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So the effects on the Property Market due to the Coronavirus have been stark, but we are now starting to see results, and they may surprise you.

5 articles during the past week show what is happening in the Brisbane Property Market, and the changes the pandemic has created.


“Brisbane’s Luxury Market Lures Expat Buyers”

Brisbane had the best-performing luxury market on Australia’s east coast in the second quarter of 2020, according to Knight Frank’s latest Prime Residential Review report.

The Queensland capital’s lifestyle, relative value against southern counterparts and swift recovery from lockdown emerged as the key factors underpinning its growth.

The report found that Brisbane’s prime property price growth increased 2.5 per cent over the year to June, and up 0.3 per cent over the past quarter.

Prime or luxury residential property is defined as the most expensive property in a given location, generally seen as the top 5 per cent of each market by value.

No doubt our climate and safe environment have had a lot to do with this.  Recently we have been seeing many reports of record prices being paid for top end property.


“Consumer demand changes to outer suburban areas”

The Domain Buyer Demand Indicator has revealed both houses and apartments in the outer suburbs of Brisbane  were the highest demanded properties for the month up to 6 September.Brisbane property market post covid – results

The research showed consumers are starting to adapt to the new norm, with working from home making living near the office less crucial in capital regions.

“The current health crisis has changed the way we use our homes, and for some altered our purchasing decisions and property wish lists,” said Domain senior research analyst Dr Nicola Powell.

Not only is buying activity in the CBD changing, so is the rental market, with consumers also looking at regional and outer suburb areas.

According to data released by SQM research, while some capital CBD markets are recording double-digit rental vacancy rates, renters hunting in regional areas are facing slim pickings.

This is leading to outer suburbs and regional areas having a spike in growth.


“Covid Creates Two-Speed Rental Market”

The onset of Covid-19 may be creating a two-speed rental market, with inner-city rents declining faster than those in the outer suburbs.

Corelogic data confirms that there is a positive correlation between changes in rent values and distance to the CBD.

This means that the closer a region is to the CBD, the more likely it is that rent values have fallen.

Rent values were analysed across statistical area regions of Brisbane, Sydney and Melbourne—for each region, the median property distance to the CBD was compared with the change in total rental market values from the end of March (which marked national, stage 2 restrictions) to the end of August.

For regions where the typical property is less than 10km from the CBD, the average decline in house rents was 2.3 per cent, and 3.6 per cent across units.

For rental markets 10km or further from the CBD, house rents had actually increased 0.1 per cent, while unit values declined a relatively mild 0.4 per cent.

Why have inner city markets been more affected?

As has been noted in previous research from Corelogic, there are several distinct factors of the Covid-19 downturn that have made inner city rental markets particularly susceptible to a decline in rental values.

These include the relatively high exposure to overseas migration as a source of housing demand.

Where have rents increased?

Of the 125 rental markets analysed, there were 63 regions where house rents increased, and 35 regions where unit rents increased, since the end of March to August.

Rental increases were most common across Sydney and Brisbane, where employment has been less affected by the pandemic, and social distancing measures have eased.

The reason for rental value increases in outer-suburban areas are less clear.

One explanation may be that outer-city suburbs have been less exposed to the factors driving declines in demand, such as overseas migration.

Anecdotal reports assert that a draw card for outer-city suburbs are relatively cheap rents, and low density along with remote working lessening the hurdle of travel times from areas located further form the largest employment nodes.

This may have increased rental prices through higher demand.

The analysed data set also revealed that rental value increases have occurred in cheaper rental markets.

It may also be the case that added stimulus to low income households have added to rental demand in areas where rents are usually cheaper.

The tapering of this fiscal support may lead to a more broad-based decline in rents over the next six months.


“Impending boom: Property prices predicted to surge 15pc by 2023”

Things are looking up for the national property market as experts predict house prices could experience a significant boom in the near future according to Westpac’s optimistic property forecast. The nation’s second biggest bank has predicted prices are set to bottom out by June after a 2.3 per cent fall before creeping back up by 15 per cent in 2023.

The bank initially predicted a 10 per cent slump for national housing prices between April 2020 and June 2021 with a slight 8 per cent recovery in store for next year, however Westpac’s chief economist Bill Evans and senior economist Matthew Hassan have improved their expectations.

The forecast now predicts the total fall to be 5 per cent – which is a further 2.3 per cent fall after already declining 2.7 per cent since April – as several capital cities are proving to be more resilient. Perth’s prices are expected to remain the same while Adelaide will actually rise by 2 per cent. However, locked-down Melbourne is expected to have the biggest drop of 12 per cent, followed by 5 per cent in Sydney and 2 per cent in Brisbane.

Westpac’s figures were the most promising compared to its fellow lenders with Commonwealth upgrading its prediction earlier this month from an expected 10 per cent drop to 6 per cent followed by a meek 3 per cent recovery in the second half of next year.

Economic experts predict prices will reach their lowest in June next year following a surge in urgent or distressed sales after all mortgage deferrals expire in March. Some of this brunt could be felt in the coming weeks as around half of the more than 900,000 deferred loans will be assessed in September and October as they reach the end of the six month stint, according to the Australian Banking Association.

However, the market is expecting to see a 15 per cent surge that will be spread evenly over the two years leading up to mid-2023 with the biggest gains being felt on the east coast with Brisbane expecting a 20 per cent boom. Meanwhile, Perth will see an 18 per cent rise, Sydney with 14 per cent and 10 per cent in Adelaide. Meanwhile, Melbourne will see a 12 per cent increase which will bring the city back to its pre-Covid prices while the other capitals get substantially more expensive.

So there you have it.  People are looking to move out of the CBD and into “safer” suburban locations.  Brisbane is being seen as a safe, clean environment to invest and top end money is flowing to luxury property.  Moving forward some experts are predicting big upward moves in property prices over the next couple of years.

In our office we are experiencing massive buyer demand and simply do not have enough properties available to meet the buyer demand.

If you are considering selling, talk to the team at Hicks Real Estate who can help you through the process to achieving a great result.


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Hicks Real Estate is a Brisbane based, full-service real estate agency supporting buyers and sell as well as renters and property investors. With almost 20 years experience in the local market, we are the real estate experts you can rely upon.