period where there’s more people doing it tough.”

BOQ’s share price closed at $5.89.

This article is republished from https://www.brisbanetimes.com.au/ under a Creative Commons license. Read the original article.
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