In a big weekend of auctions in Brisbane, a Melbourne buyer returned for the second weekend in a row, to try to snap up a property.
But, he was unsuccessful in his bid to buy 128 Kennedy Terrace, Paddington, in Brisbane’s inner west, which sold to a couple living in the nearby suburb of Taringa for $1,262,000.
Ray White Paddington’s Judi O’Dea said the auction of the three-bedroom home was held online and also had phone bidders, such was the interest in it.
A crowd of more than 80 people watched the sale of the property owned by a couple who run a home pre-sale makeover company called Niche Reform.
“The sale price was [$72,000] above the property’s $1.19 million reserve,” Ms O’Dea said.
The weekend’s market was buoyant but stock was still quite low although vendors with good quality properties were looking to sell, she said.
“I haven’t seen the market quite as active as this,” Ms O’Dea said. “It’s to do with the quality of the stock and the fact interest rates are low and are likely to stay that way.”
The unlucky bidder from Melbourne, who also tried his luck at an auction at 168 Boundary Road, Bardon, last weekend, was still looking for a Queensland home, Ms O’Dea said.
The auction was one of 44 scheduled for the weekend. By late Saturday, Brisbane’s preliminary auction clearance rate was 38 per cent after 32 results were reported. Only four scheduled auctions were withdrawn from sale.
The biggest reported sale of the weekend, and one of the biggest in Yeronga, was that of former Olympic swimmer Susie O’Neill.
The eight-time Olympic medallist sold her family home at 401 Brisbane Corso for $3,055,000 to a family looking to move to the area.
Another of the biggest sales was a five-bedroom home at 27 Atkinson Street, Hamilton. It sold under the hammer for $1.56 million to a family with a newborn baby.
Ray White Ascot’s Oliver Jonker said four registered bidders competed for the sale, with lots of interest from buyers prior to the auction.
“It was really great. We had about 60 people attend, and prior to the auction, we had 33 inspections,” Mr Jonker said.
“A lot of work went into getting this house ready for sale. The sellers put in new electrics, new lighting, painted and landscaped.
“It’s a beautiful Queenslander on the side of the hill and you just don’t get an opportunity like this very often,” he said.
Another beautiful Queenslander in Hawthorne, in Brisbane’s inner east, also sold for above $1 million.
Seven bidders registered for the auction of the three-bedroom home at 60 Leura Avenue with a buyer from the street next door snapping up the home for $1.14 million.
Place Estate Agents Bulimba’s Sarah Hackett said the buyer, who paid $40,000 above the reserve, would be renting out the home.
Ms Hackett said only local buyers were bidding on the property.
“We are getting an unprecedented number of inquiries, particularly from down south [Victoria],” Ms Hackett said.
Seven bidders also registered for the sale of a home at 55 Mearns Street, Fairfield, on Saturday afternoon.
Four buyers were ready to put in an offer if the house passed in, Harcourt Property Centre’s Paul Brinckman said.
Of the bidders, about a third of them were investors looking for their next rental property, Mr Brinckman said.
The two-storey home, however, was snapped up under the hammer by a professional couple, for $840,000.
The husband had grown up in the house next door to the property, he said.
“His mum still lives there,” Mr Brinckman said. “He is happy to be so close to his family home.”
This article is republished from https://www.domain.com.au/ under a Creative Commons license. Read the original article.
Unit oversupply remains an issue in Brisbane CBD: RiskWise’s Doron Peleg
The inner-city Brisbane unit market, already hit hard by unit oversupply, continues to remain a huge danger zone for investors since the advent of COVID-19.
Not only is equity risk the major issue for investors, increased vacancy rates and risk to cash flow are also heavily impacting the market.
According to RiskWise Property Research CEO Doron Peleg, things have not improved in the market since the pandemic hit and, if anything, have become worse.
“RiskWise reported in July 2018 that there were 14,813 units in the pipeline in inner-city Brisbane for the next 24 months, being an addition of 20.1 per cent of the current stock,” Mr Peleg said.
“Two years later and there is still a very high level of supply with 5,431 units in the pipeline, making up an addition of 5.9 per cent of the current stock.”
Pete Wargent, co-founder of Buyers Buyers, a national marketplace now offering affordable buyer’s agent services to all Australians, said that rental demand had been weak for CBD apartments for some time.
“The trend has been exacerbated by the pandemic, and CBD rents have been very soft” Mr Wargent added.
Analysis by RiskWise in 2018 showed unit over-supply in inner-city Brisbane had created weakness in the market leading to an elevated level of risk for investors and, therefore, lower valuations and rising defaults on settlements.
“The issue of oversupply is not a new problem and has been there for a few years and the continuous weakness of the unit market in inner-city Brisbane should raise red flags for developers and lenders,” Mr Peleg said.
“Defaults have been rising and will continue to do so.
“One of the key factors has been developers’ lack of foresight regarding unit oversupply as well as the impact of lending restrictions introduced from 2014. It seems there has been no methodological and structured risk-management approach including identification, assessment, and mitigating action plans to address those risks.
“This takes us back to the feasibility stage which includes the assessment of the projected fair market value and the likelihood of defaults and their potential consequences. Developers and lenders must find the right balance between taking risk and making profit.
“COVID-19 has only served to increase the risk. Currently, there are many high-rise properties being offered to a smaller number of investors. This is because there are less investors in the market due to the pandemic.
“The point is that if developers and lenders had put more proper risk-management practices in place, this could all have been avoided.”
Mr Peleg said it must also be remembered the value of off-the-plan property could decrease between the original contract date and settlement resulting in capital loss, as the equity in the home could be reduced, and this was well known in inner-city Brisbane.
He also stressed that investors buying rental apartments unsuitable for families were taking an enormous gamble, with both equity and cash flow risk expected to materially increase. Serviceability is also a major factor for investors who rely on a stable rental income to cover the costs associated with property and particularly the mortgage.
Mr Wargent of Buyers Buyers said houses for investors often carried significantly lower risk for those with the right budget because renters, especially in the more established suburbs, included families and, in many cases, those with permanent full-time jobs. They were also more likely to deliver good medium and long-term capital growth.
Additionally, as rental properties are not fully substitute products with owner-occupied dwellings, there is inherent risk associated with them as they do not appeal to families looking for three bedrooms, with outdoor space, close to schools, transport, and employment hubs.
This article is republished from https://www.propertyobserver.com.au/ under a Creative Commons license. Read the original article
Queensland commercial tenants impacted by the pandemic are set to get further relief, with the state government extending the ban on evictions until the end of the year.
The move means that to the end of 2020 commercial leaseholders can’t have their lease terminated if they fall into arrears as a result of the Covid-19 pandemic.
First introduced in March by the national cabinet, the six-month ban on evictions are due to expire at the end of this month.
Leaving out residential tenancies, the Queensland government’s latest announcement pushes the moratorium on evictions in the commercial space to the new date of 31 December 2020.
Queensland’s announcement comes as other states have extended eviction protection.
Last month, Victoria extended its own ban on evictions for both residential and commercial tenants until 31 December.
While Western Australia and South Australia have each put a six-month extension in place for residential and commercial tenancies until the end of March.
Attorney-General Yvette D’Ath said that landlords and tenants had been working together “in good faith” to “tackle the economic challenges”, describing the announcement as “a shot in the arm” for many small businesses still struggling because of the pandemic.
“This extension is about giving businesses, and the thousands of workers they employ, the certainty they need in these challenging times,” D’Ath said.
With no mention made about Queensland residential tenants, the end of the moratorium looks set to remain as 29 September.
The Queensland government’s decision has been criticised by three of the five members of its Covid-19 Housing Security Subcommittee; Queensland Council of Social Service (QCOSS), Q Shelter and Tenants Queensland.
“Since the Covid-19 crisis began, demand for the state’s tenant advisory services has increased drastically,” Tenants Queensland chief executive Penny Carr said.
“Particularly from tenants fearing eviction after losing their jobs or having their income reduced as a result of Covid-19.”
The code extension means that affected businesses can come forward to receive assistance under the code until 31 December.
Buyer demand has significantly jumped compared to last year across all capital cities aside from Melbourne.
The Domain buyer demand indicator shows that the market has rebounded in recent months—revealing the top suburbs piquing buyer interest.
Houses and apartments in the outer-suburban areas of Sydney, Melbourne, Brisbane and Perth, were the highest in demand for the month up to 6 September.
This follows a state of hiatus caused by caused by Covid which is ongoing in Victoria where restrictions have stopped inspections and dropped listings.
Domain senior research analyst Nicola Powell said they tracked people who were most likely to buy, indicated by shortlisting, sending inquiries, inspecting and frequently viewing photos.
“The current health crisis has changed the way we use our homes, and for some altered our purchasing decisions and property wish lists,” Powell said.
“And while Covid-19 lockdowns sent buyer demand into a state of hiatus, activity from people likely to buy has rebounded in all capital cities apart from Melbourne.”
Top greater Sydney suburbs
Hawkesbury demand increase since Covid
Rouse Hill-McGraths Hill
Rouse Hill-McGraths Hill
Top greater Melbourne suburbs
Macedon Ranges (Houses)
Mornington Peninsula (Units)
Yarra Ranges (Houses)
Top south-east Queensland suburbs
Noosa hinterland (Houses)
Gold Coast hinterland (Houses)
Meanwhile major gains have been made in national vacancy rates to pre-Covid levels with outer suburbs also showing the most improvements.
Residential property prices dropped by 1.8 per cent in the latest quarter according to the Australian Bureau of Statistics.
In Perth, Mundaring houses and Wanneroo units topped the list, Canberra’s Weston Creek was listed for houses and Gungahlin for units. Litchfield, Darwin topped the list in the Northern Territory for both houses and units.
Hobart was the only other city to record a fall in activity over the four week period to 6 September, along with Melbourne, where the most demand was seen for Sorrell-Dodges Ferry and Hobart.
#Greater Sydney#Domain#Covid-19#Top suburbs#Buyer demand#Greater Melbourne#South East Queensland