The best suburbs in Brisbane to sell under the hammer have been revealed, with new data showing the hotspots where vendors are making the most of a thriving auction market.
Brisbane, not traditionally an auction-led city like Sydney and Melbourne, has long had institutionalised low clearance rates but the appetite for auctions has grown in recent years, particularly in suburbs where buyer demand is high.
New data from Domain has drilled down to the number of auctions held in each suburb in the 12-month period to August this year, as well as the number of properties sold by auction and its correlating clearance rate.
Kenmore, in Brisbane’s leafy south west, and Wishart, 14 kilometres south east of the CBD, had the highest auction clearance rates of any suburb in Brisbane – 62 per cent of properties there sold under the hammer over the 12-month period.
Their clearance rate was more than double Brisbane’s average of 30 per cent during the same 12 months.
Kosma Comino of LJ Hooker Sunnybank Hills said Wishart’s low turnover and strong demand from parents wanting their children in the Mansfield school catchment had seen properties selling under the hammer sometimes for up to $200,000 over their reserve.
“I started doing auctions here because the demand was so huge from buyers that properties were selling within a day and I thought we could do better,” he said.
“When you’ve got demand in a suburb like this, you get such great results. Some properties have gone for $200,000 to $300,000 over reserve – for somewhere out in the suburbs to get those results is absolutely crazy.
“I honestly reckon this would be one of the best suburbs to sell via auction.”
It was a similar story in Kenmore, where a shortage of stock, coupled with its affordable prices for young families, made it an area in high demand.
“Kenmore has been the place over the past 12 months that I have recommended to young families as value for money because there’s over a 10 per cent price difference between it and Chapel Hill,” said Reuben Packer-Hill of McGrath Paddington.
“High clearance rates are always going to come down to supply and demand. The big benefit of an auction campaign is you have a deadline, so when there’s a slower market with low confidence, as Brisbane’s has been, you go for auctions because buyers have to make a decision.”
Other suburbs with strong clearance rates included Kallangur (60 per cent), Chapel Hill (57 per cent), Chermside West (55 per cent) and Wavell Heights (54 per cent).
However, it was important to note the strong clearance rates in these suburbs, including Wishart and Kenmore, were based on a relatively low number of auctions in each area, said Domain research analyst Eliza Owen.
“A higher clearance rate doesn’t necessarily mean the most robust auction market. The other side of a robust auction market is that vendors are willing to participate, and the number of auctions is relatively high.”
Brisbane’s most auction-heavy suburb was prestigious Camp Hill in the inner east, which had 104 auctions listed in the 12 months to August this year. Camp Hill also had a healthy clearance rate of 34 per cent.
Other suburbs that held a lot of auctions included Sunnybank Hills, Paddington, Calamvale, Wynnum, New Farm, Bardon and West End.
Some of these suburbs reported lower clearance rates, although Bardon, West End, Hendra and Indooroopilly all managed to clear in excess of 40 per cent of their auction stock – a very strong result for suburbs that also had a high number of auctions, Ms Owen said.
“Bardon is a great example,” she said. “I think it is fair to say that suburbs with a strong performing auction market don’t always have the highest clearance rate, but may also have a decent number of listings.
“Bardon has an above average clearance rate of 45 per cent, compared to Brisbane at 30 per cent; and it had a decent number of auctions results collected  – and, importantly, it has seen a rise in the annual clearance rate.”
Shane Hicks of Place Bulimba auctions most of the properties he sells at Camp Hill and said it was the best way to nut out the serious buyers.
“What I found was that in Camp Hill, which had a reasonable market but lacked a sense of urgency from buyers, we’ve been able to successfully use the auction method to decrease sellers’ days on market and create a sense of urgency among buyers,” he said.
“We are dealing with so many interstate buyers – one in three of our transactions would involve an interstate buyer at the moment – and they are so used to the auction process. They find the private treaty process bizarre and often laugh at it. At an auction they feel they are paying fair market value.
“Because of this, we’re finding the appetite for auctions has increased with our local buyers too.”
Ms Owen said it was important to look at all of the factors that impacted on a suburb’s auction figures.
Over the past 10 years, an average of 9.8 per cent of property listings were campaigned by auction, as opposed to about 30 per cent in Sydney and Melbourne.
“The clearance rate is not the only indicator of a thriving auction market. It’s also important to consider how many auctions are being held, how many get withdrawn from auction, and how many properties sell post-auction,” she said.
“When considering the auction method, you may also think about how many similar properties have sold in the area. This will affect the amount of information available about what a property is worth.”
She said it was not always easy to get a clear picture of Brisbane’s auction market.
“Low clearance rates across south-east Queensland are partly institutional. Queensland agents cannot provide a price guide for auctions, which might prevent potential buyers devising an optimal strategy for the day,” she said.
“The auction might be more about drumming up awareness or urgency around a property than selling on the day.”
Brisbane rents: Landlords in ‘rosier position’ as unit oversupply eases
Brisbane rents are creeping up and the proportion of vacant homes is inching down, as the city’s rental market recovers from years of oversupply, experts say.
Asking rents for units rose 1.3 per cent to a median $380 a week over the past year, the latest figures from the Domain Rental Report for the September quarter show.
House rents also edged up 1.3 per cent to a median $405 over the same time period, according to the report released on Thursday.
The combined vacancy rate fell 0.1 percentage points to 2.2 per cent during the September quarter.
It comes after a wave of new apartments were built in Brisbane’s inner city in recent years, with the extra supply keeping a lid on rents.
Domain research analyst Eliza Owen said the market was now in good health, despite appearing to be near-stagnant.
Median weekly asking rents for units
|REGION||SEP-19||JUN-19||SEP-18||QOQ % ∆||YOY % ∆|
|Brisbane – City wide||$380||$380||$375||0.0%||1.3%|
|Brisbane – East||$405||$405||$400||0.0%||1.3%|
|Brisbane – North||$370||$365||$363||1.4%||2.1%|
|Brisbane – South||$385||$380||$375||1.3%||2.7%|
|Brisbane – West||$400||$415||$390||-3.6%||2.6%|
|Brisbane Inner City||$420||$425||$410||-1.2%||2.4%|
|Moreton Bay – North||$315||$315||$310||0.0%||1.6%|
|Moreton Bay – South||$340||$335||$335||1.5%||1.5%|
For units, the stability was a positive story compared to oversupply-induced market weakness a few years back, Ms Owen said.
“There’s been a lot of fear about over-development but in the building space there’s been tightening of dwelling completions,” she said. “They’ve come down sharply and are returning to long-run average levels.”
Rents were now trending up and vacancy rates down, she said.
“The picture for south-east Queensland in terms of rental returns is pretty good, it’s also one of the most affordable rental markets for houses.”
Ms Owen said interstate migration, mostly from Sydney, was a major factor in keeping the rental market balanced.
“The tightening of the rental market is off the back of strong population growth and a very affordable lifestyle, and this is reflected in the rental vacancy rate which is down to 2.2 per cent from 2.6 in the previous year,” she said.
Investec Lists Fortitude Valley Office Tower
The newly-listed Investec Australia Property Fund will divest its 11-storey Fortitude Valley office building with an expected price north of $90 million as it moves to recycle capital.
Fresh off the heels of its fully underwritten institutional placement and purchase of three industrial properties in the Northern Territory, Western Australia and South Australia for $84 million last month, Investec has motioned to sell its Brisbane, 757 Ann Street, tower.
Investec purchasted the Nettleton Tribe-designed tower for 68.5 million after it was completed in 2014.
Comprising 9,422sq m of office space with a weighted average lease expiry of approximately five years, the A-grade building, anchored by technology company Asea Brown Boveri, is 100 per cent leased.
Cushman & Wakefield’s Mike Walsh and Peter Court are managing the international expression of interest campaign, to kick off mid-October, with expectations it will generate strong interest from domestic and off-shore institutions, funds and syndication groups.
“The entire commercial component of the asset is structured on a net lease basis, providing smooth, predictable cash flow for investors,” Court said.
Sales over the first half of the year surpassed the total volume of sales over 2018—reaching $1.2 billion, according to Colliers research, with Australian institutional investors dominating the lion share of transactions.
Commercial assets currently on the market include Perth-based investor RG Property’s 410 Queen Street in Brisbane’s ‘golden triangle’.
Recent Brisbane assets changing hands include the sale of the Jubilee Place Office development at nearby 470 St Pauls Terrace to a real estate fund managed by Credit Suisse, Malaysian-backed HCK’s 116 Adelaide street for $30 million, and QIC’s Q&A Centre at 141 Queen Street and 140 Elizabeth Street which sold to Taiwanese developer Shayher Group.
As for development plans in the Fortitude Valley precinct, Sydney fund manager Millinium Capital in August announced plans for a new university campus and 30-storey tower that would comprise student accomodation, co-living and co-working space at 240 Brunswick Street and 11 Overells Lane.
Australian property management startup raises $3.5 million, expands to Brisbane
Australian proptech startup :Different has announced it raised $3.5 million in its latest funding round to continue its national expansion.
The fund raising coincides with the company’s launch into Brisbane today.
:Different is a full-service property management startup where property owners pay a fixed fee of $100 per month instead of a percentage based on the rental price of the property.
The appeal of :Different is their tech base which automates the everyday tasks of a property manager.
:Different’s owner app provides 24/7 access to documents like lease agreements, statements, and maintenance requests, while the tenant app helps streamline requests and fast track communications.
Over the last 12 months, :Different’s customer base has grown five folds with more than $700 million worth of properties now under management across New South Wales and Victoria, while its team has quadrupled to 32.
The latest funding round supports :Different’s ambitions to expand into new markets, further enhance its tech platform and continue to build its team of expert property managers, said Mina Radhakrishnan, Co-Founder at :Different.
“We’ve already had huge success since launching in Sydney and Melbourne, and we’re thrilled to offer the same great offering to Queenslanders,” Radhakrishnan said.
“We have big growth ambitions for :Different. This latest funding round will help us continue to rebuild property management in Australia and beyond.”
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