Is Brisbane still the place to be for first home buyers and investors frustrated with Sydney and Melbourne’s tight market?
Property buyers and investors from Sydney and Melbourne are continuing to head up to Brisbane – Where the number of ‘affordable’ suburbs greatly outweighs their local options…
It’s not just the weather that has people talking about Brisbane as an attractive option for relocation. Property buyers, particularly first home buyers and investors from both New South Wales and Victoria are seeing it as a viable long-term alternative with its affordable price points, higher rental yields, optimistic outlook and upswing in the labour market.
And while it may be a topic of conversation across Sydney and Melbourne, ‘housing affordability crisis’ is a little used term in Brisbane where million-dollar suburbs remain the minority rather than the majority.
Earlier this year, Macquarie’s Australian Head of Economic Research, James McIntyre predicted that the Sunshine State was on the verge of a migration boost, which could lead to an ‘additional 20,000 to 25,000 new residents a year compared with 10,000 currently’.
He went on to say that ‘a median Sydney house could currently purchase 2.2 homes in Brisbane, while a median Melbourne property could purchase 1.5 Brisbane properties’.
According to SQM Research, the average asking price for a house in Brisbane during the week ending June 6, 2017, was $605,800. For units, it was $381,300.
In a year where Sydney’s median house price hit $1.15 million and it was named (and shamed) as the second most expensive city to buy property in the world bar Hong Kong, it’s certainly not hard to see the appeal for Sydneysiders.
Buying in Melbourne is also challenging with the median house price hitting a record high of $826,000 earlier this year.
In other supportive figures released this month, Domain Group Data listed 92 suburbs in the greater Brisbane area that have a median below the average purchasing power ($392,000) of first-home buyers. This translates to greater choice in terms of location and type of property.
Of the top 20 affordable suburbs in Brisbane, Brendale was the cheapest and closest to the city centre, with a median of $259,750 and distance of 20 kilometres from the CBD. However, it is still possible to find great opportunities close to Brisbane’s trendiest cafe hubs.
Domain Group Chief Economist Dr Andrew Wilson was quoted as saying earlier this year: ‘The Brisbane median is half that of Sydney…Suburbs that offer good opportunities are generally the northern ones such as Aspley, Albany Creek, Chermside and Kedron. The economy is also doing well’.
While there have been concerns over an oversupply of apartments in Brisbane due to a glut of new developments and a lower than average population growth, industry analysts say that there were signs that the market was in the early stages of returning to normal with average rents for units rising and the vacancy rates falling.
Cohen Handler’s Qld property management team has also reported strong ‘on-the-ground’ signs of a recovering rental market with shorter turn-around time for vacant properties (2−4 weeks on average) and properties in popular inner city locations being leased after only one or two open inspections at same or increased rental rates.
These rental trends will continue to gain momentum as the pull back in new housing approvals and increase in population compound offering opportunities for property investors and the rising numbers of ‘rentvestors’, who are choosing to invest in Brisbane while opting to live and continue renting themselves in Sydney and Melbourne.
Essentially, Brisbane is one of the few places in Australia where you can enjoy strong city salaries, lush latte lifestyles – and you can still be a proud property owner.
Cohen Handler Brisbane team of experienced and knowledgeable buyer’s agents can help you find the right property at the right place. If you would like to know more about the property market in South East Queensland, please contact us today.