Brisbane Hotspots 2011

The purpose of this Hotspot report is to identifies suburbs of Brisbane that have the potential to perform over the coming year. Suburbs have been chosen based on current pricing levels, infrastructure, property trends, access to amenity and other factors. In addition, our hotspot picks from the past year were analysed to see how they performed.

Performance of 2010 hot spot picks
Our ten hotspots from twelve months ago are shown to the right, together with how they performed over the past year. A total of 57 suburbs in the Brisbane LGA made over 10% growth in the median house price during the year, showing a price correction in the marketplace after the skewed median price in 2009 (mainly due to increased activity in 2009 from first home buyers). Over the 12 month period ending September 2010 the average growth in median price for houses in Brisbane was 5.5%, while units achieved 6.7%. The hotspot picks by PRD Research for 2010 achieved a higher average growth of 10% for houses and 9.9% for units. The suburbs that experienced median house growth above 10% were fairly dispersed between the inner, middle and outer rings of Brisbane. A total of 35 suburbs within 10 kilometers of the CBD achieved 10% plus median price growth, while 22 suburbs located in the outer ring achieved over 10% growth.

Looking forward in 2011
Buyers in the Brisbane property market during 2010 were hard to secure, choosing to negotiate hard in what has become a buyers market. As a result of a decline in demand, the market has shifted from intense high growth in values over the short term, to focusing on longer term gains. If we look to the Sydney house market as an example, it experienced little price growth from 2004 to 2009. In Brisbane, price growth will not be so flat for so long, but the days when suburbs experienced 20% plus growth over the duration of one year will not be seen for several years.

As the focus has shifted to longer term gains, savvy buyers will look for opportunities where prices are still affordable but have potential to grow in value quicker than other Brisbane suburbs. That being said, many key developments target at improving transportation infrastructure around Brisbane are yet to be completed. As these developments are finalised in the coming years, accessibility to many suburbs will open up and in turn suburbs will experience greater levels of demand.

Hotspot picks for 2011
For this year, hotspot suburbs revolve around two key fundamentals. The first is the affordability of the suburb, allowing room to increase in value over the short to medium term. Several picks for the 2011 hotspots, are suburbs that are located in or next to highly desirable areas, at an affordable price. The second fundamental is improving accessibility to and from the suburb. With traffic congestion quickly becoming common among many Brisbane roads, suburbs that have reliable public transport or do not rely upon the main choked up, arterial roads are desirable. For this reason, several picks for 2011 are located in the middle north of Brisbane, where much of the development in transportation infrastructure has taken place. The Northern Link and Busway are expected to be open in mid-2012 and shall have a positive impact in the northern region of the city. Those suburbs lying closer to the city will experience greater demand for property firstly, then shall be rippled out to the outer lying suburbs. Investors would be wise to enter into the middle north Brisbane market before developments are completed.