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The property hotspots that experts have their eyes on for 2021

Lifestyle locations in our cities and regional areas will see strong buyer demand in 2021, as Australians continue to revaluate their lifestyles after a tumultuous year.

Outer suburbs and regional centres offering a better lifestyle at a more affordable price were front and centre in buyers’ minds this year, as the rise of remote working made the dream of moving further afield a reality.

“We have seen the acceleration of the dream,” said buyers’ agent Rich Harvey, chief executive of Propertybuyer. “[This year] has created the ideal opportunity for people to buy in the city fringe and more heavily populated regional lifestyle areas.”

The property hotspots

Newcastle agents are reporting strong interest from Sydney buyers. Photo: Supplied

Cities and regional centres within an hour or two of the capitals will continue to see strong growth, Mr Harvey said.

“We’ve seen dramatic demand for places in the Central Coast and Newcastle from Sydney buyers,” he added.

Matt Lahood, chief executive of The Agency, said both regions, as well as Bowral and Wollongong, would continue to see strong demand in 2021.

“In Newcastle, our team is doing record numbers and they just can’t get enough stock to sell … 70 per cent plus of that interest is from Sydney.

The property hotspots

Bowral is also seeing strong demand, Matt Lahood said, but he noted it had a more limited range of property prices than other regions close to Sydney. Photo: Supplied

Of the four regions it’s the Central Coast seeing the strongest demand, he said, due to its wide array of price points. He added the new Northconnex tunnel, which shaves about 15 minutes off the trip to the Sydney CBD, would likely increase the area’s appeal.

To the north of the state, areas like Lennox Head and Ballina could see strong interest as people priced out of popular Byron Bay look elsewhere, Mr Harvey said

“They’ll get the ripple effects of the growth,” he said.

Domain senior research analyst Nicola Powell said housing affordability constraints in major cities had seen the shift to regional Australia start to gain momentum in 2015 but COVID had seen it explode.

“Affordability and remote working accelerated that trend, particularly for residents in Sydney and Melbourne, but Brisbane is the city that defies that,” she said, noting net internal migration showed it had gained more people from the rest of the state throughout the pandemic.

Brisbane is also seeing strong interest from buyers in the southern states, Mr Lahood said.

The property hotspots

Ipswich in Queensland was one of the expert picks. Photo: Glenn Hunt

While the Gold Coast saw a strong rebound, he noted agents also expected Logan City — situated between Brisbane and the Gold Coast — to do well, with property prices up about 8 per cent over the year to September. Ipswich, to Brisbane’s south-west, was also poised for growth.

Dr Powell said areas that offered a good lifestyle and affordability would do well, given the strong rise in first-home buyers. Developing areas would also benefit, given the recent spike in loan commitments for the construction of new dwellings.

She added strong regional price growth would likely be limited to areas with good connectivity to the major cities, infrastructure and employment opportunities.

Further north, Airlie Beach and Cannonvale, in the Whitsunday region, could see interest pick up, Mr Harvey said, as they were attractive lifestyle areas for those who could work remotely.

In Western Australia, he expected Geraldton, about 420 kilometres north of Perth, and Busselton, about 200 kilometres to the south, to see decent growth, noting both had airports. His pick in Perth was the coastal suburb of Scarborough.

In Victoria, buyers would continue to flock to the Mornington Peninsula, Mr Lahood said, with the coastal communities of Lorne and Anglesea also seeing growing interest.

“They have great infrastructure and they’re 90 minutes from the CBD, allowing people to commute should they need to get back,” he said.

In Melbourne he expected St Kilda and Elwood to do well, noting people had fallen back in love with the classic beachside suburbs, with agents also reporting strong demand in the affluent bayside suburb of Beaumaris.

Experts also expect areas such as Geelong, Bendigo and Ballarat to continue to draw buyers from Melbourne.

“Large parts of regional Australia will be outright star performers in 2021,” said Simon Pressley, head of research at Propertyology.

Unlike most capital cities, bar Canberra, many regions had stronger economies today than pre-COVID, he said.

The property hotspots

Cook Park in Orange, NSW. Photo: Evolving Images / Destination NSW

Mr Pressley expected Bendigo and Warrnambool in Victoria, Orange, Dubbo, Ballina and Kingscliff in NSW, Burnie in Tasmania, Noosa and Yeppoon in Queensland, and Busselton in Western Australia to be among many strong performers.

Across the capital cities, he expected detached houses in Canberra, Hobart and Perth to do best.

Dr Powell said the top-performing capitals would be Perth, Adelaide and Canberra, the latter two of which were slow and steady performers when it came to price growth. Meanwhile, Perth was poised for a rebound after several years of underperforming.

Mr Havey added 2021 could see buyers start to gravitate back towards apartment markets in both the inner city and fringe locations to take advantage of softer prices. He also expected to see investors come out of the woodwork, once rents started to rise again.

 

Article Source: www.domain.com.au

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Brisbane

Brisbane and QLD property market update – December 2020

market update

If there is a defining theme for the Brisbane market over 2020 it has been it’s resilience in the face of a pandemic which has put a halt to interstate and international tourist arrivals for much of the year.

This has not stopped housing values in the city reaching new record highs, with property analysts agreeing that the city, as well as parts of south east Queensland, are on a trajectory of strong growth into 2021. This is against a backdrop of rising values across the major capitals, as the national home value index rose +1.0 per cent in December; the third consecutive month where dwelling values have grown.

Nationally the residential real estate market has proved remarkably resilient, despite a wobble between March and September when COVID protocols interrupted the market – but overall property prices have held steady.

This is largely due to three factors, including the relative success Australia has had controlling the virus, record low interest rates and the government stimulus that has supported businesses and individuals throughout much of the pandemic.

Now let’s take a look at the Brisbane market and how it has performed over December.

Brisbane dwellings continued their steady, determined progress advancing +1.1 per cent over December, for a median price of $521,686. This brings the Queensland capital up +2.1 per cent for the quarter and +3.6 per cent for the year. This places it in the middle of the pack for the major capitals, a position – characterised by a steady and less volatile growth trajectory.

CoreLogic data reports that houses continue to outperform units across the city, advancing +2.1 per cent over December. Property investor and commentator Michael Yardney identifies Queenslanders’ preference for houses over units as the main reasons for this trend.

CoreLogic data reports that houses continue to outperform units across the city, advancing +2.1 per cent over December

If you are looking for suburb specific highlights CoreLogic’s Best of the Best Report 2020 identified Teneriffe (inner city Brisbane) as the Queensland suburb with the highest median house value of $1,859,323.

Michael Yardney points out that, “…in recent months houses in Brisbane have enjoyed improved demand and the number of transactions in the Brisbane housing market are higher than they were pre-Coronavirus.”

He goes on to clarify that property markets within any city are inherently fragmented, and his data shows that, “…freestanding Brisbane houses within 5-7 km of the CBD or in good school catchment zones have grown in value strongly.”

CoreLogic data appears to confirm this, with dwellings in the upper quartile up +1.25 per cent over December. Yardney cautions against investing in certain segments of the Brisbane market which have underperformed, including high-rise apartments, new and off the plan apartments and new housing estates in blue-collar areas.

Like many other regional markets, high demand for property in specific Queensland hotspots like the Sunshine Coast has driven the market up +6.9 per cent over 2020. Contrast this with Brisbane metro’s growth of +3.6 per cent over the same timeframe for some perspective.

Houses dominate sales in most regional markets, and they are posting solid growth here, up +1.5 per cent over December, while units grew a respectable +1.0 per cent over the month.

Sunshine Beach on the Sunshine Coast recorded the highest growth for houses up +27.6 per cent over the year. For units, Noosa Heads has the highest median values at $898,838, while Currumbin on the Gold Coast posted the highest growth over the year advancing +24.0 per cent.

According to property forecasters Hotspotting other regional postcodes showing promise for the 2021, include Mackay, Rockhampton, Gladstone and Townsville – with a recovery in resources behind some of these locations. Toowoomba is also showing promise as new infrastructure projects stimulate the local economy.

Sunshine Beach on the Sunshine Coast recorded the highest growth for houses up +27.6 per cent over the year

Queensland rental market update

Overall Brisbane house rentals have held steady, with a drop in asking rents mainly impacting the inner-city apartment market. According to the SQM, Brisbane’s gross rental yield for houses is currently around 4.0 per cent and for units is around 5.2 per cent.

CoreLogic data indicates that West Gladstone is the Queensland postcode with the biggest change in rents over the year, up +17.4 per cent; while Mackay/Isaac/Whitsundays has the best rental yield of +14.6 per cent.

CoreLogic data indicates that West Gladstone is the Queensland postcode with the biggest change in rents over the year, up +17.4 per cent

The holiday rental market in many regional locations has been impacted by the COVID flight from cities, with rental vacancy rates in some coastal locations close to zero. CoreLogic data shows that the Gold Coast had a vacancy rate of 1.9 per cent in December ‘19, which dropped to 0.2 per cent in December ‘20. It is a similar story on the Sunshine Coast (1.9 per cent vs 0.1 per cent) and Noosa (1.8 per cent vs 0.2 per cent) over the same timeframe.

The outlook for 2021

Overall the medium/long term outlook is positive for Brisbane, with Westpac forecasting that property values could increase +20 per cent in 2022-23.

Realestate.com.au Chief Economist Nerida Conisbee believes that if low interest rates, government incentives for buyers and the Australian economy continues to reopen, ‘prospects for home sellers in 2021 are positive.’

Michael Yardney believes that property markets will perform strongly in 2021 and 2022 based on the removal of overly restrictive lending rules, the job-friendly Federal budget, and  the prospect of no interest rate rises for at least 3 years.

CoreLogic’s Tim Lawless sounds a word of caution, warning that any fresh COVID outbreaks, ‘…would set back the economic recovery and have a negative, although temporary impact on housing markets.’

Article Source: www.openagent.com.au

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Opinion

Knockdowns and urban sprawl: Four property predictions for 2021

property predictions for 2021

The property market was nothing short of unpredictable and difficult to read through 2020.

Yet we look to be entering a year where all the economists and property research houses are predicting positive growth across all markets. Who would have thought?

There will be anomalies, of course, but here are the trends you can count on in 2021.

Affordability and lifestyle: Regional centres within 90 minutes of Sydney and Melbourne

Housing unaffordability has been driving this social trend and COVID-19 has come along and really amplified it.

With densely populated cities more expensive and harder to navigate, and in some cases, due to lockdowns, not offering the quality of life we all crave, many saw 2020 as a year to reflect and redirect themselves to outer regions where price point and lifestyle is more favourable.

We already see this in Queensland, where only 48% of the population live in the capital city of Brisbane and the rest is dispersed out to major hubs such as the Sunshine Coast and the Gold Coast, Toowoomba, Ipswich and many more.

For context, 76% of Victoria’s population live in Melbourne, while Sydney sits at 65%.

The towns must have adequate transport and ease of access to main arterials.

Getting to the capital cities will still be important for these sea and tree changers, as will the central location within the town.

Walkability and education are important for families as are healthcare services for downsizers. Keep this in mind when assessing the property itself.

These regions are also sought after by investors who are keen to establish a ‘foothold’ in one of the holiday regions, such as Daylesford, the Mornington Peninsula or the Bellarine Peninsula.

With a number of factors — such as less overseas holiday travel, low-interest rates and less commuting — allowing for more cash in the bank and a greater focus on what matters most, families want to secure an ‘escape property’ for themselves, a destination they can flee too should lockdowns or pandemics strike again.

More ‘knockdown and rebuild strategies’ in the middle-ring suburbs

According to McCrindle Research, 78% of people surveyed believe working from home is here to stay with most expecting this to be two or three days a week.

But how many of us actually have the space to do this, especially in dual-income houses?

Renovations can be expensive and unpredictable.

Whereas the growing trend of knocking down an old 150 square metre, 1950s–1970s weatherboard or brick home, on 400–800 square metres of land, and replacing it with new build, can not only solve the working-from-home problem, but also result in a very profitable project.

Our smaller cities take flight

With less interest in moving to the big smoke from our smaller cities, natural-born residents will consider staying put and working in their home cities while the uncertainty is around.

The big question is, how compelling will this be in the long term?

The big cities of Melbourne and Sydney house our largest institutions, banks, insurers, super funds and the head offices of most major corporates outside of mining and resources.

They will eventually draw talent from interstate and overseas, and although moving home to Adelaide or Brisbane might be possible if you’re already employed, landing a job from interstate and never being in the office is quite difficult, even impossible.

In summary, the smaller cities of Perth and Adelaide will be strong next year as residents stay put or head home, but in the long run, Melbourne and Sydney will prevail and deliver superior return on investment as they offer higher paying jobs for more people and this drives the property market.

Is the inner-city out of favour?

Apartments are not one property style on their own, there is low rise, high rise, concierge, and facilities, versus art deco walk-ups, with no lift, with plenty of character and charm.

And many more versions of these lifestyle-driven properties are often bought for convenience and affordability.

Generally speaking, the bigger buildings will suffer, although locations such as East Melbourne and Spring Street in Melbourne’s CBD are always sought after and rarely drop in value.

But is this the best place to invest in 2021?

No! Houses will always outperform in the inner-city regions as they are not building them anymore, if anything they are slowing decreasing in numbers to make way for apartments and townhouses.

It’s a simple supply and demand equation.

Expats will be heading home and if returning from New York, London, Hong Kong and LA will be used to the cosmopolitan lifestyle and see the capital city lifestyles as less congested and more liveable than where they’ve come from.

This influx of established wealth will make up for any city escapers who are selling down or moving to the regions.

The cities will bounce back and continue to be our central place of business, leisure and events.

The beautiful established parks and gardens, along with the best food and experiences in town, will draw people back. Plus, being ‘central’ with quick access to the best schools, arterials and major shopping hubs will mean these 3–10km regions will be highly sought after.

Article Source: www.smartcompany.com.au

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Brisbane

Queensland’s booming real estate market to go on for ‘years to come

Queensland's booming real estate market

Wealth management firm Morgans has tipped house prices to continue to rise throughout 2021 and possibly for “years to come’’.

The forecast follows a strong December in the real estate market with Ray White recording $4 billion in unconditional sales in the month in Australia. Almost $1 billion of that was in Queensland.

Morgans Stockbroking economist Michael Knox said the recovery in house prices was healthy.

“It has years to run as full-time employment recovers over the next few years with the coming business cycle,’’ he said.

The likelihood of interest rates rising was also low with Knox believing that the Reserve Bank would struggle to achieve its inflation target until unemployment was below 5 per cent.

“It will take years to achieve that level of unemployment. It is very unlikely that inflation is going to be a problem during this period. Our view is that full employment in the Australian economy is at 4.5 per cent.

“We think it’ll take not less than four years for growth to get unemployment down to that level.’’

Ray White managing director Dan White said its December total sales of $6 billion were up 60 per cent on the same time in 2019.

“In Australia alone, we recorded almost $4 billion in sales, up 50 per cent, with a record result in Victoria to cap off an incredible recovery given extended lockdowns across that state. New Zealand recorded its sixth consecutive record month, with $1.9 billion in sales which was 87 per cent higher than last year

The Real Estate Institute of Queensland’s vacancy data for the December quarter showed Brisbane’s inner city rental market was recovering and was now “the only healthy rental market in Queensland”.

Rental vacancies were now at 3.3 per cent, down from 5 per cent previously.

Beyond Brisbane’s CBD, rental vacancies around the city’s middle ring remain extremely tight, with a quarterly rate of 1.6 per cent including Hawthorne (1.4 per cent), New Farm (1.9 per cent), Paddington (2.1 per cent) and St Lucia (1.7 per cent).

Further out into Brisbane’s outer ring and vacancies are even tighter, recording a quarterly rate of 1.3 per cent.

 

Article source: inqld.com.au

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