It’s the annual winter prestige property pilgrimage from the southern states to the Sunshine Coast that leading local agent Vicki Stewart has come to know so well.
“People from Sydney and Melbourne come up the first year and fall in love with the climate and the area,” says Ms Stewart, the director of Stewart Property. “They return the next year and don’t want to go home again, so start looking at places to buy.
“And by the third year, they come, and just never go home.”
She did exactly the same thing too, 34 years ago, on a visit from Sydney, and says that migration from daydreamer to new owner causes a dramatic spike this time every year in the market.
Real Estate Institute of Queensland chief executive Antonia Mercorella agrees. “Many travel for a holiday and fall in love with our world-class beaches, fine dining and luxury retail shopping precincts,” she says.
“The seeds are planted and while our prices are high compared with the rest of Queensland, when compared with Sydney or Melbourne prices they’re an absolute bargain.”
At the same time Noosa, at the top of the Sunshine Coast market, has been performing exceptionally well and in the 12 months to March 2019 has hit 8.7 per cent growth, making it Queensland’s strongest area, as against Brisbane’s one to 3 per cent, and the Gold Coast’s 2 to 3 per cent. Since 2014, Noosa prices have risen 44 per cent.
There have been some stellar sales too in the past 18 months, including the $15.2 million sale of tennis ace Pat Rafter’s mansion on Noosa’s Sunshine Beach, followed by the Sunshine Coast record-breaking $18 million purchase of a seven-bedroom trophy home nearby. “But as a general rule of thumb, what you’d buy in Sydney for $20 million will cost you just $8 million here,” says Ms Stewart.
Domestic tourism – of which this coastal region is “the Australian rock star” according to Visit Sunshine Coast chief executive Simon Latchford – always sparks the property market, while its “Hamptons-style cool” continues to drive it on and up.
“The market does leverage off tourism but, often, as soon as people arrive they realise its strengths,” Mr Latchford says. “There are two airports, lots of new infrastructure, a laid-back lifestyle, an extraordinary climate with no cyclones, crocs or box jellyfish, a community atmosphere in a place that hasn’t been allowed to develop too fast, and Brisbane is only an hour and a half away.
“If you want to savour life as it was back in the ’70s, then this place can offer that environment.”
The prestige market from $5 million to $12 million is particularly strong at the moment, with demand surging and stock so tight that one buyer bought a home at Noosa Heads in the past few weeks for $2.9 million over the phone, sight unseen.
“We now have a lot of buyers making multiple offers and there’s not much stock as people are making generational purchases; they’re planning to keep it long-term and hand it down to family rather than sell it,” says agent Nic Hunter from Tom Offermann Real Estate.
“Noosa has always been the pinnacle of that prestige end of the market, and people just love the relaxed lifestyle and village atmosphere.”
Four homes in the area
For sale by informal tender with a guide of more than $4 million, this five-bedroom home has a spectacular waterfront position, with beautiful mountain views and a peaceful position.
“As with all the best homes on the Sunshine Coast, you have to consider the cost of not buying now,” says agent Adrian Reed of Reed & Co.
With deepwater access and an upgraded pontoon to allow the owner to keep anything up to a 58-footer safely moored at home, this family house was designed by Frank Macchia to have a true north aspect.
The home has an in-ground pool and a steam-room, while a recently-installed solar system generates over 100kWh of power in summer and is fitted has battery storage.
It’s going to auction on July 14 through Loren Wimhurst of Next Property Group, with a guide of $4.5 million to $5.5 million.
Floor-to-ceiling windows in almost every room make sure that the stunning views are maximised and that this house is flooded in natural light.
The media room has its own cosy fireplace, there are electric shutters and blinds and an openable roof to control light and temperatures, and underfloor heating on the ground level and in the bathrooms that service the master bedroom.
The home is for sale with a guide of $3.3 million, with Joe Langley of Universal Property Sales.
Billed as a 6-star resort-style home, this home has great north-east ocean views and is just a short stroll to the beach, cafes and shops from its large 1,200sqm block.
There’s an internal lift to each floor, a grand entry foyer, a sound-proofed cinema, in-ground pool and pool room, with landscaped gardens.
It’s for sale with a guide of $3.3 million, through agent Craig Porter of Next Property Group.
Brisbane’s property market forecast for strong growth in 2021-22
Are you wondering what will happen to the Brisbane property market moving forward?
Well… based on how the market has been performing so far it’s likely that will see high double-digit Brisbane house price growth in 2021, with most segments exhibiting strong price appreciation other than the inner city and high-rise apartment market.
And despite Covid related challenges buyers and sellers are still transacting and Brisbane property values:
- increased 0.6% over the last week
- increased 1.8% over the month of September, and
- 19.4% over the last year
And there is still plenty of growth left, as Brisbane property is still very affordable compared to the other east coast capital cities.
What a turnaround from all the pessimistic forecasts all the banks made in the middle of last year.
Currently, the Sunshine State capital is shining but it’s not too late to be early in this cycle – there is plenty of growth ahead – for the right properties.
Outstanding demand for lifestyle areas as well as extremely strong demand for detached houses in Brisbane, particularly in the inner and middle-ring suburbs has delivered 5.3% overall growth in the last 3 months, with Brisbane’s more expensive properties outperforming.
The resurgence of buyer interest in the Brisbane property market has meant that auction clearance rates have consistently been in the 70% range, which is unusual for Brisbane considering this city is not known for its auction culture like its southern cousins, but this is just another suggestion that there are more buyers than there are sellers and this always leads to higher property prices.
At Metropole’s Brisbane office we are noticing more investors are getting into the Brisbane market recognising that while there are no bargains to be found, in 12 months’ time the properties they purchased today will look like a bargain.
Not that long ago Westpac Bank updated its forecasts and tipped Brisbane prices to surge 20 percent between 2022 and 2023, meaning Brisbane is likely to be one of the best performing property markets over the next few years.
Of course, while some locations in Brisbane have strong growth potential, and the right properties in these locations will make great long-term investments, certain submarkets should be avoided like the plague.
Increased demand for Brisbane houses has been underpinned by increasing consumer sentiment, historically low interest rates, and internal migration considering the relative affordability of houses in Queensland compared to Sydney and Melbourne.
Similarly, popular areas of the Gold Coast and Sunshine Coast have enjoyed strong demand considering the increased flexibility of being able to work from home and commuting to the big smoke less frequently.
At the same time, property investor activity has been strong, particularly for houses, not only coming from locals but from interstate investors who see strong upside in Brisbane property prices as well as favourable rental returns.
But be careful…there is not one Queensland property market, nor one south-east Queensland property market, and different locations are performing differently and are likely to continue to do so.
Houses remain a firm favourite of prospective home hunters, with demand rising post-lockdown and it remains significantly elevated compared to last year.
However, apartment demand has been sliding and, in general, apartments in Queensland are a higher risk investment than houses, particularly due to a high supply of apartments that are unsuitable for families or owner-occupiers.
To help you make an informed investment decision, I’m going to examine what’s going on in the Sunshine State in detail in this article.
But be warned…it’s a little longer than normal, so if you’re looking for a particular element of the Brisbane property market, use these links to skip down the page.
There are multiple markets in the diverse sprawling city of Brisbane; divided by geographic location, price point, and property type.
And just to make things clear…I’m talking about the property market in Brisbane – not the Queensland property market.
That’s a very different animal!
If you’ve been following my property investment strategy, you’ll know I only invest in capital cities and that’s why I avoid the Sunshine Coast, the Gold Coast, and Queensland’s regional markets which have very different (and fewer) growth drivers than Brisbane and are therefore more volatile.
And not all Brisbane properties will perform well.
In Queensland, houses are the preferred style of accommodation over units, and investors who buy rental apartments in high supply areas are taking a high risk with both equity and cash flow risks materially increasing over buying the right house.
So how long will this cycle continue?
If you would have asked me this question a couple of weeks ago I would have suggested that our property market would continue growing at the rate of 6 to 7% per annum throughout 2022 until eventually, affordability slowed the market down.
Remember the current upturn phase of the property cycle only commenced a year ago, in October 2020.
Normally the upturn stage of the property cycle lasts a number of years and is followed by a shorter boom phase which is eventually cut short by the RBA raising interest rates or by APRA introducing macroprudential controls to dampen the exuberance of property investors and home buyers.
However, this time around we have experienced an unprecedented rate of growth seeing our property markets perform even more strongly than anyone ever expected, with the rates of house price growth at levels not seen for a number of decades.
While a lot has been said about the 20% increase in property values many locations have enjoyed so far this year, it must be remembered that the last peak for our property markets was in 2017, and in many locations housing prices remain stagnant over a subsequent couple of years and it was really only earlier this year that new highs were reached.
This means that average price growth was unexceptional over the long term, averaging out at around 4 percent per annum over the last 5 years
But recently there seems to have been a change of sentiment about our housing markets from our financial regulators, the banks, and even our treasurer.
The Council of Financial Regulators, the club of four main financial watchdogs, showed concern about the increased level of home lending in the first half of the year.
In particular, they signaled their concern about the number of mortgages taken out at more than six times the borrower’s income.
The council has asked APRA to put together a list of potential measures, but this is going to be a challenge and their response will need to be measured so as not to create unintended consequences such as a severe property downturn.
Just look back to 2014 when APRA checked house price growth by targeting investors and restricting the size of what they could borrow relative to the value of their housing collateral.
While tougher lending standards will certainly take some heat out of Australia’s property markets by restricting the number of people that can get home loans, or lessen the amount they can borrow, the move could backfire in the short term as investors and homebuyers try to rush and buy to beat the buzzer on the upcoming tightening of lending conditions.
Back to the question of when will this property cycle end – there is little doubt that Macro-Prudential controls will have a negative impact on our property markets and slow the rate of growth of housing values.
After all, that’s what they’re intended to do.
Whether the markets will just experience slower growth or stop dead in their tracks will depend on what measures are introduced.
Targeting debt-to-income ratios will have a limited impact on higher-wealth households, who often have multiple streams of income.
However, it will affect lower-income households and those purchasing property for the first time.
If you think about it, first homebuyers don’t have a “trade-in” of a previous home and therefore need to borrow higher loan-to-value ratios.
On the one hand, the government says it wants to encourage first homebuyers, and on the other hand, it is encouraging the regulators to sideline them.
So in the meantime, it’s just waiting and see what our regulators choose to do.
I hope they have learned from the results of previous interventions, otherwise, if history repeats itself, there will be some unintended consequences.
Watch this space.
However, in the meantime, there is likely to be a mini-boom as home buyers and investors bring forward their property purchases to beat the buzzer of more restrictive lending criteria.
So…is it the right time to get into the Brisbane property market?
Anyone who buys an A-grade home or investment-grade property in Brisbane now will look back in a couple of years’ time and recognise they bought a bargain, as this new property cycle still has some years to run.
There is a perfect storm of positive growth drivers that will have Brisbane house prices performing strongly in 2021 and 2022 and the recent announcement of Brisbane winning the 2032 Olympic games will underpin strong infrastructure growth, economic growth, and population growth over the next decade.
This suggests that South East Queensland will continue to be a preferred destination for many Aussies from interstate due to lifestyle, health, and affordability reasons.
But, as I have explained, there are multiple housing markets within Brisbane, based on price point, geography, and type of property and as always, you can’t just buy any property and count on the general Brisbane property market to do the heavy lifting over the next few years, so careful property selection will be critical.
Article Source: propertyupdate.com.au
Unit Yields Outstrip Houses as Rents Rebound
Unit rent prices have risen for the first time in 18 months, recording a 2.5 per cent growth in line with house rent increases.
Domain’s Rent Report showed that gross house rental yields were now at a record low of 3.56 per cent across the capital cities, while unit rental yields increased 1.1 per cent to 3.95 per cent.
Investors are moving into the unit market as asking rents for houses hit record highs in Sydney, Brisbane, Adelaide and Canberra.
Unit asking rent prices have hit record highs in Brisbane and Canberra, and maintained record levels in Adelaide.
It is the first time on record that Melbourne has had the lowest house rent of all capital cities. It is the only city in Australia to have house rents lower than before the pandemic.
Domain chief economist Dr Nicola Powell said renters in Sydney, Melbourne and Brisbane were starting to shift into cheaper apartment living, which was consistent with rent price rises.
“[This is] largely being driven by affordability, whether that’s people seeking a better deal or cities that have record high house rents become a strain on budgets,” Powell said.
“However, space is an important factor for tenants who may have a family or need to share a house.
“In some cities, it’s clear that tenants are willing to pay a premium for space necessary for their lifestyle, as house rents achieve highs and rise at a faster pace for rentals with more bedrooms.”
Houses vs units: quarterly rent changes
Interstate and regional migration has impacted Melbourne’s asking rents for houses, which are the lowest of all capital cities, according to Powell.
“Melburnians have grappled with the longest lockdown of any city in the world, and this has contributed to the market’s weak rental growth,” Powell said.
“It is a good sign for tenants who are wanting more space and now is the time to negotiate on asking rents to secure a good deal.
“However, we have seen that vacancy rates have continued to decline, suggesting that the empty pool of rentals will continue to shrink and rents will not stay this low for much longer.”
Houses vs units: quarterly rent price changes
|City||House rent||Quarterly change||Unit rent||Quarterly change|
^Source: Domain Quarterly Rent Report
Capital cities that have escaped harsh lockdowns such as Perth and Hobart have maintained rent asking prices over the quarter.
This is a positive sign for tenants indicating that after a year of rapid growth, asking rents will start to slow.
Australian Bureau of Statistics data showed investors had taken up a further 5 per cent of the share of home loan values as first home buyer demand contracted.
“There’s tailwind behind rising investment activity boosting rental supply, tighter lending could stall this, particularly if we see further moves from the regulators,” Powell said.
“Some Aussies who made a tree change will start returning to the city as well as people immigrating from other countries will cause vacancy rates to decrease in inner cities driving up rent prices.”
Article Source: www.theurbandeveloper.com
Brand new four-bedroom Townsville townhomes from $372,900
Located in a growing Townsville suburb, Burdell is increasingly in demand due to its reputation as a safe, friendly and conveniently located area.
Heran Building Group has introduced their luxury four-bedroom townhomes in Burdell, North Shore Residences.
“North Shore is a place where a better lifestyle comes naturally, where neighbours know each other by name and the daily essentials are already just moments from your doorstep”, the developers said.
Located in a growing Townsville suburb, Burdell is increasingly in demand due to its reputation as a safe, friendly and conveniently located area.
Priced from $372,900, each four-bedroom home features two bathrooms, double lock-up garages, and a modern kitchen with stone benchtops and European appliances, including a stainless-steel multifunction oven, cook-top, rangehood and stainless-steel dishwasher.
Each townhome has a fully-fenced private yard.
Within the development is a communal swimming pool and ample visitor parking.
Ducted air-conditioning is built into the homes, as are roller blinds and venetians.
Only 15 minutes to the Townsville CBD, North Shore is cleverly positioned for strong ongoing demand thanks to its proximity to important hubs including employment, education, major shopping, arterial roads, and public transport.
Burdell feeds directly into the growing employment node of Townsville and surrounding suburbs via Woolcock St.
The A1 is also only minutes away, providing easy access to all employment locations in the greater Townsville areas.
According to the developers, the expected rental return is approximately $290 to $380 per week, boasting rental yields of 4.37 per cent to 5.52 per cent per annum
The home is located in an evolving location, with two new shopping centres nearby, including North Shore Shopping Centre and the Stockland Townsville Shopping Centre, and the Townsville Grammar School.
Surrounding suburbs also offer a diverse range of amenities from medical, health, retail services and casual dining and takeaway options
Construction on the project began in May, due to reach completion in late 2021.
Article Source: www.urban.com.au
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