State of Markets - QLD August 2014
Many investors are turning to Queensland as their next investment location, but certain markets are facing challenging conditions.
Prices in Brisbane have risen by 6.7 per cent over the past year, a slower result than Sydney and Melbourne but well ahead of other capital cities, according to RP Data. SQM’s Louis Christopher says Brisbane is not picking up as quickly as some investors predicted but he believes momentum is building and the future looks promising.
Other parts of the state are also attracting interest, data from the REIQ suggests. Total house sales across Queensland rose by 8.3 per cent over the March quarter while most local government areas recorded solid price growth.
The REIQ says formerly depressed tourism regions are on the road to recovery. Cairns put in a solid performance the three months to March, recording a 5.6 per cent increase in median price.
The Gold and Sunshine Coasts also posted solid increases of 4.2 per cent and two per cent respectively. Further north, the Fraser Coast and Rockhampton recorded growth close to three per cent.
LJ Hooker, meanwhile, predicts Toowoomba will ride a wave of growth after the federal budget committed funding to major infrastructure projects like the Toowoomba Bypass. This road duplication will improve access to the city, the real estate agency says.
However, the news is not so positive in all regions. According to Terry Ryder from Hotspotting.com.au, many parts of Queensland are threatened by an over-supply of properties.
In the Brisbane CBD, vacancy rates have skyrocketed and more apartments are slated to come on the market. This trend has caused Propertyology buyer’s agent Simon Pressley to warn investors against buying apartments anywhere in the inner-city.
Mr Ryder also highlights multiple regional areas with slowing economies and a large amount of development activity. In Emerald, he reports, demand is falling as the coal industry weakens. While the town may bounce back in future, he believes investors should currently avoid this market.
According to Mr Ryder, Gladstone, Gracemere, Mackay and Moranbah are in the same boat. REIQ data shows Mackay prices fell by 1.2 per cent over the past quarter while Gladstone fell by 0.6 per cent.
Bundaberg also saw a substantial drop over the three months to March, with the median price tumbling by 3.8 per cent, the REIQ says.
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