Kelvin Grove Unit Market Property Watch Q2 2012
Underlying demand continues to underpin the performance of the Kelvin Grove unit market, with buyers quick to absorb new stock entering the market. This is demonstrated in the sales cycle chart by the fluctuations in sales activity over the past 10 years, with the peaks generally coinciding with new injections of stock in the market and vice-versa. Located within 2kms of the Brisbane CBD, the availability of land and/or suitable sites for densification is scarce. However, with the inception of the Kelvin Grove Urban Village precinct and the associated planning mechanisms that have facilitated high density development in the area, supply over the past five years has improved dramatically, with developers benefiting from strong take up rates.
The median price recorded in the six months to February 2012 was $485,000, representing a solid 15.5 per cent increase from the corresponding period in 2011. The five year average annual growth rate was a notable 6.7 per cent, which is rather impressive considering softened capital values and the markets general underperformance subsequent to the Global Financial Crisis. The recent performance of the market is a testament to the desirability of the suburb, from both a liveability and investment perspective. Strong rental growth (8.5 per cent average annual growth over the past three years to March 2012 quarter for 2 bedroom units, and 5.8 per cent average annual growth over the same period for 1 bedroom units) demonstrates both the growing demand for accommodation within the suburb and attractive investment yields for investors.
It is anticipated that activity will be sustained at this level throughout 2012, as reductions to interest rates and a change in government contribute to improved confidence in the market. The reinstatement of transfer duty concessions by the State Government on the 1st of July 2012, may contribute to increased sales volumes in the successive half year period. This is however unlikely to provide stimulation in the market, rather accommodate to those would-be buyers who have been prolonging their purchase until such time the concession is reinstated.
The median price recorded in the six months to February 2012 was $485,000, representing a solid 15.5 per cent increase from the corresponding period in 2011. The five year average annual growth rate was a notable 6.7 per cent, which is rather impressive considering softened capital values and the markets general underperformance subsequent to the Global Financial Crisis. The recent performance of the market is a testament to the desirability of the suburb, from both a liveability and investment perspective. Strong rental growth (8.5 per cent average annual growth over the past three years to March 2012 quarter for 2 bedroom units, and 5.8 per cent average annual growth over the same period for 1 bedroom units) demonstrates both the growing demand for accommodation within the suburb and attractive investment yields for investors.
It is anticipated that activity will be sustained at this level throughout 2012, as reductions to interest rates and a change in government contribute to improved confidence in the market. The reinstatement of transfer duty concessions by the State Government on the 1st of July 2012, may contribute to increased sales volumes in the successive half year period. This is however unlikely to provide stimulation in the market, rather accommodate to those would-be buyers who have been prolonging their purchase until such time the concession is reinstated.