Marie Manning - The early termination of our tenant was dealt with efficiently and effectively. We can't thank the team at Rental Trends enough for their professionalism in dealing with tenants who abandoned our property. Having secured these tenants from a different agency, which we left due to poor management, Ann and Sarah managed their abandonment with such efficiency that the unfortunate experience has had little impact for us as landlords....
Brisbane came out on top among the strongest performing capital cities in Australia in 2018, simply because its growth remained positive.
As prices tumbled in Sydney and Melbourne, Brisbane’s housing market continued its well-worn path of solid, modest growth. By December, Domain data showed the median house price had increased to $670,000.
Units were a different story though, with Domain figures showing units in the Brisbane LGA fell 4.4 per cent during 2018, while in Greater Brisbane they fell by 5 per cent over the quarter and 7.9 per cent over 12 months.
Opinions on the future of Brisbane property this year are varied. Positive factors like increased interstate migration, significant infrastructure spending and a good local economy are often countered by stricter lending conditions and the impending banking royal commission and federal election.
That said, a NAB residential property survey released last week showed Queensland was the only state to record a positive outlook, despite negative sentiment spilling over from the declining markets in Sydney and Melbourne.
With those factors in mind, here’s what we can expect for Brisbane’s property market in 2019.
According to recent modelling from the Domain Group, Brisbane house prices are forecast to rise faster than any other capital city over the next two years.
Domain’s Property Price Forecasts report predicts house prices in Brisbane could increase by 4 per cent in 2019, then grow by a further 5 per cent in 2020.
Domain economist Trent Wiltshire said after a tumultuous 12 months for Australia’s property markets, 2019 looked likely to be a year of greater stability across the nation, with Brisbane set to lead the charge.
“Our forecast for relatively strong house price growth in Brisbane is underpinned by a pick-up in population growth and declining unemployment.”
Suncorp CEO Banking and Wealth David Carter said his outlook for Brisbane in 2019 was also largely positive.
“It’s been pleasing to see Brisbane’s property market remain relatively resilient over the past 18 months and I believe we will continue to experience the same positive conditions as we head into 2019,” he said.
“Population growth in the south-east should continue to support demand for homes and units as interstate migration to Queensland continues. Brisbane property prices provide an attractive option for those moving interstate.”
Alex Jordan of McGrath Paddington said 2019 would prove to be a good test for the Brisbane market.
“There’s a lot of different opinions on whether it’s going to grow or not and I’d lean towards expecting gradual growth,” he said.
“Interstate migration is strong and infrastructure is solid but buyer numbers are lower and lending is still tight. I don’t see Brisbane booming in a market where most other capital cities are in a correction phase.”
He said lending criteria issues would continue to plague some buyers, slowing the market down, particularly in Brisbane suburbs at the lower end of the market.
“Areas with mid to high-end properties are still performing fairly strong because the buyers don’t tend to have the banking issues. The tight lending criteria isn’t affecting them as much as the lower end of the market,” he said.
“Overall though, everyone’s capacity to borrow has been reduced. The average borrower’s capacity to borrow is down by 10 to 15 per cent.”
Mr Jordan said he expected there would be a flood of new listings in January and February, giving buyers more choice, but that the upcoming federal election would slow the market considerably.
“There’s likely to be uncertainty with the election coming up in March or May, particularly because it has a property flavour to it this time with the negative gearing and capital gains conversations,” he said.
“So I’d expect 2019 will start off very slowly in Brisbane but pick up once the election is over.”
Shane Hicks of Place Estate Agents Bulimba agreed.
“I expect things will be quiet before the federal election,” he said. “Once the election is over, I think we’ll see the market make up for lost time and that’s when things will really pick up.”
NAB’s most recent forecast predicted Brisbane house prices would not move at all this year, and group chief economist Alan Oster said they were unlikely to boom in the next couple of years.
“We see the housing market as flat and I see that continuing for the next couple of years. That’s the big picture,” he said.
Trent Wiltshire predicted unit prices would bottom out by early 2019 and then grow by about 3 per cent by the end of the year.
But Ray White South Brisbane principal Dean Yesberg said he did not see Brisbane’s unit market recovering for at least another two years.
“I think it will take two more years for the stock to be absorbed,” he said. “There are literally hundreds of the same units for sale in the city and there’s still more to be built yet.
“I don’t think units will go up this year — I think we’ll see 2019 finish the same as it finished in 2018.”
Mr Yesberg said while the three-bedroom market was doing well thanks to a shortage of stock and strong demand for downsizers, one-bedroom units were the problem.
“The majority of the units built were one and two-bedroom, with the one-bed unit market pointed purely to investors,” he said.
“There’s very few investors in the market right now because of the banks, the majority of our buyers right now are owner-occupiers and most owner occupiers don’t want one-bedroom units. The two-bed market has actually really improved over the past six months but we just cannot move the one-bedders.”
The silver lining was the opportunities for potential unit buyers, he said, who stood to make money from the current market.
“In regards to first-home buyers and younger people looking, it’s a wonderful opportunity. If you want to live within two kilometres of the city, this is your opportunity to buy a really good property for $250,000 to $400,000 for a one-bed unit and $350,000 to $500,000 for a very nice two-bedroom apartment.
“There’s a lot of people who bought off the plan who are really taking a financial hit, some by more than 20 per cent. For buyers, there’s some great opportunities.”