By Melinda Jennison, Buyers Agent, Streamline Property Buyers | 14-12-2022 | Residential
Interstate migrants pouring into Queensland are propping up property prices that might otherwise be tumbling rapidly in the face of rising interest rates and cost of living pressures.
Encouraged by Brisbane’s relative real estate affordability compared to Sydney and Melbourne, and strong jobs growth, people from New South Wales and Victoria continue to pour across the border to resettle.
Data from the Australian Bureau of Statistics relating to internal migration showed that 47.8 per cent of interstate migration to Queensland was from New South Wales and a further 27.9 per cent was from Victoria.
Around 92,000 people are calling Queensland their new home each year, a population growth rate of 1.8 per cent.
Many are drawn by the strong employment prospects and lifestyle advantages if they are able to work from home.
The annual jobs growth figure for Queensland was 4 per cent in September 2022, which is well above the 20-year average of 2.4 per cent.
Brisbane houses appreciated by 33.1 per cent since the start of Covid and Brisbane units have grown 28.9 per cent in that time.
The market has since segmented in Brisbane, particularly over the last few months, with unit values remaining relatively resilient compared to house values.
The relative affordability of housing across Brisbane compared to Sydney and Melbourne has been described as one potential attraction.
The CoreLogic data (November 2022) shows the median house price in Sydney is $1,243,126 and in Melbourne $915,005. The median house price in Brisbane is just $798,552.
Brisbane units outperforming houses
For units, it represented an improvement on the previous month when values declined 0.9%. Over the last 12 months Brisbane units have grown 8.9 per cent, significantly better than the 2.2 per cent capital growth for houses over a year.
Brisbane rents rising the fastest
Brisbane has had the highest annual change in house rents (up 13.4 per cent) in the country, and the second highest change in annual unit rents (up 14.3 per cent).
Rentals are hard to come by, with the vacancy rate in Brisbane, according to SQM Research, currently at 0.8 per cent.
It is important to note that not all submarkets are becoming unaffordable, as this is dependent on the incomes of the demographic group in a particular location.
With little being done to expand rental supply in the short term, rents in Brisbane will continue to rise, especially if migration levels remain high.
Brisbane’s prospects for 2023
The uncertainty in relation to buying in a higher interest rate environment appears to be easing for Brisbane buyers.
There is an expectation that buyers who have been taking a wait and see approach will re-enter the market once interest rates stabilise early in 2023.
In such a tight supply market, especially for quality properties, unless there is a reason to sell, a lot of sellers are also taking a wait and see approach.
There is no evidence of the large scale forced selling that would be necessary to see a large spike in supply, which could cause further price falls in some areas.
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