Brisbane hasn’t matched the big improvements in Sydney and Melbourne house prices over the past 12 months, yet many Queenslanders are seeing signs of a rejuvenated property market.
We spoke to Meighan Hetherington, Director of Property Pursuit, and asked her if the Brisbane market was improving and, if so, what sort of properties investors were targeting.
She said that while metro-wide numbers showed only moderate growth, the right properties in the right suburbs were in hot demand.
“In the last six weeks, we’ve seen a number of properties getting offers over the asking price on the day of listing, which suggests some people are buying sight unseen,” Hetherington said.
“We are also seeing price improvements in inner-middle suburbs like Stratford of 7% in a quarter.
“That’s just short term, obviously, but it shows some parts of the Brisbane market are moving fast and buyers are indulging in high-risk behaviour because they are scared of missing out.”
What buyer types are you seeing in the market?
“The numbers of buyers coming through our office in 2014 are 42% local, 32% interstate and 17% expat Australians,” Hetherington said.
“While we normally see an even split between home buyers and investors, right now it is 70% investors.
What are they buying?
“Right on the $500,000 mark is where there is a lot of interest. That is the cut off for stamp duty exemption for first-time buyers and it is also the budget many SMSF investors are working to.”
What types of houses are good for investment?
“Houses with genuine character, such as Queenslanders, with style and a well thought-out floorplan are outperforming in low density areas,” Hetherington said.
What about townhouses?
“Three bedroom, one-bathroom townhouses in areas like Holland Park Westare seeing strong demand from investors and home buyers alike,” according to Hetherington.
“Expect to pay $480,000-$510,000 in middle-ring suburbs and around the $600,000-$650,000 mark in a lifestyle area closer to the city.”
“The right units are returning good yields right now but investors need to be discerning,” Hetherington said.
“Tenants are getting fussy and want an apartment with a fresh presentation, particularly in the kitchen and living areas, air-conditioning in the lounge room and a ceiling fan in the bedroom.
“Look for a two-bedroom apartment with the right floorplan in low density complexes and expect to pay around $450,000 to the mid $500s mark. I particularly like Paddington and the church precinct of East Brisbane for apartment buyers.”
What about the top end of the market?
“At the prestigious end of the market there are properties with sound prospects just south of the river that investors could target.
What to avoid?
“Many investors bought into the high density complexes that sprang up a few years ago in places like Clayfield and across Brisbane’s inner-west corridor. That strategy hasn’t worked out [for everyone] and investors should heed the lesson and avoid areas with higher density complexes.”