Brisbane’s property market has been a rollercoaster. That’s set to change
By Sarah Webb
The Brisbane property market’s rollercoaster run of rapid price increases and falls is tipped to come to an end.
After reaching record heights during the pandemic, moving into a short and sharp downturn late last year, and a more recent recovery, Brisbane property prices are expected to stabilise over the next six months.
Brisbane property prices are tipped to stabilise after a rollercoaster few years.Credit: Bradley Kanaris
A shortage of homes for sale at the same time as an increase in buyer demand – particularly from international buyers – have pushed up prices. But industry experts expect the city’s once cool and calm market to return to form, and price growth to slow due to an increase in supply of homes for sale alongside inflationary pressures.
Ray White chief economist Nerida Conisbee said a shortage of properties for sale had been a key driver of Brisbane’s price growth.
“But more homes are hitting the market, and it’s already exceeding the 2022 stock levels,” she said.
“That said, tonnes of people still want to live in south-east Queensland … and there’s still not enough homes being built.”
Brisbane’s median unit price reached a record high of $478,370 in the June quarter, the latest Domain House Price Report showed, and Conisbee believes there is more growth to come.
House prices by comparison lifted 0.9 per cent over the quarter to $823,272, and are 4 per cent below their 2022 market peak.
“I think the unit growth will go for a bit longer and that’s because on one hand you’ve got affordability, and on the other unit rents are still increasing,” Conisbee said, but added that she expected a little rental price relief in the months to come.
PRD chief economist Dr Diaswati Mardiasmo expected the market to stabilise, but warned of a growing disconnect between buyer and seller expectations.
“The Brisbane market prior to COVID-19 always had steady growth. We didn’t have the massive spikes that Sydney and Melbourne had. Where Sydney and Melbourne’s markets were like a rollercoaster, ours has always been a ‘choo-choo’ train just chugging up the mountain,” Mardiasmo said.
“But then COVID hit, and it changed from a choo-choo train into a rocket.
“[However] over the next six months we’ll see that stability again, but in certain areas it’s going to be sticky. Some sellers will think we’re still in the boom while buyers won’t want to overpay. It also means we’ll likely see longer days on market as homes won’t fly off the rack like they did.”
She added that demand from overseas buyers, particularly from China, was also likely to slow.
“So while China is coming out of COVID now and enjoying low interest rates, we know from going through that pattern ourselves that it won’t last.”
Mardiasmo also expects an increase in the number of larger apartments in the development pipeline, to cater to families wanting to live closer to the city.
“There’s no land in that middle ring of Brisbane … so we’re going to see more family-friendly apartments. This could mean we shift more towards unit living over housing,” she said.
McGrath Paddington sales agent Alex Jordan expects prices to stabilise, and potentially soften, as an influx of homes hits the market in the coming months.
“Historically, spring has always seen increased supply and this year I think there’ll be more than ever because there’s nervousness surrounding interest rate rises, and we may have another couple more ahead of us,” Jordan said.
“That supply increase has already started in Sydney … and it will have a negative impact on values there and days on market. But Brisbane has good fundamentals with the Olympics.”
Still, Jordan warned the market could slightly soften by 5 or 10 per cent due to weakening sentiment and tapering confidence, but said the unit and prestige sectors should still perform well.
“When we get to the $4 million-plus bracket those buyers are still sentiment-driven, and I don’t see that market as heavily impacted [by economic factors],” he said.
“And the best buyers in the Brisbane market are still typically interstate or international.”
Though investors were not active in the market yet, he expects them to wade back in within a year.