Brisbane property market update January 2024
Melinda Jennison | Buyers Agent Brisbane | Brisbane Property Market Update January 2024
Brisbane home prices have hit another new record high during the first month of 2024, with both unit values and house values demonstrating further strong gains over the first few weeks of the year. The rate of growth in Brisbane continues to outperform the national average on both a monthly, quarterly, and annual basis, thus confirming the ongoing strength in the local market.
Brisbane sits amongst three capital city markets, including Perth and Adelaide, which continue to rise at a pace of more than 1% per month. Whereas other capital city markets such as Melbourne, Hobart, and Canberra reported subtle declines over the month.
There are other unique differences in how Brisbane’s market is performing relative to the national market. CoreLogic has reported that since the commencement of the upswing, capital city house values have surged 11% higher, while unit values are up 6.9%. In Brisbane, house values have increased 15% and unit values have grown 13.6%. The performance in both segments of the Brisbane market has been superior to the capital city growth at a national level, but the undeniable difference is the surge in unit values in Brisbane, relative to the national average.
Brisbane outperformed the national capital city average growth rate by 36% in the housing market but smashed the average value of unit price growth at a national level by 97% over the last 12 months. This is a significant difference in performance compared to other locations around Australia.
It comes as a surprise to many, how property markets like Brisbane can continue to perform so well, despite ongoing cost of living pressures, a higher interest rate environment, decreasing affordability and very low consumer sentiment. The fact is that homes are still selling, and they are still selling very fast. CoreLogic data confirms that the median time it takes to sell a home is trending down with the median days on market decreasing from 27 days in December 2022 to 21 days in December 2023. Many of the highly desirable quality properties are selling after the very first weekend of open homes, confirming the need for buyers to be ready to act quickly or risk missing out.
It’s normal in January to see the property market pick up throughout the month, with most of the monthly activity falling over the last weekend of the month. With fewer actions taking place until the end of January the auction data is also based on lower volumes. Apollo Auctions data revealed an average auction clearance rate of 71.4% in Brisbane with an average of 2.9 registered bidders and a very high bid ratio of 70.5%. this means, nearly 3 out of every 4 bidders who registered, actually raised their paddle, which is a big leap from last month when on average there were 65.4% of registered bidders participating in the bidding activity.
Perhaps part of this is the fear of missing out, as prices continue to rise and finding properties to buy remains difficult. Whilst new listings in Brisbane were 4.8% lower in January, compared to December total listings were actually down 7.2% month-on-month. Compared to 12 months ago, total listings in Brisbane throughout January were down 17.3% according to SQM Research. It’s a competitive environment when there are a high volume of buyers competing for fewer and fewer properties.
It’s no wonder property prices keep rising. Here’s a summary of the latest data.
Brisbane Dwelling Values
Dwelling values in Brisbane increased a further 1% throughout January. The quarterly change is 3.2% which is down slightly from last month where the quarterly change was 3.7%. So, the rate of growth is slowing but is still strong month-to-month.
The median value of a dwelling in Greater Brisbane is currently $796,818 which is $9,601 more than last month and $26,243 more than 3 months ago.
Source: CoreLogic for Brisbane Property Market Update January 2024
The median value of a dwelling in Brisbane is higher than Melbourne’s median dwelling value, which was reported in the media last month. However, the composition of units and houses is very different between the two cities which is why both median house and median unit values in Brisbane remain lower than in Melbourne, despite this shift in the median dwelling value. This is an example of how housing composition can change the data, which can then be misrepresented.
The segmentation of dwelling value growth in Brisbane shows that properties that make up the lowest 25% of dwelling values have outperformed the middle 50% and also the top 25% of properties that contribute to all dwelling values, over the last three months. With 4.2% growth in the lowest priced properties over the last three months, compared to 3.5% in the highest priced properties, this confirms that cheaper properties have grown at a faster rate over the last three months. Remember, units will mostly be captured in the lower priced properties, so there will be some bias in the data because of this and we can’t automatically assume that the lower priced houses are growing faster than higher priced houses. Unfortunately, this data is not available for each property type.
Source: CoreLogic for Brisbane Property Market Update January 2024
Proptrack data also confirms that Brisbane experienced positive growth throughout January 2024, again confirming performance exceeded the national and capital city average.
Source: Proptrack
House Prices in Brisbane
The median house price in Brisbane increased a further 1% in January, which confirms a new record high. Over the last 3 months, house prices have grown 3.2%, which confirms that the rate of growth across Brisbane is slowing because last month this was 3.8%.
The median house price in Brisbane is currently $888,628 which is $12,637 more than last month and $28,163 more than three months ago.
Source: CoreLogic
Proptrack data also confirmed house prices in Brisbane showed positive growth throughout January, again outperforming both the national and capital city average.
Source: Proptrack
Unit prices in Brisbane
The unit market had another strong month of growth with CoreLogic data reporting a 1.1% increase in median values. Quarterly growth for units in Brisbane is holding fairly consistently with a 3.2% increase over the last 3 months. This was trending at 3.3% last month and 3.1% the month prior.
The median value of a unit in Greater Brisbane is now $568,595 which is $7,579 more than last month and $16,263 more than three months ago. This segment of the market continues to perform consistently month-to-month.
Source: CoreLogic
Proptrack data also confirms the same trend for unit growth in Brisbane and also shows that Brisbane’s unit growth performance is better than the national and capital city average on both a monthly and annual basis.
Source: CoreLogic
The Rental Market In Brisbane
There has been very little change in rental market conditions in Brisbane over recent months. Vacancy rates remain tight, sitting at 1.2% according to SQM Research. House rents have increased 6.8% across Brisbane over the last 12 months and unit rents are up 12.6% throughout the same period. Gross yields are currently 3.7% for Brisbane houses and 5.1% for Brisbane units.
Source: CoreLogic
Summary | Brisbane Property Market Update January 2024
Brisbane’s property market remains strong and resilient. Its growth has outperformed the national and capital city average over the last month, but also over the last quarter and also the last twelve months.
With consistently low listings, evidenced by a reluctance from sellers to sell, and a strong level of buyer demand, prices can only continue to climb in the coming months. Any significant shift in listing volumes or a drop off in buyer numbers may change this trajectory, but at this stage, this seems unlikely.
With inflation falling sharply at the end of January, the outlook for interest rates seems more promising. Not only does lower inflation potentially bring the cash rate down, but it can also help to prove consumer confidence as some of the cost of living pressures subside.
If we see any improvement in people’s borrowing capacity, caused by potential changes in credit policy or a reduction in interest rates, this often creates an environment of improved confidence.
Regardless of what might happen in the future, the fundamentals right now in Brisbane are all showing signs of continued price escalation. It’s not expected that we will see 2024 prices throughout Brisbane surge as aggressively as they did in 2023. But price growth in both the housing market and the unit market is expected to continue at a more moderate pace in the months ahead.
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