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Brisbane’s property prices have fallen again, making it one of only two capital cities in Australia to record house price declines over the quarter as well as the year, new data shows.
Property prices dipped across almost all of Greater Brisbane, according to the latest Domain House Price Report, which showed the median house price had fallen by 1.0 per cent over the September quarter to $562,847, and fallen by 1.8 per cent over the year.
Brisbane LGA, where the median house price is $666,500, had also fallen over the past year by 1.3 per cent.
It’s Groundhog Day for Brisbane property prices as the market continues its lacklustre performance, made even more disappointing against the backdrop of Sydney and Melbourne recording astonishing quarterly gains.
But Domain research analyst Nicola Powell said the fall in Brisbane’s house prices was marginal relative to the ongoing decline for its units, which recorded their steepest annual drop – 5.6 per cent — in just over 18 years.
“Brisbane is now the fourth most affordable unit market of the Australian capital cities,” she said. “Increased affordability has allowed buyers to purchase at a six-year low.”
Brisbane’s property prices had fallen by more than Sydney and Melbourne’s over this quarter, but that was unsurprising given their markets experienced double-digit price falls in 2017-2018, she said.
“Yes, it is pretty much flat line for Brisbane,” Ms Powell said.
“(But) you have got to remember there are two different property types – houses and units – and units are recovering from their biggest drop in 18 years and, ultimately, the market has not been able to absorb that additional supply that has entered the market.
“What I do note too is, with Sydney and Melbourne showing signs of recovery, we may see investors returning to those markets, so one question I would have in coming months is ‘are we about to see a swing back from investors to Sydney and Melbourne as their markets start to move?’ ”
She also said demand and cyclical patterns were putting downward pressure on Brisbane prices.
“Queensland has the highest amount of interstate migration, but the number of new overseas residents is well below that of NSW and Victoria. Heightened interstate interest has not been enough to counter the amount of new unit construction,” she said.
House prices in Brisbane’s northern suburbs were the most resilient of anywhere in the city this quarter, rising by 1.77 per cent. Prices in the eastern, southern and western suburbs all fell, albeit marginally.
Market observers were unsurprised with the results, with buyer’s agent Zoran Solano stressing the latest data simply highlighted that the Sunshine State capital was in its “adolescence phase”.
“Hang in there,” was the Hot Property Buyers Agency director’s advice to existing property owners considering cashing out.
“There has definitely been an oversupply of the wrong kind of unit stock and that is clear in these figures but, really, I see Brisbane in its adolescence phase right now, as all the fundamentals point to stronger price growth coming soon.”
BIS Oxford Economics head of property research Angie Zigomanis said Brisbane “still has some challenges economically” but was poised for growth, particularly in premium lifestyle suburbs.
He said price growth in this sector would start slowly, as evidenced by the uplift in the leafy inner-north suburbs, that included Wavell Heights, Kedron, Ascot and their surrounds, before building momentum as 2022 neared.
“If you look at Melbourne and Sydney, things are coming back strongly in the ‘nicer suburbs’, like we are seeing in Brisbane’s north, and as Christmas nears we expect more of the same with more positive signs emerging,” he said.
“I would expect first-home buyers returning to the market too, because of the lower interest rates and the first-home buyers’ federal government guarantee. [They] will stimulate more activity into 2020 from that sector and there will also be a bit of horse-trading between locals who will use these low interest rates to upsize. However, our figures do show there has been a bit of a slowdown of southern buyers migrating to the northern property market.”
Despite the soft figures, Ms Powell said Brisbane’s housing market was balanced as buyers headed towards Christmas.
“Any spending on infrastructure is good and when you see spending on big projects, particularly government spending, these are certainly good fundamentals in Brisbane that suggest future growth in jobs, which leads to population growth, which then stimulates housing demand … we are just yet to see it in the data.”
Debora Sutton, principal of Belle Property Ascot and Wilston, said buyers had been active this spring, all vying for quality properties, which she said were tightly held.
“If we had more to sell, they would sell in the lead-up to Christmas,” she said.
“One of the biggest things is it (the north) has always performed well, historically. A ‘bad’ year in Grange, for example, is nine per cent (house price growth), so there are a number of factors at work here including an absolute lack of properties, which is driving prices when people find properties they like.”
But she added this qualification: “Buyers in the $1 million-plus market are discerning and will not buy anything.”
SOURCE ; https://www.domain.com.au/news/brisbane-property-prices-soften-again-units-record-steepest-drop-in-18-years-896816/?utm_source=email&utm_campaign=ResearchHouse_HousePriceReport_October2019&utm_medium=email