Insights - Brisbane House Market
Brisbane Rental Growth Strongest Since 2008 GFC
Strong interstate migration into Queensland is causing phenomenal growth, with residential rents and house prices soaring in South East Queensland (SEQ).
The growth has been the result of Government grants, low interest rates, strong first home buyer demand, and consumer “fear of missing out”, which are keeping residential demand strong, particularly for new housing in greenfield estates.
Demand from interstate migrants has also been driving the residential market, with Queensland recording the highest national growth rate at 0.85% while the national growth was a paltry 0.14%.
Queensland’s population was estimated to be 5.20 million as at March 2021, increasing by circa 43,933 persons over the 12 months from March 2020.
The latest ABS figures show that new supply was on the rise with 13,041 units and townhouses approved across Queensland during the year to September 2021, increasing by a staggering 32.94% from the 12 months ending September 2020.
Unit and townhouse approvals peaked in 2016, with close to 28,000 units and townhouses approved in the year to April 2016. Due to tighter lending restrictions and regulatory constraints, the apartment market slowed substantially between 2018 and 2020.
Housing approvals increased by 51.78% to 31,079 approvals during the year to September 2021.
Housing affordability is becoming a big concern in many of Australia’s capital cities, including Brisbane, with the massive housing price growth in Brisbane impacting on this issue, particularly in the context of potential rises in interest rates over coming years. This will drive continued demand for rental accommodation.
There has seen strong interest from developers for englobo land due to the low supply and the spike of interstate migration which has increased demand for land in SEQ.
According to Domain, Brisbane’s median house price rose by 15.29% to $702,455 over the year to the September quarter, while unit prices declined marginally to $396,609.
Weekly rents have also grown at strong rates for houses, units and townhouses.
Over the year to September, rents for two-bedroom units and houses saw their strongest annual growth since 2009. Whilst annual growth tapered back in the September quarter for three and four-bedroom houses, growth to the June quarter was the strongest it has been since 2008.