The property market is one of the most trend-based phenomena of our time and every now and then, a trend arises that makes a huge impact. Right now, there’s one trend that are huge portion of Australian investors are following and there’s some really strong logic behind it.
There are more Sydney based investors investing in South-East Queensland property than ever before. According to CoreLogic, the June median sale price for property in Sydney was $1,000,500 – tipping the million mark.
When you consider the characteristics of good investment properties; great infrastructure, location close to amenities and public services, green space, transport and accessibility and so on, buying property in Sydney for the sake of investing suddenly becomes unrealistic. Especially when coupled with the now sky-high interest rate on investment loans.
So naturally, they’ve looked elsewhere and South-East Queensland is an absolute hot spot. In the same CoreLogic data mentioned earlier, it was reported that the median sale price for Brisbane was $513,000 – almost half of that in Sydney. South East Queensland makes a brilliant hot spot for investors, and not just for affordability.
Economists predict that rental yields will only strengthen in South East Queensland over the coming years and for good reason. Two of the region’s major satellite cities sitting on the South and North sides of Brisbane, Ormeau-Oxenford and North Lakes, are in Australia’s top ten fastest growing regions with population growth of 28.5% and 38% over the last five years respectively. This shows that the population growth will drive demand for housing and will create abundant yields.
Of particular interest is that Brisbane, unlike Sydney and Melbourne, hasn’t adapted to high density living so well and there is still a very strong demand for rental houses on regular parcels of land. Right now on RealEstate.com.au a search across the Brisbane rental market shows that houses and townhouses account for about 45% of properties available whereas in Sydney they account for around 10%, making way for an abundance of apartments and units. Houses are usually larger with more residents per dwellings than apartments and units again supporting healthy yields.
This is a trend that the experts are gently supporting. Just this week the latest Hotspotting Top Ten Best Buys for 2017 report was released, naming three South East Queensland regions in the top four. Report author, Terry Ryder, identified Moreton Bay Region, the Sunshine Coast and Redcliffe in the top four – all locations inside the Golden Triangle.
Speaking to the Courier Mail, Mr Ryder shared why he believes the region is such a strong investment performer.
“I think it’s an evolution of the market from the situation that predominated for the last few years when we were talking all about Sydney and then Melbourne. Sydney is very much past its peak and is winding down, Melbourne is still producing good figures but it’s past its peak as well, I think,’’ he said.
“There is lots of evidence of people looking toward Brisbane and South East Queensland for affordable alternatives and better rental yields. I think that’s where people are expecting is where they are going to find the growth moving forward.”
Backed by the experts, it’s evidenced in our last few months of business. E-Fishient Property Solutions Managing Director, Ryan Fisher, said that the last three months has seen a significant spike in Sydney based enquiries. “About one in three enquiries have been from Sydney based investors between early May and now, showing just how active investors from the region are at the moment. This is very high compared to earlier in the year which would probably have been more like 1 in ten enquiries.” He said.
Along with the strong capital growth predictions and abundant yields, Ryan believes there is another major motivator for investors looking interstate – the fact that it is an investment.
“The best thing about technology for investors is that you no longer have to invest in your own back yard and self-manage. Communication is so good that you can trust a property manager or investment manager to take care of the property for you. It’s no longer a proximity thing.” He said.
If you’re trying to map out an investment plan over the next couple of years – you might want to look over the border and into Queensland, because it looks like it’s going to be a rewarding investment venture for many.