As per usual, the media has had a lot to say lately about the local market with different publications touting different angles on what we are likely to see happen in property over the coming months and years.  We have seen whispers of oversupply, vacancy rates have been questioned and while it is all very interesting – at HS Brisbane Property, we are more concerned with factual data.

To get a truly good grasp on what is happening in our local market, firstly we have to break it down correctly.  Often we see in media articles the Brisbane CBD and the surrounding inner city suburbs all thrown into the same ‘pot’.  They are actually two extremely different markets, with different trends and from a real estate point of view – are two completely different products.

In today’s article, we pin the two markets; Brisbane CBD vs Inner City Suburbs against each other to see exactly how each stacks up - to assist you in choosing where to make your next investment!

Let’s start with one of the media’s favourite current ‘buzzwords’.  Oversupply.  Currently Brisbane is in a growth upswing, in the past few years we have had more infrastructure established across our capital than ever before – think of the number of bridges and tunnels opened, new commercial buildings erected and upgrades to motorways and highways happening.  All of this has been done with good reason, our population is soaring – with the constant flow of people moving from across Australia to ‘The Sunshine State’ we are continually absorbing more and more people into the region and where there is population change and growth, there is the need for new infrastructure. 

With this of course, comes the need for more housing – more units, more homes, more apartment buildings.  So while we are experiencing an influx of new developments across Brisbane, it really does suit the current theme of ‘expansion’ in all areas across the region.

The best way to quantify the current number of dwellings and whether our level of supply matches the level of demand, is to take a look at the vacancy across the different areas.

This is where the Brisbane CBD truly shines above the competing areas of the inner suburbs.  In the recent data release from the REIQ, vacancy rates for the CBD were sitting at a very healthy 2.7%.  When we take a look back to 2013, when the rates were closer to 3.2% you can see that even though we have seen new buildings developed across the city, the demand for properties to rent in the middle of town is extremely high and people investing in the city are in an even strong position today!

Now lets compare these figures to that of the Inner City market (suburbs such as New Farm, Teneriffe, Toowong, Red Hill etc).  While back in 2008 these areas enjoyed a vacancy rate of just 2.6%, we are now seeing them sit around the 3% mark, much higher.  It is these areas where the majority of the developments are happening in the near future which begs the question, what could happen to vacancy rates in this area as we move into the future.

This week we did a quick investigation using one of the leading property portals, www.realestate.coma.u and had a look at the current number of residences offered for rent in the CBD vs the Inner City market. 

Currently in the CBD there are only 285 units available for rent, when you consider there are around 9000 units in the city, this is quite an impressive number.  When we switched our search to the inner city suburbs we found over 1,440 for rent, over four times the amount available.

What do this mean for investors?  This is great data to arm yourself with when choosing ‘where’ to make your next investment.  In our eyes, the Brisbane CBD is almost unbeatable when it comes to value for money and a solid future investment.

For more information, contact Hannah today on 0419 782 133.

There is a lot of talk about foreign investors buying into the Australian property market at the moment. The million-dollar questions remain… what are they looking for and where are they buying? To help answer these questions, we use research and statistics from the Foreign Investment Review Board (FIRB) to reveal the ‘who’, ‘what’, ‘why’, ‘where’ and ‘when’ of Australia’s international property buyers.

WHO

Who are Australia’s leading foreign buyers? Where are they coming from?

In dollar terms, our country’s top 11 investor markets currently look like this:

1.     China $12,406m

2.     USA $6,135m

3.     Singapore $4,303m

4.     Canada $2,945m

5.     Malaysia $2,038m

6.     UK $1,795m

7.     Netherlands $1,720m

8.     NZ $1,362m

9.     Hong Kong $1,279m

10.   Germany $1,169m

11.   South Korea $1,083m

WHAT

What type of property are these investors buying?

According to the FIRB Report, Australia made $74.6 billion from foreign investment in 2013-2014. This figure is up from $51.9 billion in 2012-2013 and included:

1. a)     $34.72 billion in residential real estate based on 23,054 proposals.
2. b)     $39.88 billion in commercial real estate based on 374 proposals.

It can be established from these statistics that Australia’s residential real estate is showing huge growth from the previous 2012 to 2013 year which saw $17.16 billion made up of 11,668 proposals. Thus, indicating the residential market is up by more than 100 per cent in the previous year alone.

WHY

Why Australia?

Locally we continuously hear in the media, and from industry experts, about how Australian property is starting to get expensive. However, when you speak to international buyers the response to our market is quite the opposite, with many commenting on how our property prices are actually very reasonable.

Just ask Greville Pabst, WBP Property Group CEO and Co-founder, he says that overseas investors find Australia a very desirable location. This is especially the case when looking at it from an education and infrastructure perspective.

“Locals are saying Australian property is getting expensive yet when I speak to buyers from Singapore, Hong Kong, Jakarta, our property is actually viewed as very cheap – a lot of our buyers work for multinationals and are paid in US dollars”, says Pabst.

WHERE

Where are international investors buying?

According to reports it seems that international buyers are buying high-rise apartments in the main capitals, located near quality educational centres – colleges, schools, universities, etc. 

According to Pabst, Asian markets are predominantly buying apartments in the main capitals of Melbourne, Sydney and Brisbane. He explains that foreign-born residents of all nationalities also see high value in established properties near high-quality tertiary and secondary college campuses.

In addition, independent buyer’s agent Catherine Cashmore says that foreign investors are primarily buying high-rise apartments.

What does this mean for the Brisbane CBD?

Home to some of Queensland’s most respected universities, such as the Queensland University of Technology, plus a number of reputable colleges and education facilities, it is no wonder why so many foreign buyers are looking favourably at buying apartments in the Brisbane CBD.

Just this week we have seen articles explode all over the media with the main online Chinese real estate portal Juwai.com touting Queensland and in particularly  Brisbane as the new hot spot for Chinese investors.

You can read more about this in the News.com.au article released this week.

WHEN

Now is an opportune time to buy in the Brisbane CBD. Whether looking to buy or sell, for more information on local Brisbane properties, contact Hannah on 0419 782 133.

In a recent edition of Market News we compared our local Brisbane market to that of Sydney – one of the country’s most inflated real estate markets. This week we head even further south and shift our focus to Melbourne to see just how our local city market fairs with another one of the country’s top performing states.

Yet again, the results prove just another tick in the box for those looking to invest in the Brisbane CBD.  As a recent industry report shows that the average cost to rent an apartment in Brisbane is now on par with Melbourne, even despite large discrepancies in the cost of buying a property in both capital cities.

The Domain.com.au rental report for the recent June quarter shows there has been no relief from escalating rents for Brisbane apartments, with the average price for an apartment now reaching $370. This figure is up by 1.4 per cent on the previous quarter and now brings our state’s price on par with the cost of renting an apartment in Melbourne.

So, as Brisbane renters now pay equivalent to their Melbourne counterparts, one would assume that the cost of purchasing an apartment would also fluctuate. However, this this is not the case. Surprisingly, the cost of buying an apartment here in Brisbane still remains significantly lower than purchasing a CBD apartment in Melbourne.

In fact, real estate investors can snap up a Brisbane property for an average $100,000 less in the Queensland capital than in its Victorian equivalent. Not the best news for those renting however, this kind of positive return on investment is music to the ears for local property investors as well as those wanting to sell their Brisbane apartments.

We can expect to see more and more people, including investors, leave the Melbourne market and head up north to Brisbane.

So once again industry reports indicate that the Brisbane CBD offers great opportunities and a convincing return on investment. For sound advice on how to enter the property market or grow your portfolio, speak to the team here at HSBP or contact Hannah on 0419 782 133 for an informal chat.

Over five years ago the ‘Great Australian Dream’ consisted of buying your own home; your very own piece of land complete with the white picket fence, hills hoist, big old gum tree and room for the kids to run around – that was the dream! While it still is for some, for others it is about more; today first homebuyers want a home they can build a nest egg from.

Nowadays agents (including ourselves) are noticing a growing trend, as many first homebuyers opt to purchase an investment property over a home to live in. In a recent Residential Property Manager article, James Mitchell reports that, according to Mortgage Choice, over 20 per cent of first home buyers are now electing to buy an investment property as their property purchase.

This figure is up significantly on what it was five years ago, according to Mortgage Choice Chief Executive, Michael Russel.

 “They (first homebuyers) are electing to rent in an area they want to live in and can't afford and are investing in an area they don’t want to live in and can afford,” he said.

Here at HS Brisbane Property we are noticing a rise in the numbers locally as well, witnessing that first homebuyers, locally from Brisbane and from interstate, are looking for fantastic investment opportunities to buy apartments here in the Brisbane CBD.

There are many reasons that we are seeing this shift and we explore a few of those below:

Like Russell said, first homebuyers can not always afford to buy where they want to live from the get-go, so buying an investment apartment allows them to get their foot in the real estate market and build some equity first while living (and renting) in an area they desire, ie. the CBD.

Flexibility is another reason we are seeing a shift in this direction. Many buyers want to enjoy the rewards of owning a home but are not interested in the prospect of being tied down to a mortgage and living in just one location. By investing and renting themselves this eradicates any long term commitments in terms of housing. What’s more, many of these new ‘first homebuyer’ investors are choosing to live in rental properties in the CBD because of the flexible and central lifestyle it offers.

Wanting to minimise on living expenses is also a major driver for some first homebuyers who make the decision to invest. By doing so they have the option to keep bills to a minimum by still living at home with their parents, renting a room or finding another rental in a cheaper location.

Another big reason is purely because of the tax benefits that come with purchasing an investment property – e.g. the ability to claim back expenses such as depreciation, etc.  While this shouldn’t be the sole reason behind the decision to invest, it definitely needs to play a part in the consideration process.

Buying an investment property can help first homebuyers to build equity and wealth so that one day they can afford to buy that dream house they have always wanted.

So really, when you look at all the reasons for this shift in the market, it is very smart; it makes complete sense! Highlighting that property investment is one of the best ways to build a nice egg for your retirement.

Plus, let’s not forget the fact that many of these investors generally opt to live in the CBD, which is great news if you are a local city investor with an apartment or two up your sleeve.

First homebuyer or not, when it comes to building your nest egg there is no better place to invest than right here in the Brisbane CBD. Why not contact our team or come in for a chat and see how we can help you with purchasing your next investment property. 

Good news Brisbane! We’ve done our research and it looks like our fabulous city can expect to see an influx of investors as of the beginning of this new financial year. Once again proving that now is a very exciting time to invest in the Brisbane CBD.

Why now? What’s responsible for this new developing interest? Well, according to multiple industry experts, this strong shift appears to be a result of Sydney’s continually rising property prices.

It’s no secret that Sydney’s prices have been on the up for some time but it appears their growth is the biggest it has been for a while. In keeping with a current domain.com.au article by Antony Lawes, he states that Sydney’s property prices have shot up almost six per cent over the first months of 2015 alone – the city’s highest quarterly growth in six years.

Lawes’ article also highlights the CoreLogic RP Data’s latest home values index, which found annual price growth for apartments across the whole of the city was 13.9 per cent for the 12 months to the end of March.

One might think this is a good thing for Sydney… right? Wrong! Property adviser, Jacob Field, from Ripehouse (a company which supplies research and analysis tools for DIY investors) argues that it’s actually quite the opposite of good. Well, unless you’re in Brisbane, that is.

Field says Sydney's recent growth has started to polarise investors from buying in New South Wales. Instead they’ve started heading up to Brisbane’s CBD. In fact, in a recent story on the Property Observer he said that some 80 per cent of his clients were currently targeting Brisbane… this is a huge number!

"It is either encouraging current Sydney investors who have made recent capital growth to diversify into other markets or for those investors that have not yet entered the Sydney market, and now priced out, they are looking out into other markets.

When it comes to buying property, Field believes Brisbane is currently the most convincing recommendation that Australia has to offer.

"However, Brisbane is now perhaps the strongest buy recommendation in the nation and should not be overlooked for growth, all the way through the recovery and growth phases of the cycle."

Adding to that, earlier this year, Field also reported that Brisbane and the South East regions of Queensland were firmly in the recovery stage.

"We have seen some small incremental growth in these two markets to kick off 2015, expect this to escalate and start moving much faster as we progress throughout the year."

So, whether you’re a current Brisbane investor or you’re looking to enter the market, many experts (just like Field and Lawes) are indicating that Brisbane is the place to buy in 2015, and who better to help you with your investment than HSBP?

To discuss future investment options right here in the heart of the CBD contact me, Hannah Schuhmann, on 0419 782 133.