It’s no secret that Brisbane’s apartment market has taken a beating over the past couple of years, and it’s been a painful experience for some owners.
The upside to that is if you’re looking at buying a unit, there has never been a better or cheaper time to get into the market. And not just any market but the inner-city market, with the latest data from the Domain June House Price Report revealing that of the 12 suburbs in Brisbane with median unit prices under $400,000, 10 were in the inner city.
Suburbs like Bowen Hills, Fortitude Valley, Albion and Spring Hill – all within three kilometres of the CBD – have seen prices fall over the past 12 months to medians in the $300,000s.
Other suburbs with some of Brisbane’s cheapest unit prices include East Brisbane, Coorparoo, Clayfield, Nundah, Taringa and Kedron.
Bowen Hills, in Brisbane’s inner northeast, is the cheapest suburb in Brisbane to buy a unit. Prices have fallen by 13.7 per cent over the past 12 months to a median price of $362,500. Over the past five years, prices are down by 18.8 per cent.
Brisbane’s cheapest suburbs to buy units (by median price)
|Suburb||Median price||YoY % growth||5-year % growth|
Source: Domain House Price Report, June quarter 2019
Grace Mullins of Coronis Kelvin Grove said it was the one-bedroom, one-bathroom units that had been most difficult to sell but, in recent weeks, inquiry levels were up.
“The opportunity is there for buyers, there are still sellers out there willing to take a significant loss to get rid of their unit,” she said.
“But what I’m also seeing is that confidence has come back since the federal election. People are buying these units now because they feel the market has bottomed out and if they feel like they’re getting a bargain, if they can see the value in it – they’re willing to buy.”
Ms Mullins said the cheap “cookie-cutter” investor stock had been hit hardest by unit price falls, despite much of it being concentrated around some of Brisbane’s favourite infrastructure like the Newstead Gasworks, James Street and the Fortitude Valley shops and nightlife.
“Look, the pain is still there for owners but I would say it’s not as bad as it was. There’s a bit of stimulation now and the buyers are there,” she said.
Lisa Whayman of Williams Real Estate Indooroopilly is selling a one-bedroom unit at Alpha Street, Taringa, for $265,000, where the median price has fallen by 14.5 per cent over the 12 months to June.
She said while the record low prices were a great opportunity for first-home buyers and young professionals to enter the market, with them often paying less for a mortgage than they’d pay for rent, they would need to be in it for the long haul.
“There is an upside to buying a unit now but the key is to go in it for the long term and hold on to the property,” she said.
“Don’t buy a unit as a short-term measure, don’t buy one intending to sell in five years. Hold on to it, rent it out if you need – there’s no problems renting them out – but be prepared to be in it for the long term.”
She said people buying units needed to ensure they were buying in the right location at the right price.
“Make sure you do your homework. Buy near public transport, near the shops, universities, that’s where people always want to be and these properties will always do the best.”
Greater Brisbane’s median unit price fell by 8.9 per cent over the year to June, according to Domain’s June house price report, to $368,946.
“Brisbane unit prices are sitting at 2013 levels, down from their peak in 2015,” said Domain research analyst Eliza Owen.
“But we are expecting prices to bottom out this year … we’re starting to see the end of the downturn in the unit segment.
“Unit listings are also moderating, which should reduce downward pressure on prices.”
‘The margin will never be this close again’: Brisbane’s waterfront secret where property is still affordable
Think “Brisbane waterfront” and Moreton Bay darlings Wynnum and Manly quickly spring to mind.
But only 30 kilometres northeast, on the other side of the airport and a similar distance to the CBD, another bay-front suburb, Sandgate, appears.
The photogenic village topped Domain’s best performing Brisbane suburb list in 2018 with 18.8 per cent median house price growth.
Despite this overall rise in housing value, data-savvy local agent Jacqui McKeering makes the case that Sandgate’s waterfront properties are still undervalued compared to southside bay designer homes.
Ms McKeering, of Jim McKeering Real Estate, says Sandgate waterfront still remains great value because family groups have to buy further back to get more features.
“When the price-to-rateable-land-value gap narrows, you are getting a bit of a bargain,” she says.
“A simple calculation to illustrate this point shows the market value of Sandgate waterfront properties not that much greater than the rateable land value; on average 32 per cent greater.
“In fact one waterfront property sale, back in 2017, sold for 15 per cent less than the rateable land value, yet one block back and without bay view properties have a greater gap of 42 per cent.
“One particular [non-waterfront] property sold as high as 66 per cent greater than the rateable land value.
“The outtake here is there is plenty of money to be made on Sandgate waterfront properties.
“I do believe the margin between waterfront properties and the neighbouring streets will never be this close again.”
Flinders Parade, which runs along the foreshore of Sandgate and into Brighton, plus Eagle Crescent and Shorncliffe Parade, are the waterfront property strips in focus.
Ms McKeering says a lot of people have been buying these older houses and renovating and that at the moment there is some choice in “real cheapies” from about $900,000 to about $1.35 million.
“I know someone who bought for $1.4 million in 2017 with a $1.8 million renovation budget,” she says.
“When you see that sort of money coming into an area, it tells me people are seeing long-term capital value in this area.”
Fellow Sandgate agent Tamara Wecker of RE/MAX agrees suburb 4017’s waterfront properties are priced and selling considerably under their comparable Brisbane market values.
“When compared to Wynnum and Manly,” Ms Wecker says, “absolutely; I mean you can live in the Taj Mahal in Sandgate for about $1.5 million.”
She is seeing buyer migration from Sydney and “a little bit from Perth” because of affordability, and thinks Sandgate’s strict rules, which prohibit multi-unit developments on its waterfront, is a further drawcard.
“People tend to think of Wynnum and Manly but here you can have a premium home and lifestyle only 30 minutes from the city,” Ms Wecker says.
“To be honest, it has been a bit of a secret because we are off the highway so you have to have a reason to come here, but that is changing in the past 18 months.
“We are getting more inquiries from people, even from Brisbane, who just did not know about us.”
Mark Crew has been selling Sandgate housing since 1990 and thinks people have woken up to how great a suburb it is in the past 18 months.
The Professionals’ agent has reported strong interest from Sydney buyers “looking for a better family lifestyle”.
He estimates 25 to 30 per cent of Sandgate buyers this year have come from the neighbouring suburbs of Shorncliffe, Deagon and Brighton; people who want to upgrade but stay in “the village”.
“It is 31 minutes to the CBD and you can be walking on the waterfront with your kids after work and we’ve got excellent schools too,” Mr Crew says.
Regarding Sandgate’s waterfront property market and its value, he says three factors should be considered.
“There are few waterfront properties for sale, land is scarce and over the past 20 years there has been a lot of change to the houses themselves, a lot of renovation and/or raising older three-bedroom cottages and transforming them into often substantial five-bedroom luxury houses,” he says.
“So these houses on their waterfront blocks are, quite rightly, going to fetch more in sale prices when they do one day return to the market; and that is showing.”
Cheap Units In Brisbane Suburbs
Twelve suburbs in Brisbane have a median unit price of just under $400,000, according to Domain’s June House Price Report.
Ten out of these 12 suburbs are in the inner city, the report said.
Bowen Hills, Fortitude Valley, Albion, and Spring Hills are all within three kilometres of the Brisbane CBD. The median unit prices in these suburbs are below $400,000, the figures showed.
East Brisbane, Coorparoo, Clayfield, Nundah, Taringa, and Kedron also offer some of Brisbane’s cheapest unit values, according to the report.
Bowen Hills is the cheapest suburb to buy a unit, with prices falling 13.7% in the past 12 months, the figures showed.
Here are Brisbane’s cheapest suburbs to buy units by median price, according to Domain:
|Suburb||Median price||YoY % growth||5-year % growth|
In Greater Brisbane, the median unit price fell 8.6% over the year to June, according to the report.
The capital city’s unit prices are “sitting at 2013 levels”—down from their peak in 2015, according to Domain research analyst Eliza Owen.
However, prices are expected to bottom out this year, with the end of the downturn in the unit segment in sight, Owen said.
“Unit listings are also moderating, which should reduce downward pressure on prices,” she said.
Brisbane Prices Could Be Headed For Recovery
Brisbane prices are at their lowest level in the cycle, according to the latest national property clock from Herron Todd White (HTW).
The house values in Brisbane, Bundaberg, Ipswich, Rockhampton, and Toowoomba were at the bottom, according HTW.
Meanwhile, prices in Cairns, Gladstone, Mackay, Townsville, and the Whitsundays are starting to recover, the data showed.
There was momentum for the price growth in Brisbane, given that the capital city had been “bouncing along the bottom for some time now”, HTW Brisbane managing director Gavin Hulcombe told The Courier-Mail.
“I think it will be (a) steady rise, but my suspicion is in a couple of years’ time we might look back and think it (now) probably wasn’t a bad time to buy. Some areas are likely to perform better than others,” he said.
Brisbane units are also at the bottom of the price cycle, along with Bundaberg, Ipswich, Mackay, Rockhampton, Toowoomba, and the Whitsundays, according to HTW.
Apartment prices in Cairns, Emerald, Gladstone, and Townsville are already rising, the figures showed.
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