How Brisbane became Australia's new property darling

author-avatar By on September 23, 2021
How Brisbane became Australia's new property darling

ANALYSIS: 'The Brown Snake', 'Brisvegas' - for years locals jovially mocked Brisbane's 'backwardness' compared to the haute Sydney and Melbourne.

But spicy cough lockdowns have dragged on - Melbourne has 220-plus days' collective lockdown under its belt, and Sydney is now not far behind.

Brisbane is now looking like the hottest destination for southerners, suitcases or mobile phones in hand, ready to buy or bid in-person or virtually, and looking to get outta Dodge.

A new survey indicates 44% of property investors are looking to buy outside the state in which they live - up from 41% a year ago.

More than half now believe Queensland offers the 'best' investment potential - up from 36% last year.

Brisbane under the hammer

Anecdotally, having attended upwards of 50 auctions in the past couple of months - virtually and in-person - a growing number of winning bids have been via phone, and a growing number of attendees are from either Sydney or Melbourne.

Don't ask me why I've been to 50 auctions.

On a balmy afternoon in August, a couple next to me at an auction muttered among themselves, "I think that bloke [the auctioneer] has been on The Block" - he had.

It was for a rather dilapidated house in the (at-present) dilapidated suburb of Moorooka, about 10 kilometres south of the CBD - ripe for the picking.

In Sydney, 10km out puts you at about Burwood or Concord - well developed hives of their own - but Moorooka is still rather untouched apart from miles of car yards. 

The hammer soon fell for $1.25 million, the property favoured for its large 810 sq m block and development potential.

The naive couple gasped - they ain't seen nothin' yet.

SQM Research data below shows an uptick in homes scheduled for auction in the River City, minus the Christmas lull and COVID lockdown v1.0 hitting in April 2020. 

A reminder - this is just scheduled auctions, not accounting for homes sold prior or those that have passed-in. 

No matter how you swing a cat, Brisbane used to be like other second-tier Australian capitals where it was relatively uncommon to find a home selling under auction, but now the true Olympic City™ is becoming like its bigger brothers down south.

See Also: What the 2032 Olympics could mean for Brisbane property

The great migration

The latest ABS data shows capital cities had a net loss of 11,800 people in just a quarter - the largest quarterly net loss on record.

Brisbane gained the most (+3,300 net), while Melbourne lost the most (-8,300), followed by Sydney (-8,200).

In the previous quarter, Brisbane also had a +4,800 net migration.

Annually to 31 March 2021, Queensland gained 43,900 people, while NSW increased a more modest 11,700 - before extended lockdowns hit the state in June.

Victoria lost a massive 42,900 in the same period.

"Repetitive lockdowns have already been the catalyst for thousands of CBD and inner-city businesses permanently closing their doors," Propertyology's Simon Pressley said in August.

"Others are embracing the flexibility of work-from-home, and there's a lot less appeal now for living in confined spaces."

COVID, however, coalesced with a wider trend - people were moving away from Sydney and Melbourne even before the pandemic (chart below).

Many people have also gone to the regions as working from home becomes the 'new normal', and Brisbane is buttressed by two idyllic locations - the Gold and Sunshine Coasts.

Coastal spillover

When talking about Brisbane, it's impossible to ignore the Sunshine Coast (north), and the Gold Coast (south), as they together form one giant metroplex known as South East Queensland.

Recent Domain data shows Surfers Paradise was the number one suburb in Australia for property turnover, with Southport, Broadbeach, Maroochydore, and Buderim also making the top 20.

According to recent PRD research, over the past five years the Gold Coast in particular has recorded double digit median price growth for both units and houses.

'Middle ring'* houses had the strongest growth, up 32.5%.

Despite the strong growth on the Gold Coast, PRD chief economist Dr Diaswati Mardiasmo said the area represents some of the best 'major city' opportunities for first home buyers.

"I find it fascinating that the Gold Coast is the only major city house market - compared with Sydney, Brisbane, Melbourne, Perth, Hobart, and Canberra - that has equal opportunities, in both inner and middle rings, in the most affordable price brackets," Dr Mardiasmo told Savings.com.au.

"It looks like Gold Coast first home buyers could be the luckiest among other first home buyers across the country, at capital city level." 

For the middle ring, 30.7% of homes fell under the $699,999 price bracket - for the inner ring, that's 28.8%.

The 2021 median sale price for inner-ring suburbs was $825,000, while for middle-ring suburbs it was $888,000 - the first time the middle ring has outpaced the inner ring in five years.

"With more people choosing to not be right in the heart of Gold Coast CBD - working from home, requiring more space or a backyard - demand moves from inner to middle," Dr Mardiasmo said.

"Also middle-ring Gold Coast is not too far away from Logan and South of Brisbane - you get spillover demand from those working in either of those LGAs."

A trend or ongoing phenomenon?

Despite all the talk of regional moves and people fleeing Sydney and Melbourne, Managing Director of EG Advisory, Dr Shane Geha, says the country still has a ways to go before it fleshes out true regional hubs.

Dr Geha said the regional push is 'transient' and people will soon return to the big cities.

"Regional migration will be short-lived - there is a reason why Australia's population is so heavily based around the major cities," he said.

"There needs to be further investment in regional areas if they are to become genuine hubs of activity and business - a place people choose to live long-term.

"The major employment opportunities and amenities remain within Australia's major cities and will continue to be a major drawcard.

"Concern regarding overpopulation within our major cities is hyperbolic - regional hubs will only really thrive and grow once Sydney and Melbourne almost double in population."

Little old Brisbane still keeps battling - offering most of what you can get in Sydney and Melbourne without the sacrifice of other regional areas, while currently having cheap-er housing than 'the big two'.

But if you ask me, South East Queensland is terrible - don't move here. People walk slowly on the footpaths with their mouths open, slow drivers hog the right lane, it's too hot for six months of the year... the Lions keep choking, the Broncos suck, and the Heat are uninspiring. 


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Photo by Teer XC on Unsplash

*PRD lists middle ring suburbs as: Broadbeach, Broadbeach Waters, Carrara, Clear Island Waters, Coombabah, Gaven, Helensvale, Highland Park, Hollywell, Hope Island, Mermaid Beach, Mermaid Waters, Merrimac, Nerang, Pacific Pines, Paradise Point, Robina, Worongary.

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The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

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Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.

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