As a result of the major downturn in the housing markets in Sydney and Melbourne, astute investors are now redirecting their search toward shrewd investments in South-East Queensland.
Realising the growth period was at an end, knowledgeable investors in property have looked interstate and to significant regional locations where prospects are better and entry prices lower. South East Queensland beckoned. After nearly a decade of relative stagnation property prices are on the brink of growth phase. Partly because it never experienced the rapid growth of the southern states its economic indicators now look strong for moderate, sustainable growth. CoreLogic’s Hedonic Home Value Index shows Brisbane to be the only major capital to record housing price growth at the end of last year (2018). A four percent (4%) rise in Brisbane inner-city housing in 2019 is forecast. Because housing is thus more affordable, the South East Queensland property market is not so adversely affected by bank lending restrictions which have been a consequence of the Royal Commission into the banking sector.
Moreover, Queensland’s rental market for investors is buoyant. Rental vacancies are even lower than in 2017 when, in August, they were 3.4%; in 2018 the vacancy level was at 2.8%. The forecast for sustainable growth reflects not only more affordable pricing than in the capitals of the southern states but migration from interstate, ongoing provision of infrastructure and population growth. Over the 25 years from 2016 when South East Queensland’s population was 3.5 million it is expected to grow to 5.3 million, while Queensland’s population is forecast to reach 6.7 million people by year 2036. South East Queensland’s growth will necessitate the building of 30,000 new dwellings every year.
There are important areas where housing remains under-supplied. That this will be exacerbated as the population grows presents both a challenge and an opportunity. Demand is expected to be driven within the Logan and Ipswich Local Government areas. With such strong predicted population growth challenges of supply arise but with those challenges concomitant opportunities arise. Ipswich is expected to attract strong population growth with a predicated 144% rise by 2036. Logan’s population is predicted to increase by 56% by then while there is expected to be a 21% increase in population growth in the Brisbane Central Business District (CBD). To accommodate this supportive infrastructure spending will be around $25 billion.
In all, South East Queensland presents sound investment opportunities for those prepared to research the better locations and seek professional advice. The settings for profitable investment are sound. With due investment diligence the scene is clearly promising.