With Melbourne and especially Sydney becoming increasingly less attractive to first-time investors due to skyrocketing property prices, Brisbane is shaping up as a viable alternative for those prepared to look north.
The Queensland capital has the dual appeal of comparatively low median property prices—of the capitals, only Adelaide’s and Hobart’s lower—combined with solid growth potential over the coming years.
Industry analyst BIS Shrapnel predicts Brisbane will be the only capital city market to experience any increase in house values in real terms (accounting for the rate of inflation) over the next three years, forecasting 13% growth in that period and 6% growth for its units.
So which inner Brisbane suburbs—those within about 15kms of the CBD—are the most affordable to buy into? And do they offer much in terms of growth potential for your investment?
We take a look at CoreLogic RP Data’s figures to find out.
Rocklea
The southern suburb of Rocklea, home to the Brisbane Markets, comes in with an enticing median house price of $353,030, according to CoreLogic RP Data.
It should be noted, however, that Rocklea, which is close to the Brisbane River and one of its major tributaries, Oxley Creek, is also one of Brisbane’s most flood-prone suburbs. Its median house price plummeted almost 24% in the 12 months following the city’s 2011 floods, according to data from realestate.com.au.
Nevertheless, it’s seen solid price recovery since, with a growth rate in median house prices of 10.8% in the 12 months to 31 May, based on CoreLogic RP Data.
Rocklea also has the highest gross house rental yield—the annual income earned through a property when rented out divided by its sale price or market value—of all the top 5 most affordable suburbs, at 5%.
Keperra
Keperra in Brisbane’s north-west has a median house price of $439,015.
It’s about 10kms from the CBD but is serviced by its own train station on the Ferny Grove line, and also boasts a 27-hole championship golf course, shopping centre and several parks.
Keperra residential property is a blend of post-war weatherboard and public housing along with newer developments. It’s seen solid house value growth since 2012 and a median growth rate of 8.14% in the year to 31 May, based on CoreLogic RP Data.
Tingalpa
Tingalpa is about 11kms due east of the Brisbane CBD and, like Keperra, has some older-style post-war weatherboard and chamferboard cottages along with newer estates. It’s also within an 8km radius of Moreton Bay.
Kianawah Park is contained within Tingalpa, as is Carmichael Park, a multi-sports field venue. There’s also a state school, supermarket and family-friendly hotel. Of the five suburbs, Tingalpa has the highest percentage of couples with children as part of its overall mix of household structures.
Tingalpa’s median house price is $478,686, although its 12-month median house growth rate to 31 May was the lowest of the five suburbs at 3.37%, again by CoreLogic RP Data figures. Nevertheless, since 2011 house prices have been on a slow but steady incline in this suburb.
Salisbury
One stop further south along the Beenleigh train line from Rocklea is Salisbury, with a median house price of $485,570. It’s home to Russ Hall Park (also known as Salisbury Recreation Reserve), a multi-function sports and recreational space, as well as a section of the Toohey Forest Conservation Park (see Nathan, below).
Salisbury contains a blend of traditional Queenslander homes, older post-war style residences and newer developments, many of which are freestanding and on decent-sized allotments.
Of the five suburbs, Salisbury has the lowest figure for the average number of days properties take to sell from listing based on CoreLogic RP Data figures – 33 days, compared with 71 in Rocklea, the highest.
Nathan
Nathan is just one suburb over from Salisbury heading east, and is home to Toohey Forest Conservation Park, the foundation campus of Griffith University and the Queensland Sports and Athletics Centre.
Its median house price is $487,265, and of the five suburbs it’s furthest away from the Brisbane CBD.
With Toohey Forest taking up much of the suburb, Nathan is relatively sparsely populated. Only 10 properties sold there in the past 12 months looking at CoreLogic RP Data numbers, compared with 129 in Tingalpa, so sales figures are less reliable.
Affordable suburbs for units
CoreLogic RP Data lists Holland Park West, Gordon Park, Kedron, Tingalpa and Moorooka as the most affordable suburbs in inner Brisbane for units. Median unit prices range from around $347,000 to around $351,000.
Capital gains for units in these suburbs over the 12 months to 31 May ranged from 3.2% in Gordon Park to 12.5% in Tingalpa. And CoreLogic RP Data reports Brisbane shares with Darwin the equal-highest gross rental yield for apartments of all the capital cities.
Queensland University of Technology (QUT) property economist, Professor Chris Eves, has raised concerns the city’s inner-city apartment market could falter next year due to oversupply.
He notes the increase in newly built apartments in the Brisbane CBD, South Brisbane and West End in particular, but suggests established (i.e. not off-the-plan) units in middle and outer inner-fringe suburbs with good schools, transport and city access—which would certainly include Tingalpa and Moorooka at least—are at less risk of oversupply.
<small?> Source:mywealth.commbank.com.au