INVESTORS in search of properties that will deliver high capital growth in the years ahead may find southeast Queensland and certain fringe suburbs of Melbourne safe bets.
These regions accounted for the bulk of high growth property markets in Hotspotting.com.au’s latest Top 10 Best Buys report, which forecasts the 10 best locations for property investors seeking capital growth.
Queensland locations in the report included the Gold Coast, Ipswich and Logan, while the Melbourne regions included the City of Casey and Epping.
Just one NSW location was nominated: Wagga Wagga.
No property markets in South Australia or Western Australia made the cut, but Tasmania had a surprising addition in Hobart.
The report said these locations have “identifiable drivers of demand for real estate, which will place pressure on prices and rents … we expect them to show growth not only in 2016 but well beyond.”
GOLD COAST, QLD
Billions is being spent on infrastructure across the Gold Coast in the lead up to the Commonwealth Games in April 2018, which is expected to bring around 690,000 visitors to the city.
Ongoing projects include the $150 million development of the light rail network and a $42 million aquatic centre.
These and other developments have helped create 15,000 jobs over the past year, adding to the city’s already strong population growth. The Gold Coast’s population is projected to grow by 133,800 people in the decade — the largest population growth in Queensland.
“There will be (property) price growth, especially in the genuine residential suburbs,” the Hotspotting report said. Much of this growth is expected to occur in suburbs along the northern corridor between Helensvale and Brisbane.
Logan City’s combination of affordable property prices, good infrastructure and proximity to job hubs could boost home values.
Many of the region’s older suburbs have been revitalised through urban renewal projects and Logan is already one of the fastest growing municipalities in Australia.
It is being expanded through a $4 billion masterplanned housing community on Waterford Tamborine Road, which will result in 17,000 new dwellings.
There is also a $600 million project to redevelop Jeta Gardens Retirement Village, approved by local council in 2014. The village currently injects $10 million into the local economy annually, but this is set to rise to $100 million.
Tasmania’s economy is rising on the back of big improvements in tourism and business investment after years of lacklustre economic activity.
The property market has started to respond, with sales activity steadily improving since 2012.
Hotspotting pointed out that Hobart presents an attractive package to investors, with high rental returns and prices considerably more affordable than on the mainland.
The city’s most popular suburbs, which include Claremont, Glenorchy, Howrah, Kingston and Moonah, have median prices under $400,000.
The Epping region, on the northern fringe of Melbourne, is due a number of improvements which are likely to bring new people to the suburb and boost property prices, Hotspotting said.
These include the upgrade of the Western Ring Road, further expansion of commuter train services in the region and the relocation of Melbourne’s fruit and vegetable markets to Epping. There is also a new business park in development at Mickleham, which will create 20,000 jobs.
CITY OF CASEY, VIC
The property market in the City of Casey, in Melbourne’s southeast, has been growing, with many suburbs attracting rising sales activity.
The area’s rising population demands new housing estates and the State Government’s long-term planning document — Plan Melbourne — has identified several suburbs in the Local Government Area to play a major role in service delivery and creating employment.
An upturn in commercial development activity began in 2015 with five major projects creating 3,730 new jobs. The planned Berwick Health, Innovation and Education Precinct is expected to provide an additional 9,000 new jobs.
THE REST OF THE TOP 10:
Moreton Bay, Qld: The region offers affordable housing as well as good rail and road links to Brisbane and the Sunshine Coast, making it a strategically placed property market.
Sunshine Coast, Qld: Billions of dollars in service upgrades, including the development of a $5 billion medical hub, are driving an influx of new jobs to the area, in the process, boosting demand for housing.
Sunshine precinct, Vic: Sunshine and surrounds are destined to become a major regional hub within the Melbourne metropolitan area. Extensive investment in infrastructure and amenities will drive demand for property and pull up prices.
Wagga Wagga, NSW: The high number of first-home buyers taking advantage of affordable properties in the area bodes well for Wagga Wagga’s capital growth prospects, the Hotspotting report said. Army and air force bases are expanding in the area, while education, health and other community services are being upgraded.
Ipswich, Qld: A report by the Department of Infrastructure and Transport forecast 56,000 jobs will be created in Ipswich’s central suburbs by 2026. The jobs growth, coupled with affordable prices, will fuel demand for housing, Hotspotting said.
Originally Published On: http://www.heraldsun.com.au/
Queensland is the next property hotspot, experts say
As New South Wales and Victoria continue to experience weakness. Queensland is expected to take the lead, a National Australia Bank (NAB) poll of property professionals revealed.
According to the survey, industry experts project house prices in Queensland to increase by 0.7% next year and 1.3% in two years.
Some areas seen to perform strongly over the next year include Brisbane, Cairns, the Gold Coast, and the Sunshine Coast. Out of the suburbs, Coomera and New Farm are expected to realize robust gains.
Meanwhile, Queensland’s rental market is also poised to enjoy an upward boost, growing by 1.3% next year and 1.9% in two years. This is despite the stricter rules on housing investment.
The respondents of the survey also expect Queensland to retain foreign buyer interest. In fact, the share of foreign sales hit a four-year high of 22.8% over the previous quarter.
The results of the survey go against NAB’s own projection of the market. For instance, the bank expects house prices to remain flat in Brisbane over the next three years. Unit prices, on the other hand, is seen to fall by 4.5% over the next year.
NAB chief economist Alan Oster said Brisbane’s housing market seemed to be going sideways and its unit market still creates concern.
“It hasn’t peaked yet, so that’s good. We’re seeing quite strong economic activity in Queensland, so that always helps,” Oster said, as quoted by The Courier-Mail.
Gold Coast house values record the biggest growth in Queensland
The Gold Coast has recorded the strongest growth in house prices in Queensland over the past 12 months.
GOLD Coast house prices are leading the way in Queensland, up six per cent in the past 12 months to an average $620,000.
The latest figures by the Real Estate Institute of Queensland show homes on the Glitter Strip are $35,000 more on the same time last year.
Unit prices are up 1.9 per cent to $428,000.
REIQ data reveals houses on the Glitter Strip are worth $35,000 on the same time last year.
REIQ’s Queensland Market Monitor for March said the strong population growth came on the back of infrastructure projects such as the $550 million Gold Coast Health and Knowledge Precinct and M1 upgrades.
“The property market has been one of the big winners from the sporting event as the $1.5 billion infrastructure investment has boosted confidence and demand for housing in the region,” the report stated.
“We expect house prices will show an upward path in 2018. However, this growth will most likely be more moderate.”
A quiet real estate period leading up to, and during, the Commonwealth Games likely contributed to a slight drop (-0.3 per cent) in the March quarterly median sales price, the report reveals.
Andrew Henderson says a growing population and employment opportunities were contributing to a strong property market. Picture: Jerad Williams
REIQ Gold Coast zone chairman Andrew Henderson said he expected interstate migration to continue to benefit the city.
“I expect the market to remain strong,” he said.
“There is a heavy amount of interstate buyers moving here.
“I was at an auction recently where the winning bidder was from Sydney and the underbidder was from Melbourne.”
Mr Henderson said growing employment opportunities were also attracting homebuyers to the city.
The Gold Coast property market is expected to remain strong.
“We have some of the best health facilities in the country and our universities are world recognised.
“Those two things alone complement the tourism industry and the lifestyle aspects that the Coast offers.”
The report found the fastest-selling suburbs on the Coast included Worongary, Merrimac, Highland Park, Mudgeeraba and Carrara.
It also revealed the rental vacancy held tight throughout the first quarter of the year at 1.1 per cent.
Andrew Bell says the Coast had evolved from a tourist town into a vibrant city with an expanding economy. Picture Mike Batterham
Ray White Surfers Paradise Group CEO Andrew Bell said the Games heralded the next chapter for the Coast, as it evolved from a tourist town into a vibrant city with an expanding economy.
“The city’s property market is riding the irreversible momentum that has now come to the Gold Coast in terms of economic diversity and with more employment options we will need more housing options for people,” Mr Bell said.
“We are no longer going to be subject to tourism upsides and downsides as we were in the past because our economy has well and truly diversified beyond just tourism.”
Australia’s golden triangle of opportunity
It was great to be back on the Gold Coast for the 21st annual Australasian Real Estate Conference (AREC), attended by over 4,000 of Australia’s best industry professionals. While I was there I was once again reminded of how much potential the South-East Queensland property market is offering both sea changers and investors at this stage in its market cycle.
In my view, Brisbane is the best market in Australia currently for short to medium term price growth, with the value gap between it and the other big East Coast capitals as large as I’ve seen it in many years.
When you factor in the key drivers for future growth – liveability, affordability, scale and future economic prospects, they all suggest that Brisbane is a market to invest in. Check out the latest statistics from CoreLogic below.
Value gap – median house prices
Value gap – median apartment prices
I’ve been bullish on Brisbane for many years and in hindsight, I called its next growth phase a couple of years too early. It’s had some growth in recent years but there is a lot more to come over the next few years.
According to McGrath’s top prestige agent in Brisbane, Alex Jordan, one of the dominant trends today is downsizers buying up luxury apartments.
Alex says: “Despite the reported oversupply in Brisbane’s inner city apartment market, we are seeing great strength in the prestige apartment sector.
“The luxury apartment market ($1M+) is driven by owner occupiers, particularly baby boomers and empty nesters, who are attracted to less maintenance and better accessibility.
“Popular suburbs include New Farm, Newstead, Teneriffe, Kangaroo Point, South Brisbane, St Lucia, Paddington and the Brisbane CBD. These areas offer a desirable lifestyle with an abundance of shopping, dining and entertaining precincts at their doorstep.”
South East Queensland has so many options for asset-rich, cash-poor southerners. Many of our customers in Sydney and Melbourne are looking closely at South East Queensland both for investment and a potential sea change. I believe its affordability will continue to attract record levels of interstate migration.
If you live in Sydney or Melbourne and you’re struggling with the mortgage and cost of living, Brisbane is a fantastic alternative. It offers big city job opportunities, high quality education options and the chance to transform your financial future.
The boom delivered Sydney and Melbourne home owners a capital gain of up to 75% – that’s enormous new equity that could be cashed in to fund an amazing new lifestyle with far less mortgage stress up north. Plus, you’d be buying in just before Brisbane’s next wave of price growth. It’s the perfect scenario.
I believe the area from the Gold Coast to Toowoomba and up to the Sunshine Coast is Australia’s golden triangle right now.
Toowoomba, with its expanded airport facilities which have opened up easy access to the south, is the perfect and affordable treechange destination. Known as Queensland’s Garden City, about 2,300 people moved here from Brisbane last year for its cheaper house prices and enjoyable regional city lifestyle.
Both the Gold Coast and Sunshine Coast are also appealing sea change options benefitting from a raft of new infrastructure that will drive further population growth and generate more local jobs.
Brisbane is one of the world’s great cities but I don’t think this is fully realised as yet. If you haven’t been to Brisbane for a number of years, get on a plane. This is a thriving city that offers many of the lifestyle amenities you love about the southern capitals but at a much cheaper price.
I think Brisbane will also become very attractive to migration and investment from Asia in the years ahead.
South East Queensland is offering opportunity everywhere for both owner occupiers and investors alike. Now’s the time to consider what Australia’s premier lifestyle market can do for you!
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