According to Domain’s chief executive, Australia’s underperforming real estate markets are showing signs of improvement.
Domain CEO Jason Pellegrino told analysts on Friday that “significantly underperforming markets, particularly Queensland in FY24, will turn around and accelerate.”
“You’re seeing the same patterns as we see elsewhere – price growth substantially outpacing the market in Queensland, and that will lead to listings growth in front.”
Queensland real estate listings were significantly below the state’s five-year average in 2023/24, Mr Pellegrino said, predicting that they would rise in 2024/25.
Sydney and Melbourne will continue to enjoy strong growth, according to Domain. (Photos by Mick Tsikas/AAP)
The listing volume in Sydney and Melbourne in 2023/24 was slightly above their five-year averages, and Mr Pellegrino expected the growth to continue.
The Sydney and Melbourne markets aren’t materially decelerating, and early signs of a positive spring are emerging in those markets, he noted.
According to Domain, listing growth is expected to be in the low single digits in 2024/25.
The number of new “for sale” listings increased by four percent in July.
The company also reported a full-year profit of $42.4 million on Friday, up 27.9 percent from last year, but below analyst expectations of $49.4 million.
Its revenue increased 13.1% to $391.1 million, and its earnings before interest, tax, depreciation and amortization (EBITDA) rose 26.2 percent to $137.1 million.
Domain will pay a fully franked four cent per share final dividend, unchanged from last year.
In early trading, Domain shares surged as much as 8 percent, but by 11.15am they had fallen 0.7 percent to $3.07.
There are five Queensland regions that have been identified as “stand-out” investment hotspots and labelled as the next places to buy “before the boom”.
According to InvestorKit’s Overvalued or Undervalued research, the top affordable locations will boom over the next 12 months across capital cities and regional areas.
According to InvestorKit founder Arjun Paliwal, over 80 percent of overvalued cities and regions experienced a housing price decline last year. Over 90 percent of undervalued cities and regions experienced average growth of more than 7 percent.
While the Australian housing market has certainly been tough, our data suggests there are still opportunities to find a growth investment at an affordable price if you look for undervalued markets with solid fundamentals.”
In Queensland, InvestorKit recommends Bundaberg, Townsville, Rockhampton, Warwick and Gatton for investors.
“The local economies of these regions are either strong or strengthening,” Mr Paliwal said.
Their unemployment rates are at their lowest level since over a decade ago
There is a rapid increase in GRPs (gross regional products) and population growth rates in all of them are higher than the last five years.”
The high demand in each of the regions identified contributed to limited supply, and Mr Paliwal added that each town had great growth prospects in addition to being affordable. All five regions have low inventory levels, under three months of stock, indicating high market pressure.
In comparison with pre-Covid times, there is a decline in available stock on the market.”
According to the LGA, Bundaberg is the most expensive; Townsville is the most expensive; Rockhampton is the most expensive.
The median house values at a suburb level in Warwick and Roma were $395,000 and $430,000, respectively.
Compared to Melbourne, the median house price in Brisbane LGA is now $1.1 million.
In Queensland, tight rental markets have created more demand for rentals, according to Mr. Paliwal.
According to REIQ’s Residential Vacancy Report for March 2024, vacancy rates in Queensland were as low as 0%, with rental availability remaining dangerously low across most of the state.
There is a rapid increase in rents in these regions, according to Mr Paliwal.
The crisis-level vacancy rates in four out of five regions are less than one percent, while the vacancy rate in the fifth region (Gatton) is below the two percent high-pressure benchmark.
We expect the fast-growing rental prices, coupled with the affordable housing prices and high yields, to drive more renters to buy and attract more investors, driving housing values upward.
Recent research by Digital Finance Analytics (DFA) found that close to one million households in Queensland were under financial stress due to the housing crisis and rising costs of living.
More than 320,000 homeowners (more than 45%) in the state were in mortgage stress, spending more than 37 percent of their income on home loan repayments, while nearly 490,000 tenants — 72 percent — were in rental stress, spending an average of 36 percent of their monthly income on rent.
According to Finder, a Queensland school leaver would need to save for 21 years to afford a house deposit.
Graham Cooke, Finder’s head of consumer research, said: “The days when one income earner and a stay-at-home parent could raise a family at home are long gone.”
“Wage growth simply isn’t keeping up with skyrocketing property prices for most people.
“The bank of Mum and Dad makes it easier for some to enter the real estate market, but not all will be able to do so.
According to Paliwal, Queensland remains affordable when compared to other states on the east coast, despite the dire results of both research projects.
The southeast Queensland (SEQ) cities of Brisbane, Gold Coast, and Sunshine Coast are among the most expensive markets in the country.
It is primarily due to incoming migrants from the two major capital cities and overseas that they are so hot.
Prices are approaching the affordability ceiling, which will slow down house value growth.”
Meanwhile, he noted that other parts of the state are more affordable.
According to him, 23 of the 26 SA3 regions outside of SEQ have a median house price under $650,000, while 19 have a median house price under $500,000.
There is much room for improvement in these regions since their last 10-year growth is much lower than the long-term average.
Many of them are very hot due to the combination of affordability, lifestyle, and thriving local economies, so hot that many buyers fear missing out on a great deal.
According to Mr Paliwal, Queensland’s population and economy are among the fastest growing across all states, as well as its property market.
The markets in SEQ and the rest of the state, however, are very different.
Property in these regional centers is a compelling alternative to expensive properties in Sydney.
Several are well located between Sydney and Canberra, making them accessible to major cities.
These regions also benefit from diverse local economies.
Post-pandemic, regional housing markets in Australia are thriving. Even though the manic growth levels and Covid-driven tree and sea change trends have subsided, regional housing markets still hold significant appeal for many Australians.
“The number of rising markets in regional NSW has increased recently, so 2024 has started with good momentum in many locations,” Graham said.
“NSW is a large state, and there are many different scenarios at play, including markets that are growing strongly, others that are growing moderately, and others that are still struggling.”
Hotspotting, Tim Graham
In late 2018, the PropTrack Home Price Index (HPI) showed that Australia’s combined regional prices reached a peak with annual growth of 2.06% and a median value of $618,000.
According to CoreLogic’s Regional Market Update earlier this year, Australia’s regional housing market growth surpassed that of the capitals, by 1.2% for the combined regions and 1% for the combined capitals.
Reports last year indicated that flight to regional Australia was not just about connecting with nature, but also about finding cheaper housing. There have been strong career prospects across regional centers, and remote working is also an option for those seeking to retain jobs in major cities.
It is estimated that capital-to-regional migration increased by almost eight percent during the period covered in the report, the third highest rise in people looking for a regional move in the past five years; indeed, Sydneysiders made up the majority of those looking for something outside of the big city.
City of Wollongong and neighbouring LGAs Shoalhaven and Shellharbour make up the largest market in Regional NSW, according to Ryder.
Those three municipalities form a growth cluster south of Sydney, with many individual suburbs and towns experiencing positive trends in sales and prices.”
Sydney is expensive, so this is a great alternative
Aside from some of Australia’s largest and most important regional cities, Regional NSW also has appealing sea change towns, attractive hill change enclaves, industrial centres, strong multi-purpose inland cities, lifestyle regions, and price ranges to suit all budgets,” Ryder said.
The region’s property markets are also supported by one of the nation’s strongest economies.”
Hotspotting by Terry Ryder
As part of that growth-state economy, there has been a large program of infrastructure development, such as the $31 billion Inland Rail Link, which has been energizing the market along its construction route.”
According to Hotspotting, there are five regional housing hotspots in New South Wales that should be targeted by homebuyers and investors. The analysis considers sales activity, buyer demand, and major infrastructure projects, as well as rental market metrics.
The five hottest property markets in regional NSW
Wollongong
Wagga Wagga
Orange
Tamworth
Goulburn
Regional centres are often vibrant and diverse hubs of activity. These hubs typically had major tertiary education institutions, along with a diverse mix of industries from manufacturing to tourism, health to defence, and logistics.
Wollongong
Wollongong, which is two hours south of Sydney, is a thriving city with far more to offer than steel production.
A shift in tourism, commerce, health, and education, as well as the rise of shared services, has helped Wollongong diversify its economy.
According to Ryder, Wollongong is fourth in popularity among capital city residents, after the Gold Coast, the Sunshine Coast, and Greater Geelong.
In response to the growing demand, new apartments and land packages are being developed on the outskirts of the city.
According to Ryder of The Property Tribune, the regional New South Wales rental market is booming, with vacancy rates at record low levels, making it particularly attractive to investors.
“In fact, the city has maintained a vacancy rate of below 3% for 15 years and currently has a vacancy rate of less than 1% in most of its suburbs,” he said.
Wagga Wagga
Five hours southwest of Sydney or three hours west of Canberra, Wagga Wagga is gaining popularity due to its affordable lifestyle, access to employment opportunities in education, healthcare, and the defence force, as well as promising growth in the housing market, according to Hotspotting’s Tim Graham.
With a consistent 10% increase in median house prices, impressive yields, and low vacancy rates, the region has attracted not only those looking to escape city congestion and high costs, but also a growing population of construction workers and first-homebuyers,” Graham told The Property Tribune.
“This strategic inland city with a $4.8 billion gross regional product and a committed $93 million Capital Works Program is not reliant on mining and has multiple economic drivers for sustained growth.”
Tim Graham, Hotspotting
Graham said major developments, such as a new logistics hub and upgrades to military bases worth over $1 billion, are driving the positive momentum in the local economy, leading to a strong property market.
“With housing prices at less than half of those in Sydney, the popularity of Wagga Wagga as a desirable location is expected to continue, with its thriving wine industry, sporting culture, and vibrant festival scene adding to its appeal,” he said.
Orange
Three and a half hours west of Sydney, or a short hop from Bathurst, Ryder said Orange offers a tranquil countryside lifestyle with affordable housing and a diverse range of industries, making it a top investment location.
“This regional city has seen an influx of residents due to the Exodus to Affordable Lifestyle and COVID regional rush trends,” he said.
“As it evolves, Orange has emerged as a prominent hub in New South Wales.”
Terry Ryder, Hotspotting
“This charming city also boasts renowned wineries and a buzzing food scene, attracting visitors from Sydney for a weekend getaway.”
Orange is also home to a Charles Sturt University campus, a sprawling public hospital, and government offices.
“With a thriving agriculture and manufacturing industry, as well as a growing renewable energy zone, Orange provides ample employment opportunities,” said Ryder.
“The city’s housing market, with prices nearly half of Sydney’s, is further bolstered by its industry diversity.”
With its idyllic lifestyle and affordable market, Orange is a coveted destination for both investors and homebuyers looking to make a move to the regions, said Ryder.
Tamworth
Five hours north of Sydney, Tamworth is experiencing rapid growth with major infrastructure projects worth billions of dollars underway, according to Graham.
“The Tamworth Global Gateway Park, equipped with an intermodal freight hub, is expected to be a key contributor to the economy of New England,” he said.
“The city is also becoming a hub for renewable energy developments, with projects worth more than $10 billion in the works, including a Big Battery facility.
“With a diverse economy driven by industries like agriculture, mining, tourism, aviation, and healthcare, Tamworth is set for further growth with the planned opening of a University of New England campus in 2026.”
Graham said the city’s strong tourism and equine industries are also major economic drivers, boosted by renowned events like the Tamworth Country Music Festival.
“Its affordable cost of living, peaceful rural lifestyle, and well-established facilities make Tamworth an attractive destination for those looking to escape the hustle and bustle of major cities,” he said.
Graham said the city’s strong tourism and equine industries are also major economic drivers, boosted by renowned events like the Tamworth Country Music Festival.
“Its affordable cost of living, peaceful rural lifestyle, and well-established facilities make Tamworth an attractive destination for those looking to escape the hustle and bustle of major cities,” he said.
“With a resilient property market that showed consistent or increasing sales during and after the pandemic, Tamworth’s appeal as a lucrative investment opportunity is expected to continue into 2024.”
Goulburn
Ryder said Goulburn’s property market has shown steady growth since early 2020 and is expected to continue its solid performance this year and beyond.
“Although the sales activity has slowed in recent years, Goulburn remains an attractive and affordable lifestyle market, particularly appealing to first-home buyers,” said Ryder.
“The region has recorded a consistent annual capital growth rate of 8%, making it a favourable option for both houses and units.”
Ryder said its location between Sydney and Canberra ensures Goulburn also benefits from the influx of buyers who have been priced out of these major city markets.
“With affordable housing and ongoing developments to improve transport routes, the region has gained the attention of both owner-occupiers and investors,” he said.
“As a well-established regional centre, Goulburn has a strong and diverse local economy, driven by sectors such as healthcare, retail, construction, agriculture, and tourism.”
Queensland’s new ‘golden triangle’ has seen a wave of southern investors return due to an infrastructure boom and skyrocketing rental yields.
Located between Logan, Ipswich and Beenleigh, the still affordable hotspot encompasses some of the last remaining pockets in the region where you can buy a home for under $700,000 and rent for $350 per week. Experts say these two key ingredients have driven a 25 percent surge in investor activity each year.
It follows an almost two-year slump fuelled by the 2022 Queensland land tax reforms and rising interest rates, which scared off scores of investors. Instead of just the Queensland land holdings of investors, the reforms – scrapped later that year – would have assessed the land tax rate for investment property across Australia.
As the Sunshine State collects record interstate migration and major infrastructure investment ahead of the 2032 Olympics, savvy Sydney buyers are particularly interested in Brisbane, a city considered one of the nation’s top investment destinations. Rent yields are through the roof in that new golden triangle, and the lion’s share is being attracted there.
Based on Domain’s April Rent Report, Logan City boasts the highest rental yield in south-east Queensland at 7.66 per cent, with median weekly rents rising 20 per cent to $360 per week. Eagleby units ranked second with a rental yield of 6.72 percent, with rents increasing 16.7 percent annually to $420.
Compared to Brisbane, Sydney’s average unit rental yield is 4.67 percent, while Brisbane’s is 5.5 percent. Domain’s report indicates a national average of 5.1%.
Increasing rents have brought bucketloads of investors back to the capital of Queensland, according to Sam Gordon of Australian Property Scout.
According to him, there has been a 25 percent increase in investor activity over the past six to 12 months.
“I see Brisbane as having longer-term growth due to the amount of infrastructure being built and the number of people moving there.”.
“They’re looking at spending about $700,000, and that’s why Logan and Ipswich are getting so much attention.
As a result, Brisbane has become one of the top investment destinations. Although Perth is considered the hottest market, Brisbane is hot on its heels… but there is a lot of demand because of those yields, as well as a lot of competition from first home buyers.
According to Gordon, his most savvy investors snag off-market deals on “ugly ducklings” at a time when they could add value.
As a result of population growth and the housing shortage, Brisbane’s economy should remain strong for the next 12 to 24 months.
It’s tough for us right now to compete with client expectations of what they can get for their money due to the fact that what was sold for $500,000 a year ago is now selling for $600,000.”
Investor activity in Zevesto’s sought-after patch has indeed ramped up, but investors struggle to compete with hungry owner-occupiers, said Rob Ford, Founder and Director of Zevesto.
Increasing rents drove the investor crowd – largely from Melbourne and Sydney – and granny flat properties were in high demand.
“Our rental renewals increased by 18 percent across the board, which tells us there is a shortage of rentals … and a huge number of people are moving into South East Queensland, so I believe demand is the driving force,” Ford said.
Although there’s debate about whether rates will rise or fall, investors now have a good deal of certainty.”
There is a high demand for properties with auxiliary units or granny flats in Logan, Marsden, Boronia Heights and Woodridge, according to Ford. Now, they faced a major challenge due to a lack of housing.
There is about a 20 percent reduction in stock levels compared to the long-term average, and that’s consistent across the entire company inventory. As long as demand remains high, the entire industry will be tight.
I would probably invest $500,000 in Eagleby if I had $500,000 to invest right now.”
Although Brisbane’s bargain boroughs are big investors’ magnets, Domain’s Rent Report showed traditional inner-city tenants’ hotspots still offer good rental yields. After climbing 22.8% annually to $700 per week, Brisbane City units sit at 5.97 percent.
Brisbane looks great because interest rates have softened a little bit and rents have increased, which makes it attractive to negatively geared investors, and if you have to borrow less and get a higher yield, you will be making more money,” said Cush.
Investors are returning because the entry barrier has been lowered. Brisbane’s CBD is 15 minutes away, while Sydney’s is 15 minutes away.”
Houses are a hot commodity because of their higher capital gains than units, according to Cush. Nevertheless, he said suburban areas such as Nundah, which were close to the city and had a good housing mix while being close to public transportation, were some of the best places to invest dollars.
With Woolloongabba’s huge transport services and shopping precincts, Chermside was another hotspot where savvy investors had their dollars invested.
A strong Brisbane economy and higher capital gains are spurring investors back into the inner-city property market, according to Ray White New Farm Principal Haesley Cush.
As far as suburbs are concerned, I really like the ones that have infrastructure around the city right now. Conditions are excellent (for investors). In Cannon Hill, there’s a good shopping precinct, and as the city develops, it sits in a sweet spot,” said Cush.
According to Mish Daniel of Revolve Commercial, her team clocked up a colossal investor spike of more than 50 percent over the past two years.
The reason for that might be due to a couple of factors. The city hasn’t traditionally been regarded as a growth capital and Queensland is cheaper than its southern counterparts,” she added.
Investors have found it very palatable because of that. A housing shortage is driving up prices in Queensland and so much unexplored territory is attracting investors.”
There is a larger ‘golden triangle’ between Toowoomba, Sunshine Coast and Gold Coast, which makes it a prime property market for southern punters.
In Toowoomba, we have seen a huge spike in the economy by itself. In addition, there will be a lot of capital expenditures.”
With recent figures from the 2022/23 financial year demonstrating Maitland’s status as the fastest-growing regional area in New South Wales, it continues to experience rapid growth and significant investment.
The Maitland City Council approved more than 1,180 development applications in 2022/23, creating 1,147 acreages of new housing.
The average processing time for a DA was just 27 days – a metric that ranks among the fastest in the state.
Approximately 880 new greenfield lots have been released following the completion of more than $85 million in subdivision work by developers and the approval of subdivision certificates by Council.
‘This is significantly more than the average of 700 lots a year over the past five years,’ said Maitland City Council General Manager Jeff Smith.
A total of 800 lots are currently under construction, 1,100 lots are ready to begin construction, and more than 2500 lots are seeking approval for development, according to Mr Smith.
It is evident from these figures and the pipeline of future projects that Maitland has the potential for sustained economic growth and prosperity.
Investing and homeowners recognize Maitland’s potential as a great place to live, which indicates our continued growth as the fastest-growing area in the state.
It was announced recently that Maitland City Council has approved its new Local Housing Strategy 2041, which focuses on establishing new neighbourhoods holistically, according to Mayor Smith.
In order to continue growing our city, we must consider both the natural environment and livable infrastructure.
Council’s efforts in managing DAs and greenfield lots with local stakeholders and agencies were praised by Mr Smith.
By creating great development outcomes, we aim to maintain the balance between progress and preserving our city’s character.
Jeff Smith, General Manager
Through our Capital Works Program, we have made significant investments in local infrastructure to support forecasted growth.
The Maitland City Council’s 2023/24 works program includes $19.7 million in major roadworks, $9 million in road rehabilitation and resurfacing, and $11.4 million and $29 million in building and recreation projects.
There are several major community infrastructure projects in the pipeline for the upcoming years, including the $26 million Raymond Terrace Road project for traffic congestion reduction, the completion of Harold Gregson Park upgrades at Maitland Regional Sports Complex, upgrades to Thornton roads and intersections, new community centers in Tenambit and Chisholm, new sportsfields in Chisholm and Lochinvar, and a skate park and play space at Roy Jordan Oval in Gillieston Heights.
Woodgate is considered one of the Fraser Coast’s most prized stretch, simply because it has it all. Set along 16km of white sandy beach that backs on to the Burrum Coast National Park and amid some of Queensland’s finest fishing zones.
This secret beachside location is nestled within 800m of the Beach from your Eastern Boundary, this is the perfect place to invest or retire. This is a land release that won’t last long, due to its position between the Bruce Highway, Bundaberg, Hervey Bay and Fraser Island – a private slice of paradise where everything is within reach.
Drift Woodgate Beach is where private blocks are big enough to live the dream you’ve always wanted. And it’s all within reach. Drift is all about space. You have space to breathe, space to build, space to create, space to park your boat, space to build your shed, space to take it all in.
Drift Woodgate Beach is a place to step off the treadmill and live! A paradise where life is as spectacular as it is simple.
Whether it’s strolling along the shores with the kids or the dogs, Drift has been master-planned to blend seamlessly with an existing beachside community where old time values are still appreciated, where people still say g’day, where life is uncomplicated and goes along at the pace you want.
At all times, Woodgate is a place reminiscent of a classic beach holiday, where you can get a burger at the cafe, or take in a cleansing sundown ale at the Woodgate Beach Hotel, and always with World Heritage Fraser Island in the near distance.
All blocks are fully serviced and have access to:
– Underground electricity
– Sewer
– Town water
– NBN connection available
– Within easy walking distance of the Beach via your choice of paved walkways;
– Short stroll to Shopping centre, Chemist, Medical Centre and Hardware store
In 2020, Bhavi Desai purchased her first piece of real estate. Since then, she has acquired nine more properties, accumulating a portfolio of $10 million.
She has secured a 15 per cent rental yield on her highest cash-flow property to house participants in the fast-growing National Disability Insurance Scheme (NDIS).
“I should be able to reach 25 [properties] without too much stress … after that, I will have to work my magic to keep going,” the Sydneysider said.
AFR Weekend’s analysis of annual Tax Office data shows the 46-year-old investment lending manager is among 20,000 so-called “super investors” who own six or more properties. In 2021-22, hardcore property speculators made an average rental profit of $15,900.
Despite owning just 1% of the 2.27 million rental properties, super investors bought 4.6% of all investment properties with 151,086 properties between them.
Ten percent of investors had at least three properties, and collectively, they held one quarter of all rentals.
With her growing confidence in her investing abilities, Ms Desai began purchasing non-standard assets, including the property that will house NDIS participants next month.
Cash flow was the main reason for buying this NDIS property. Approximately 15% of the rental income is generated there. This is one of the advantages of owning a NDIS [property].
In addition to holding high-growth, low-yield properties, Ms Desai also purchased lower-growth assets with healthy cash flows.
Investors were increasingly likely to be positively geared as they purchased more assets, according to ATO data. Approximately two-thirds of super investors were cash-flow positive in 2021-22, meaning their rental income exceeded various expenses, including interest and strata fees.
However, after 13 interest rate increases by the Reserve Bank of Australia since May 2022, Ms Desai said her portfolio is now negatively geared.
Ms Desai’s “biggest hit” came in 2023 when her fixed terms expired and a 2.5 percent interest rate went straight to 6.5 percent.
While negotiating Labor’s housing shared equity scheme, the Albanese government has said it will not change negative gearing.
In spite of owning ten properties, Ms Desai lives in a rental apartment with her husband. Originally, the couple planned to buy a property for themselves to live in, but in 2020 they switched their focus to investing.
“I wouldn’t describe it as easy. Her advice was to increase your income constantly to be able to support [more borrowing].
Rental property expenses recorded by the ATO in 2021-22 totaled $43.8 billion, with loan interest ($15.8 billion), capital works deductions ($4.3 billion), and council rates ($3.9 billion) being the largest.
She said although her investment journey had been fairly smooth, there had been a few obstacles along the way, such as issues with valuations preventing her from securing financing.
The portfolio’s $10 million value is equivalent to about 50% of her debt, so Ms Desai doesn’t worry about something going wrong.
As long as they can, she and her husband will continue to invest.
There is a lot of pressure on my son right now. As soon as you turn 18, I will give you a mortgage as a birthday gift. I’ll pay your 20% deposit, but you must earn enough to cover your mortgage.”
Brisbane and Perth, respectively. There’s no doubt that both cities are rocketing to record real estate prices, but the question on everyone’s lips is: Will they last?
House prices in both cities rose roughly 1.5 times faster than they did the previous quarter and doubled from a year ago, according to the Domain House Price Report.
As a result of that acceleration, Perth’s annual growth reached 23.8 per cent – the highest level in 17 years – and Brisbane’s reached 16.9 per cent. In spite of this, it’s unlikely that boom times will lead to busts.
According to Domain chief of research & economics Dr Nicola Powell, this is the steepest rise Perth has ever experienced.
Despite the fact that this rate of gain won’t be sustainable in the long run, we expect strong growth to continue in the future due to a shortage of stock and strong demand from the population.
The price of houses in Brisbane will also rise, but not at such a high rate as in Sydney. Over the next quarter, they will surpass the $1 million median and it will only take an additional 2.4% increase.”
According to other experts, both cities will continue to offer good returns to investors and excellent capital appreciation for investors, with Perth’s new house price median at $852,240 and Brisbane’s at $976,464.
The population of West Australian state has grown by over 3 percent in the last 18 months, with most migrants settling in Perth, according to Damian Collins, founder of property investment company Momentum Wealth.
Furthermore, the stock is at its lowest level in almost 20 years.
“Our economy here is also very strong, and we have a lot of jobs,” Collins says. “For a long time, Perth’s property was ridiculously cheap, but we’re now rapidly catching up with other capital cities.”
In the long run, it will come back to a more sustainable level – it can’t keep growing at 20 percent a year indefinitely. It is still possible to get a 5 percent yield on rental properties, and rental laws in these states are much more balanced than they are in NSW, Victoria, and Queensland.”
Investors are also attracted to Brisbane, where strong migration is also supporting property prices, as is the infrastructure spending and soaring confidence ahead of the 2032 Olympics.
FW valuers’ Brisbane director, David Notley, says the Brisbane market is expected to continue to be strong, providing that fundamentals do not change, such as an under-supply of stock, corroborating with migration levels that drive up prices.
InvestorKit’s founder and head of research Arjun Paliwal believes most of the growth has come from the lower end of the Perth and Brisbane markets between $400,000 and $800,000.
According to him, higher-end property prices will likely rise in the future.
According to Paliwal, investors in that bracket may well benefit from further price growth between $700,000 and $1.5 million.
Although both cities have seen considerable growth already, there are still pockets that remain fairly affordable, and rents have held steady, so yields have risen as well.”
This dual living property is for sale at 16 Weston Court, Bellbird Park.
When Kathryn and Marcus Backway built this dual-living investment property two years ago, they knew they were on to a sure thing.
The property at 16 Weston Crt, Bellbird Park, has never been empty and currently generates a solid rental return of $520 a week.
One of the kitchens at 16 Weston Court, Bellbird Park.
It’s two homes on one 402 sqm title — a three-bedroom, two-bathroom house and a one-bedroom, one-bathroom home.
“We knew dual living was the way of the future,” Mrs Backway said.
“You could put a family in one side and elderly parents in the other, or a young family could live in one home and rent the other one out to help pay the mortgage.”
The living room at the larger house at 16 Weston Court, Bellbird Park.
Each home is currently rented out to separate parties.
Mrs Backway said the couple were selling to pursue other investment opportunities interstate.
Tucked away at the end of a quiet cul-de-sac, the property is in a high growth corridor with infrastructure close by, ensuring a solid investment.
One of the bedrooms at 16 Weston Court, Bellbird Park.
Inside, the homes feature a modern design with tiled, open plan living areas, carpeted bedrooms, separate entrances and fenced yards.
Both kitchens feature stone bench tops and stainless steel appliances.
Unlike some duplexes and townhouses, there are no body corporate fees.
One of the bathrooms at 16 Weston Court, Bellbird Park.
The property is also lower maintenance than owning two separate rental properties.
Mrs Backway said the majority of inquiries had so far come from investors, who recognised the growing appetite for dual living as the population aged and downsizing became more popular.
“I think it will only continue to grow as the demographics change,” she said.
Despite rising house prices in the Wide Bay region over 80 percent since 2020, experts say they’re still comparatively affordable.
Regional house prices and rental markets are under pressure due to migration.
Where do we go from here? People are looking for “the next Sunshine Coast” and discovering “hidden gems” like Bargara, Moore Park Beach, and Burnett Heads.
Property prices in a sleepy beachside town have soared by more than 80 percent in four years, but an analyst says it’s still “extraordinarily cheap” compared to those in capital cities.
Moore Park Beach in Bundaberg is five hours north of Brisbane, nestled between cane fields and the ocean.
Following a lifestyle change last year, Ms King, 28, and her husband are among the area’s newest residents.
Their mortgage in Brisbane was swapped for an “oasis” complete with kookaburras and a private beach.
“We found this beautiful little town at Moore Park Beach, just 20 minutes from Bundaberg, and found this beautiful house,” she said.
Price comparison
According to PropTrack data, regional Queensland is experiencing the strongest market since the pandemic onset, with home prices surging by 66.5 percent since 2020.
Wide Bay between Gympie and Bundaberg topped the list with values soaring by 80.5 percent.
More than 70 percent of house values rose in Ipswich, Logan-Beaudesert, and the Gold Coast as well.
The median house price in Bundaberg is $522,607, Gympie is $629,775 and Maryborough is $484,153, according to Corelogic.
There is a median price of $1,461,581 in Noosa, and a median price of $817,564 in Greater Brisbane.
As a result of the pandemic, coastal areas have experienced extraordinary growth, according to CoreLogic research director Tim Lawless.
There has been an increase of 82.5% in home values at Moore Park Beach – one of the more affordable coastal suburbs in the Wide Bay region.
In spite of the increase, Mr Lawless said coastal homes in the region were still affordable.
The median or house value at Moore Park Beach or Bargara or Innes Park is still well below $750,000, he said.
“Compare that to a coastal market around south-east Queensland and you’ll see that it’s extremely inexpensive.”
Increasing prices
Migration was a major factor putting pressure on the regional property market, as well as the rental market, although it had slowed in the wake of the pandemic.
Mr Lawless said Queensland is seeing a very strong influx of migrants from interstate as well as overseas.
Despite the fact that regional Queensland is mostly driven by interstate migration, overall population growth is still very strong in the region.”
According to him, there is not enough housing supply to meet demand.
According to Mr Lawless, the number of new homes being built is insufficient to accommodate the number of people moving to the state.
“This means we are seeing … constraints both in the purchase of homes, as well as in the rental of homes, since rental rates are also rising consistently and rapidly.”
A Bundaberg real estate agent said the local market was attracting buyers who had sold and made profits elsewhere, and were seeking a beachside lifestyle at a lower cost.
He said they were looking for the next Sunshine Coast.
The little hidden gems of Bargara, Moore Park Beach and Burnett Heads are starting to gain popularity.”
A traditional characteristic of the region is its “slow and steady” market pace, which appears to be returning after the pandemic boom.
Hotspot of the future on the coast
The Sunshine Coast’s James Jenkinson has purchased land at Bundaberg’s Innes Park and plans to build a house and relocate with his family.
Coastal lifestyle and planned infrastructure projects, including the new $1.2 billion Bundaberg Hospital, attracted the owner of a pipeline plumbing construction company.
In the early 1990s, he compared Bundaberg to areas along the Sunshine Coast.
Initially, we intend to move to a rental and then start building.
The only negative I can mention is finding rentals in Bargara can be a little challenging.”
Beaches instead of Brisbane
They built their first home in Mango Hill before the pandemic and sold it last year to move to Moore Park Beach.
The experience of living here has been absolutely amazing, she said.
My backyard does not normally have turtles laying eggs, but I saw them laying eggs last December.
Through a “security swap”, Ms King said they were able to transfer their mortgage with their lender.
Mortgagees can keep their existing loan structure by changing the property used as collateral.
Our mortgage was not changed, but since the property we bought in Moore Park Beach was at a lower value than what we sold in Mango Hill, we were able to keep the same mortgage,” she said.
Despite the fact that we are not better off financially, we are in a better physical, mental, and emotional place.”
