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Brisbane Housing Market Insights: March 2021

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The Urban Developer’s Brisbane housing market insights for February reveals increased demand for houses has been underpinned by increasing consumer sentiment and a surge in interstate migration.

This resource, to be updated monthly, will collate and examine the economic levers pushing and pulling Brisbane’s housing market.

Combining market research, rolling indices and expert market opinion, this evolving hub will act as a pulse check for those wanting to take a closer look at the movements across the market.

So, what were the highlights across Brisbane’s property market throughout February 2021?


Brisbane, less vulnerable to financial stresses caused by the pandemic-driven economic downturn, took a smaller hit from lower immigration and is also benefiting from people moving to the city for lifestyle reasons.

Similar to other cities, growth in values has been skewed towards houses in Brisbane, which have risen 5.9 per cent compared to a 1.1 per cent lift in unit values during the 12 months to February.

According to Corelogic, dwelling values in Brisbane had an overall median monthly price rise of a 1.5 per cent during February.

The February increase is the steepest rise since November 2007 when the monthly growth rate was 1.72 per cent.

The current median value for dwellings across Brisbane is $535,618, the highest on record, while the current median unit price in Brisbane is $396,183.

In Brisbane's east, house prices have lifted by nearly 10 per cent during the past 12 months.


Brisbane median house and unit price values

TypeMonthQuarterAnnualMedian
All1.5%▲3.5%▲5.0%▲$535,681▲
Houses1.6%▲3.8%▲5.9%▲$593,232▲
Units1.0%▲1.8%▲1.1%▲$396,183▲

^Source: Corelogic Hedonic Home Value Index - February


Brisbane housing market affordability

CityHousehold income to meet mortgage repayments September 2019Household income to meet mortgage repayments September 2020
Brisbane21.0%18.7%

^Source: Moody's Investor Services - October


Brisbane prestige property ranking

CityGlobal ranking 3-month change12-month change
Brisbane23rd-1.4%▼ 1.1%▲

^Source: Knight Frank Prestige Property Index - November


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Clearance rates across Brisbane have been tracking around record highs during recent weeks.

More people are bringing their homes to a market that is snapping up more than three-quarters of dwellings offered for sale, encouraged by record low interest rates and an economy recovering from the pandemic.

Home prices across the country are expected to surge as eager buyers pushed clearance rates significantly higher in February, with almost three in four properties auctioned in Brisbane sold during the month.


Brisbane auction clearance rates

WeekClearance rateTotal Auctions
Week ending 7 February 202174.6%84
Week ending 14 February 202162.7%79
Week ending 21 February 202179.4%91
Week ending 28 February 202179.0%115

^Source: Corelogic Auction Clearance Rates - February


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Australian home values have officially increased for the first time since Covid-19 started...

Renters Seek Out South East Queensland


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Renters are paying more to live in a unit in Brisbane than in Melbourne counterparts....


Unprecedented rates of interstate and overseas migration have sparked one of Brisbane’s strongest rental markets in a decade, with the city clocking record-high median prices that, in parts, are outstripping Melbourne.

Analysis by Domain showed recently that apartment rents had started to rise in Brisbane and, for the first time in five years, it now was more expensive to rent a unit in Brisbane than in Melbourne.

Brisbane house and unit rents continued to reach record highs, with median asking rents of $425 and $400 per week respectively, the Domain data showed.

Vacancy risk continues to recover rapidly within the Brisbane CBD this month with currently vacancies now similar to the peaks between 2016 and 2018.

Vacancy rates across most of Brisbane remain tight, and in fact are tightening even further as the demand for rental properties increases.

Rents in the unit market in Brisbane have now recovered and we are seeing some upward pressure on rents with an annual change in unit rents of 0.5 per cent across the city.

Housing rents continue to see growth, due to the tightening vacancy.


Brisbane residential rental vacancy rate

CityFeb 2021 Vacancy RateMonthly % changeFeb 2021 total vacancies
Brisbane1.5%▼0.2%▼5,310▼

^Source: SQM Research - February


Rental stock on market

CityFebruary 2021 vacanciesVacancy net loss
Brisbane5310▼576▼

^Source: SQM Research - February


Brisbane rent prices

TypeRentMonthly % change Annual % change
Houses $478.00▲0.1%▲1.6%▲
Units $381.00▲0.6%▲1.2%▲

^Source: SQM Research - February


Apartment New-Builds Down 40pc


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Building approvals for apartments were down 40 per cent at the end of January...

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Queensland has continued to record its highest private house approval figures since since September 1994 bolstered by interstate migration and government stimulus measures.

Upwards of 30,000 new dwellings are expected to be built this year, almost 60 per cent more than projected in April last year before government stimulus measures such as Home Builder were introduced.

Investor lending remains relatively modest overall, at a national level, although based on our own level of inquiry, there is definitely a lot of investor interest circling Brisbane at the moment.

The latest lending figures show that owner-occupier lending has risen to historical highs, with first home buyer numbers in Queensland up 70 per cent year-on-year.

Over the September quarter, Brisbane gained the most of any other major city in terms of net internal migration, with 3,200 people moving to the sunshine state, according to recent data from the Australian Bureau of Statistics revealed.


Queensland building approvals

^Australian Bureau of Statistics - December (Suspension of trend series between May 2020 and Jul 2020 due to Covid-19)

DwellingApprovedMonthly % change
Houses2364▼ 19.0%▼
Units2921▼-33.3▼

^Source: Australian Bureau of Statistics; Reference period January (Next Release 31/03/2021)


Queensland home loan lending indicators

RegionFirst home buyer loan commitmentsFirst home buyer ratio - dwellingsFirst home buyer ratio - housing
Queensland3048▼41.4%▲36.2%▲

^Source: Australian Bureau of Statistics - January (Next Release 01/04/2021)


Queensland interstate migration

RegionSeptember (quarter) 2020 arrivalsSeptember (quarter) 2020 departuresSeptember 2020 quarter net
Queensland22,317▼15,080▼7,237▲

^Source: Australian Bureau of Statistics - September quarter 2020


Brisbane’s housing market: policy updates

The Home Builder scheme will continue until the end of March in a bid to prevent a major decline in construction activity.

Read more: HomeBuilder Gains Eleventh Hour Extension

Queensland faces a “hard road” over the next four years as the state recovers from the coronavirus pandemic, Treasurer Cameron Dick says.

Read more: Queensland Budget Announcement

The central bank, which introduced a package of measures at its latest meeting, cut the cash rate target to 0.1 per cent—the lowest in Australia’s history, in its bid to support a recovery.

Read more: RBA Cuts Interest Rate in Bid to Build Economy


Brisbane housing market forecasts

ANZ economists forecast Brisbane house prices will rise by 9.5 per cent next year, as low interest rates and government stimulus flow through the economy while Commonwealth Bank updated its forecasts, projecting a strong rebound in prices across the second half of 2021.

CBA now expects Brisbane house prices to increase by 16.6 per cent to December 2022 compared to 13.7 per cent in Sydney and 12.4 per cent in Melbourne.

Westpac has also updated its property forecasts, with Brisbane real estate prices tipped to surge 20 per cent between 2022 and 2023.


What the experts are saying about Brisbane's housing market

Eliza Owen, Head of Research, Corelogic


Eliza Owen
Head of Research
Corelogic

“In an environment where there's no international migration, that internal movement is really benefiting markets relative to other parts of the country.

“In terms of prices steadying or falling across Queensland, I wouldn't expect to see that until we get a significant uplift in the amount of stock on the market which is unlikely as people aren't really moving as much at the moment.

“Or we see the cash rate increase, and as such mortgage rates would increase, and again that's not something we would expect until the inflation target is between 2 and 3 per cent.”

simon pressley


Simon Pressley
Market Analyst
Propertyology

“We had a series of events for a couple of years before Covid that meant progressively there was less and less resale stock in Brisbane, and it was getting tighter and tighter.

“There’s no question in my mind that Brisbane will outperform Sydney and Melbourne for quite some years.

“What we are going to see throughout 2021 is an increase in properties listed for sale, but at the same time, buyers will regain more confidence.

“We’re calling it the biggest single property boom in 15 years Brisbane and we could see double-digit price growth [over the next 12 months].”

Gareth Aird


Gareth Aird
Head of Economics
Commonwealth Bank

“Brisbane is less reliant than both cities on international migration that has been impacted by border closures.

“The vacancy rate in Brisbane is around 2 per cent compared to 4 per cent in Sydney and Melbourne.

“The boom is being driven by record low mortgage rates coupled with a V-shaped recovery in the labour market.”


Sydney Aerial


Sydney Housing Market Insights
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Article originally posted at: https://theurbandeveloper.com/articles/brisbane-housing-market-update