The dire headlines continue to scare property owners throughout Australia, but again in this month’s Brisbane Property Market Update November 2018, our city is continuing to show positive signs of stability and certainly not demonstrating the sliding dwelling values that are being experienced in both Sydney and Melbourne.
The latest corelogic data headlines that Australia’s housing market has recorded its weakest conditions since the Global Financial Crisis. The data reveals that the slide in dwelling values is led by Sydney, where the drop was double the national average (-1.4% month-on-month change), followed closely by Melbourne (-1.0%).
Let’s not forget the extraordinary period of growth that both Sydney and Melbourne experienced over the years prior to the current softening. Whilst the current slide in values may prove to be the largest since the late 1980’s for these two cities, they have come off all time highs, where not so long ago the focus was on the struggling first home buyers being priced out by cashed up investors.
Of course, the tightening of mortgage credit over the past two years has certainly also had an impact. The latest Reserve Bank of Australia data on housing credit showed that lending to owner-occupiers was holding up at an annual growth rate of 7%, but lending to investors had collapsed to 1.3%. This shows that most of the moderation has come from the investor cohort who tend to shy away from certain property markets when they are retracting.
In Brisbane the outlook continues to be optimistic, despite the negative price movements of the bigger cities on the eastern seaboard.
In fact some forecasters are predicting Brisbane house prices will grow faster than most other markets over the next couple of years with growth predictions of around 9% in that time. This is underpinned by continued population growth into South-East Queensland as well as a reduction in unemployment.
Brisbane’s housing market is relatively affordable compared with Sydney and Melbourne, which continues to attract new investors as well as those looking to relocate. We are certainly seeing a lot of interstate buying in some pockets of Brisbane, where investors are capitalising on the opportunities that currently exist. Whilst some areas appear to have slowed down, we certainly know which areas are on fire based on what is happening week-to-week!
Brisbane has four of the top ten capital city sub-regions across Australia for annual change in dwelling values according to the latest corelogic data. These regions include the western suburbs, eastern suburbs, Moreton Bay South and the Inner City.
We will continue to monitor the outlook as new data becomes available to us and provide another Brisbane Property Market Update in the new year. In the meantime, we have confidence in the opportunities that lie ahead in the local Brisbane market, and certainly within some pockets. Contact us or book in a complimentary consultation, to find out how we can help you navigate through the headlines and understand what is happening in our local Brisbane suburbs.