Herron Todd White Month in Review - June 2018
Welcome to the approach of EOFY. This mid-point of the year is an excellent time to take stock and see where the remainder of 2018 will lead. There are some significant events ahead for the rest of this year–the possibility of a Federal Election remains on the cards as at the time of writing–so gearing up to see out the annum is important. This month, the Herron Todd White offices have provided a comprehensive guide on how our nation’s property markets are performing, and where they're likely to go in the next six months. Brisbane’s stable property market performance is on display once more as we approach the middle of 2018. There were expectations that Brisbane could ramp up beyond national averages when it came to price gains – perhaps even become a capital growth leader among our major cities. There was certainly some indication at the end of 2017 that signposted a heap of promise, but a confluence of factors has resulted in our town’s performance so far this year being best described as steady.
One of the key indicators well worth watching is Queensland’s net interstate migration number. Historically when this figure is on the rise, Brisbane housing gets a value boost. At the market growth peak in 2003, there were over 25,000 extra residents joining the Queensland ranks from other states and territories. That figure plummeted post GFC. The silver lining is that we’re now well and truly tracking on an upward curve after coming off this low base.
It’s doubtless that many of these buyers are affordability migrants – those now priced out of Sydney’s real estate market who are keen on relocating to Queensland and enjoying the lifestyle. Best of all, many are selling up their Harbour City abodes and buying here mortgage free and with a big chunk of change left over. That said, many new Queenslanders are moving to lifestyle centres rather than the capital. Regions such as the Sunshine and Gold Coasts have been major beneficiaries of population growth – and they’ve got the value gains to prove it.
In addition, the popularity of our relatively affordable inner city suburbs with this new southern crowd is evident. Translation? While inner-Brisbane addresses have done well over the past year or so, strong price growth hasn’t necessarily extended through to the further flung suburbs.
Another tough metric for Queensland is employment, which remains soft. There is a glimmer of hope though, with big infrastructure spends on the cards that might well help drive job numbers higher. The impact of continued low-interest rates is a general positive for our market and a recent relaxation in rules governing investor loans only bodes well for those wanting values to rise. To read more about Brisbane's property market, head to page 38 of the report.