17 Sep State of Play – The Australian Property Market
This week I’d like to touch on the current state of play in the Australian Property Market and let you have a sneak peek of a really special project we have coming up on the Sunshine Coast. Keeping up with market trends, and more importantly knowing how it should inform your decisions during a pandemic, can be daunting so I’ve put together a rundown of the latest facts and figures to help.
Where are our capital cities at?
Whilst some capital cities throughout Australia are showing signs of resilience, others like Melbourne and Sydney are softening. The latest CoreLogic data shows that Melbourne is suffering the worst with declines of 4.6%. Sydney property prices are also weaker, reporting a decline of 2.1% and even though WA would like to separate itself from Australia, it should be noted that the Perth market is down 2.0%.
Current numbers coming out of Queensland pose less of a concern – the Brisbane market is proving to be stable with a minor decline of only 0.6%. Interestingly, Adelaide property prices have increased by 0.7%. Other capitals showing signs of resilience are Hobart, Canberra and Darwin all up between 0.9% and 1.8%.
*All numbers are from 31 March – 31 August. Source: CoreLogic
I had to laugh this week when I read CBA, Australia’s largest lender, had backpedaled on their doomsday house price predictions from earlier this year.
“What has genuinely surprised us is the resilience of house prices in some of the other capital cities considering the negative shock to labour markets around the country.”
CBA now forecasts prices to fall by a smaller amount and to bounce back sharply by mid-next year and predicts annual prices rises as follows…
- Sydney +2.9%
- Perth +1.9%
- Brisbane +1.6%
- Adelaide +1.4%
- Melbourne -0.7%
“Our forecast is for solid price growth in the second half of 2021 as the economic recovery gains traction and incredibly low interest rates once again become the dominant influence on dwelling prices.”
Despite the effects of COVID-19, we can see that from this time last year median property prices in Melbourne are up 5.9%, Sydney is up 9.8% and Brisbane is still providing consistent steady growth at 3.5%. (Source: CoreLogic)
Strength in regional markets
It’s important to remember that the Australian Property Market is not made up just of the capital cities even though media commentary is mostly focused on these markets. Investors that are not considering regional markets are missing out on some of the best locations to be investing at present. Some of these locations, in particular around SE QLD, are proving to be the best performers when it comes to vacancy rates, rents and price. Even through the pandemic, combined regional markets are up by 0.3%. Expert property analyst Terry Ryder confirms this in his recent report “The top 5 Queensland Regional Hotspots for 2020” and it’s no surprise that one of the confirmed Hotspots is The Sunshine Coast.
Personally I know a lot of agents on the Sunshine Coast are currently reporting record months of sales, and several agents are reporting 0% vacancy rates on their property management books. As we come out of COVID-19 and Australians adapt to a new way of life, regional locations with strong and diversified economies are set to continue to perform well and continue on their growth paths. Here at Cameron Bird we are continually brought back to the Sunshine Coast and Moreton Bay Region as the best performers in QLD.
The Sunshine Coast has become the strongest property market in QLD, boosted by the strengthening of its economy and major spending on infrastructure. In the past 5 years 20,000 new jobs have been created on the Sunshine Coast, with continued new infrastructure like Maroochydore CBD and a new International Broadband Cable to name a couple. This process is set to continue with several major projects in the pipeline.
Don’t hesitate to reach out to find out more about our current work in the Sunshine Coast and SE Queensland.