Recapping the 2019 Brisbane and South East property market and what to expect in 2020
In September 2018 60 Minutes reported that 2019 could see property prices fall 40 per cent. That didn’t quite come to fruition. Although the media often makes it out to be, Australia’s property market is not one single entity. Each state, city and region move separately through the stages of the property cycle. When mainstream media reports on the property market rising or falling, this might be totally contrary to what is happening in your area, city or state.
Sluggish growth was recorded in the first half of 2019 but since June, Brisbane property prices have increased 2.2 per cent. Property values on the Gold Coast increased 1.9 per cent in the three months ending in October 2019. In particular, the Northern Gold Coast’s proximity to both Brisbane and the Gold Coast CBD has made it a popular spot for buyers. In Ipswich, steady buyer demand thanks to affordability and close proximity to job hubs has seen Ipswich property prices continue to rise. 2019 saw North Ipswich record an 8 per cent house price increase, Yamanto following in suit with a 7 per cent increase and Eastern Heights recorded a 6 per cent increase.
Queensland’s rental market was particularly strong in 2019. As of October, Brisbane’s vacancy rate was sitting at 1.6 per cent (its lowest rate in 11 years) – 0.7 per cent lower than the previous quarter and 0.5 per cent lower than the same quarter in 2018. Redland and Logan City reported the tightest vacancy rates at 1.5 per cent each, Ipswich City with 2.9 per cent.
Before we move into what we can expect to see in 2020 and beyond, consider this: Instead of trying to predict the market and pick the perfect moment, here’s a key question to ask yourself if you’re thinking of selling or buying.
‘How will my life improve as a result of this sale or purchase?’ Use that, not the market, when choosing a time to sell or buy.
What can we expect to see in 2020 and beyond?
As a result of the RBA’s interest rate cuts, a relaxation of credit restrictions, and strong population growth, the Housing Boom and Bust Report expects most of Australia’s capital cities to record dwelling price rises. Furthermore, the First Home Loan Deposit Scheme will be implemented from January 1 2020. Under the scheme, first home buyers will only need a 5 per cent deposit saved to be able to lend up to 95 per cent of the purchase price of the property without needing to pay Lender’s Mortgage Insurance (LMI). This is likely to create strong motivation in markets.
Some of the country’s leading analysts have made their predictions for Brisbane’s property market for 2020 – 2022.
BIS Oxford Economics (property analysts)
Positive about a recovering and flourishing Brisbane property market
Predicting greatest national gains in house prices – 20 per cent rise by 2022 and 14 per cent for apartments
Moderate price growth in 2020 with 2021 – 2022 expected to deliver significant price jumps
Domain Economist Trent Wiltshire
Predicts moderate growth for 2020: house prices to increase 3 to 5 per cent, units by 0 to 2 per cent
CoreLogic (Moody’s Analytics)
Apartment values to grow by 5.8 per cent in 2020 and climb a further 5.3 per cent in 2021
House values to grow by 5.8 per cent in 2020 and continue with a further 2.3 per cent rise in 2021
QBE
By June 2021, QBE forecasts that house prices in Brisbane will experience a cumulative growth of around 11 per cent to $615,000
Predicts unit prices to decline by 5 per cent over 2020 – 2021
Relative housing affordability, strong interstate migration sustaining population growth, low unemployment/good employment growth and current and upcoming development and infrastructure projects are some of the positive factors underpinning the positive forecast for the Brisbane and wider property market.
Brisbane Metro will see the adoption of a fleet of clean, green battery-powered, near-silent electric vehicles service the 21 kilometres of existing busway between Eight Mile Plains and The Royal Brisbane and Women’s Hospital (RBWH). Each metro vehicle will have the capacity to fit 150 people comfortably and includes USB ports and free Wi-Fi for all passengers. The network will provide better interchange opportunities and deliver more services to the suburbs while supplementing the Cross River Rail project.
Cross River Rail – Brisbane’s new underground project – is a new 10.2 kilometre rail line from Dutton Park to Bowen Hills which includes 5.9 kilometres of twin tunnels under the Brisbane River and CBD. The Queens Wharf development in Brisbane CBD that is expected to open in 2022 will transform the CBD and river edge into an iconic architectural masterpiece that embraces Brisbane’s subtropical climate.
Moving into 2020 and beyond, Brisbane and the South East region is looking very healthy due a multitude of positive factors.
Article extrapolated from:
Boucher, D. (2019). ‘House Prices Set to Rise 7 to 11pc in 2020: SQM’, The Urban Developer, 14 November. Available at: https://theurbandeveloper.com/articles/-property-prices-forecast-to-rise-in-2020
Dabu, B. (2019). ‘Property market update: Brisbane, October 2019’, Smart Property Investment, 7 November. Available at: https://www.smartpropertyinvestment.com.au/research/20274-property-market-update-brisbane-october-2019
Holliday, K. (2019). ‘Brisbane property market forecast 2020’, Open Agent, 27 August. Available at: https://www.openagent.com.au/blog/brisbane-property-market-forecast-2020?utm_expid=.6ZprDALXQh2rpM05ZARdBA.0&utm_referrer=https%3A%2F%2Fwww.google.com%2F#
Vecchio, J. (2019). ‘Three big things happening in Brisbane | Property market in 2019’, Hunter Galloway, 30 October. Available at: https://www.huntergalloway.com.au/brisbane-property-market-2019/
Yardney, M. (2018). ‘Minutes right to say house prices will fall 40% in the next year?, Smart Company, 21 September. Available at: https://www.smartcompany.com.au/industries/property/ticking-time-bomb-60-minutes-right-house-prices-fall-40-per-cent/