Best Time To Sell A House In Brisbane – After a wild 2021 where the Brisbane property market saw many areas experience 30+% price growth and 7.2% growth in the first quarter of 2022, where do we go next?
What with the Brisbane Olympics in 2032 and over $5 billion in infrastructure planned, are there property developments coming to Brisbane?
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Remember in early 2020 property analysts said Australian house prices could fall by 20%?
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And how, instead of collapsing, did Brisbane’s housing market reignite the third-fastest period of annual price growth on record? This just shows how unpredictable the housing market is.
Commentators have seen significant changes at the end of 2021 and predicted future growth in the Brisbane housing market in 2022.
Other property analysts, such as Simon Pressley (who got it right in 2020 and 2021) go even further, predicting up to 27% gains in 2022:
After 15 consecutive years of underperformance, Brisbane will be the best performing capital in 2022. Somewhere in the suburbs 27 per cent capital growth is on the cards for 2022, and 35 to 45 per cent in the two years ending 2023. Simon Pressley , Propertyology
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So with the recent rise in interest rates, high inflation and some other major capital gains declines, has anything changed? Will we still see strong price growth in Brisbane for the rest of the year, or are we on the brink of a crash?
The RBA has warned of a “fall in house prices”, and estimates that house prices could be 15% lower than expected over the next two years, in real terms, thanks to rising interest rates. .
But Propertyology’s Simon Pressley isn’t down on rising interest rates or inflation. He still believes the median house price in many parts of Australia could double in the next 6 years.
And history seems to support his thesis. 20 years ago, when Australia was last nationalized, variable mortgage rates rose 22 times in 6 years. In the last 6 years, we have had a booming real estate market. Brisbane median house price growth was 127 per cent.
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It’s not as simple as “interest rates go up, house prices go down”. There are dozens of factors that affect the real estate market, and interest rates are one of them.
If the property market has strong fundamentals (and the Queensland property market has very strong fundamentals), we should still see price growth over the next 12-24 months.
So whether you are looking to buy a home to live in, or looking for an investment grade property, the Brisbane housing market should be a safe bet.
I think it’s important to remember that Australia doesn’t have one property market. Every state, city and location has its own phase in the real estate cycle.
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While South East Queensland should still see some growth in 2022 and beyond, things may not be as good as some of its other capitals – we’ve had growth of 23.8 per cent in the last 12 months to June 2022.
Brisbane saw its first drop in growth in June this year, but it was only 0.09%.
The Sydney and Melbourne markets currently have the weakest property market fundamentals and are likely to be hit by any market downturn.
We are starting to see evidence of a slowdown in Sydney, down 1.6 per cent last month. And prices are holding steady in Melbourne, down 1.1 per cent in June 2022.
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Thanks to its strong fundamentals, Brisbane and its surrounding areas are likely to continue to outperform the rest of the property market in the second half of 2022.
So we know that Brisbane has been the top capital for the past 12 months, but what does the future look like?
In this section we will cover some of the factors that may affect the Queensland property market and what this means for capital growth in Brisbane for the rest of the year.
The RBA recently raised the official cash rate for the first time since 2010, first by 25 basis points and then by a further 50 basis points from 0.1% to 0.85%. They did this in an attempt to control inflation, which reached 5.1% in March this year.
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Interest rates will indeed continue to rise for the rest of the year, with AMP’s Shane Oliver forecasting the official cash rate target to reach 1.5% in late 2022 before rising to 2% in mid-2023.
In its April financial stability review, RBA modeling suggested that a 2% rise in the cash rate from current levels could lead to a 15% fall in real house prices over two years. A 15% drop in Australia’s current median house price would take prices closer to May 2021 levels.
But this is the Australian market in general, as mentioned earlier, each capital city or location has its own market dynamics. Time will tell, but it is likely that Brisbane’s property market will continue to see steady growth for the rest of the year, even if other capital cities see prices start to decline.
As mentioned above, median house prices more than doubled in 6 out of 8 capital cities (including Brisbane) in the 6 years from May 2002, when the average mortgage replacement rate increased 22 times, from 6.3 to 9.5%.
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Take this article they are quoting from. Some experts have predicted that the median house price in Greater Brisbane will rise by more than $1.2 million within ten years, which is 40 per cent higher than the 10-year average.
They say “Brisbane houses are in line for a $200,000 Olympic bonus” when the city is awarded the 2032 games.
Colliers Queensland office leasing director Matt Kearney said we were entering a “golden decade” in Queensland and the property sector would be a big beneficiary.
Propertyology’s Simon Pressley calls the Olympics a sugar fix – a quick burst of market energy that ends as quickly as it started and has no lasting effect.
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Looking back at the Olympic Games in Sydney, Melbourne and the Commonwealth Games on the Gold Coast, it seems there is no guarantee that Brisbane will overtake any of the other Australian cities due to the Olympics – there are issues. Many others have entered the game.
However, if you are planning to live or invest in Brisbane anyway, you are likely to see higher growth in your property value if you target areas that will benefit from infrastructure investment and modernization occurring between now and 2032. .
Remember, it is worth noting that compared to previous Olympic Games, the 2032 Olympics will require much less investment to host because we will reuse most of the existing infrastructure while the IOC is focusing on sustainability and financial stability. This may mean that there may be little effect on property values.
Not to mention the traditional 7 years from the announcement to the completion date has been extended to 11 years, which has spread infrastructure investment over a longer period of time, potentially weakening its impact.
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As Propertyology’s Simon Pressley notes, the difference in real estate prices is determined by the ratio of how many properties are listed for sale and the amount buyers want at a given time.
Population growth is one of the main causes of housing demand. And Brisbane is currently in the midst of a population boom. Migration to the Queensland state network in the year to June 2021 (latest data available) stood at 30,939. This is the biggest annual increase since 2004 when Queensland’s net migration to the state was 35,498.
Queensland accounted for more than 90% of interstate migration in the year to June 2021. The majority of interstate migration came from NSW and Victoria, which lost 16,676 and 18,300 respectively.
Queensland has lost 14,366 people to June 2021 in net migration abroad during the COVID-19 period, but even allowing for that, there are sixteen thousand people seeking shelter in Queensland.
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More people are looking to buy or rent, which is one of the reasons why Brisbane’s property market has performed so well over the past 12 months.
Looking ahead to the rest of 2022 and beyond, we can expect Brisbane’s population to continue to grow for the following reasons:
Economic conditions are another important driver of housing demand. In other words, if the economy is growing, it means more jobs are being offered.
With more jobs on offer, more people will be attracted to South East Queensland. And increased availability of jobs causes increased wages.
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If you have more open jobs than there are people filling those jobs, companies will compete with each other, putting upward pressure on workers’ compensation.
So a growing economy has a double-edged effect on housing demand: more people move