Buyer demand for Brisbane property, imparticularly houses have returned to levels pre-crisis over recent weeks with dozens of people at some open homes.
Negotiations for strategically placed properties are much tougher than they were with more buyers competing for a low volume of listings.
During coronavirus, we remained active in middle-ring locations that offer houses around the $400,000 to $500,000 mark, and mostly had the pick of the crop.
Now, listings are still constrained, but the number of active buyers has surged two- to three-fold compared to March and April.
In fact, we have have seen up to 30 groups going through just one open home because of the lack of stock with first home buyers and owner occupiers the most common buyer type.
This state of play is reflected in the latest data and analysis by the Real Estate Institute of Queensland (REIQ).
The REIQ’s Queensland Market Monitor (QMM), released on Friday, found that the Sunshine State property market was in fine shape during the first three months of the year.
According to the QMM, Brisbane’s median house price increased 0.7 per cent over the March quarter and had strengthened by 1.5 per cent over the year ending March as well.
Greater Brisbane’s market – including the Logan, Moreton Bay, Ipswich, and Redlands regions – was also performing well, posting median house price growth of one per cent over the year as well.
Temporary pause
Local experts interviewed for the analysis say the Brisbane property market, as well as all other major markets, took a breather in April as peak virus uncertainty hit the State.
However, by May, green shoots of confidence and improved consumer sentiment had started to appear.
This market resurgence continued into June, which is what we are currently witnessing on the ground in Brisbane.
It seems that owner occupiers and first home buyers with the means to purchase are attempting to do so.
First-time buyers in particular are active in those suburbs that still have affordable investment-grade housing.
A few months ago, when asked by the media how the Brisbane property market was faring, I said properties were achieving their listing prices but there wasn’t the fight from buyers to push prices much higher.
Fast forward a few months, though, and that situation has started to change, mostly because of the continued reduced stock levels.
CoreLogic’s Home Value Index found that median house values in Brisbane stayed stable in June and had increased by 1.9 per cent since the start of the year – a result superior to Melbourne over the same period.
But I wouldn’t say it’s a seller’s markets by any stretch.
That’s because, while there are definitely more buyers out there, most of them don’t seem to have any sense of urgency.
Mostly, this is because they believe there will be a significant property price slump come September when the JobKeeper payments are wound back as well as mortgage repayment pauses.
Long-term focus
Personally, and professionally, I don’t believe the Brisbane property market will experience any major impact from the ending of these initiatives.
Lenders will not want a flood of mortgagee sales for starters, so will work with customers experiencing financial distress to prevent such a thing happening by extending repayment holidays or reductions.
That said, it is almost a moot point, because savvy property buyers and investors always purchase when conditions are right for them, including when there are market opportunities.
They also understand that to create property wealth, they need to hold their investment properties for the long-term, so it is irrelevant to them what may or may not happen in September.
With interest rates so low, and with a reduced volume of buyers compared to the average currently in the market, there has never been a better time to secure a holding in Brisbane in my opinion.
Not only does the Sunshine State capital offer affordable house prices, rental yields are usually much higher than in southern states.
Plus, I’m picking that interstate migration into Queensland will start to soar once borders are reopened as more people opt to work from home from one of the most beautiful places in the world.
