BRISBANE DEFIES FALLING HOUSE PRICE TRENDS
BRISBANE Local Government Area (LGA) clung to median house price growth of just 1.1 per cent to close out 2018 in positive territory, defying, for now, the national trend of falling house prices, according to the latest REIQ Queensland Market Monitor, reporting on the December 2018 quarter.
REIQ CEO Antonia Mercorella said the Queensland property market was facing a perfect storm of conditions that were potentially putting the sector in harm’s way.
FOR MORE REGIONAL MARKETS DOWNLOAD THE QMM
“A positive growth rate of 1.1 per cent for this market means Brisbane is really performing the best out of the three largest capital city property markets. Sydney and Melbourne are facing significant falls in their house price, but so far we are holding on for dear life to a positive growth figure.
“However, it’s important to recognise investors are jittery and the market is slowing, and it’s easy to see why. A federal election is looming and negative gearing is the sacrificial lamb, combine this with a State Government review of the tenancy legislation and the likelihood that landlords will lose some rights, and investors are understandably questioning the value of property as a wealth-building tool.
“Add into the mix tightened lending criteria as banks move to restore consumer confidence that has been savaged following the Royal Commission, and our property market is currently in the shadow of some large, gathering storm clouds,” Ms Mercorella said.
“The Queensland property market has all the right ingredients to withstand these headwinds and success really comes down to consumer confidence.
“We have relatively low unemployment, high interstate migration rates, low rental vacancy rates and major, long-term infrastructure projects delivering jobs and improved liveability in the southeast corner. Restoring consumer confidence and giving buyers access to finance would benefit the market – and the broader Queensland economy – significantly,” Ms Mercorella said.
Outside of the Brisbane local government area, results were a mixed bag.
Traditionally a powerhouse market, the Gold Coast succumbed to pressure and delivered annual median house price growth of just 1.4 per cent to $625,000. And while the Gold Coast is the state’s largest unit market, traditionally settling more than 10,000 sales a year, in 2018 this market eased, with the annual median unit price contracting 1.2 per cent to $430,000 in about 9,000 sales.
Noosa held onto its crown as the turbo-charged house market, delivering an astonishing 11.7 per cent annual median house price growth, to a new high of $739,500. It also remains the most expensive house market in Queensland. But it had a grim December quarter, losing 8.2 per cent, so all eyes are on this market to see how the next few quarters fare.
In regional Queensland Mackay continued its full-tilt charge towards recovery, with 3.9 per cent annual median house price growth, to land on an annual median house price of $343,000. While this market is still below the five-year waterline, it is on a steep trajectory towards a new high.
Rockhampton failed to deliver on the promise made by its ever-tightening rental market. Typically these rental figures indicate a boost to the sales market is coming, however, that has yet to materialise as the Rockhampton market eased 1.9 per cent for the year.
In Townsville, the year closed out softly, with 3.0 per cent reduction in the annual median house price to $320,000. The next quarter, Q1 of 2019 calendar year, will include monitoring throughout the flood period. At this stage it’s still challenging to discern how the market is faring as the city continues to mop up.
Cairns held ground, easing just 1.2 per cent, to an annual median house price of $405,000. This market is looking at a rosy future as population forecasts and tourism sector predictions all outline a robust 2019.