Brisbane - Affordable & Liveable Property Guide 1st Half 2018
Affordable Suburbs - Brisbane
Between 2016 to the 1st quarter of 2018*, the number of houses sold in the Brisbane City Local Government Area (LGA) grew by 17.9%. The median price also grew by 3.1%, indicating real capital growth and healthy demand. Units however, have become increasingly affordable as prices have softened by -3.1%. The majority (61.3%) of suburbs in greater Brisbane experienced single digit price growth, 14.9% experienced double digit growth and 23.8% had negative growth. Property buyers will be ecstatic to learn about these affordable options amid continued price growth across suburbs in the north and south. At the same time, rental prices in the LGA have remained stable for both houses and units.
Table 1. Brisbane’s top performing suburbs in the 1st half of 2018
Queensland’s housing affordability has declined^. The proportion of income to meet home loan repayments has increased by 27.6% over the past 12 months (to the December 2017 quarter). Although the number of first home buyers increased by 13.4%, this is much lower than New South Wales (74.9%) and Victoria (39.7%). Table 2 provides the percentage of suburbs in Brisbane that are available for house buyers.
Liveable Suburbs - Brisbane
2018 sees liveability added as a new criterion included in our methodology. This ensures that not only does our report highlight affordable suburbs but also those that have high liveability factors. This provides us with insight to the ‘cost of liveability’ and how much home buyers need to be prepared to pay. It also serves as a warning to local and state governments on the rising costs of liveability. It also provides focus areas for further development to create a balanced opportunity for residents, regardless of their income bracket.
Suburbs with a maximum property sale price of the average state loan, plus a 40% deposit have been highlighted as ‘affordable’ for purchase. In the greater Brisbane area there are 4 suburbs that fall within this category: Ellen Grove, Inala, Acacia Ridge and Darra. Despite having met the housing ‘affordability’ benchmark, these suburbs fail to meet key liveability factors. To meet the minimum benchmark of ‘liveability’, a 60% premium is added to the average state loan. Interestingly only 30% was needed to be added to find affordable and liveable unit hotspots, making the combined average cost of liveability in the Brisbane LGA only 5%, the lowest amongst all capital cities!
Affordable & Liveable Suburbs - Brisbane
Considering a combination of key property criteria such as: property trends, investment potential, affordability, project development and liveability factors; the tables below show the suburbs that should be on every property watchers list.
Table 3. Affordable and liveable suburbs - Houses
Table 4. Affordable and liveable suburbs - Units
Over the 2017 December quarter, the Brisbane rental market recorded a median rental price of $380 for both houses and units, representing stable growth. The vacancy rate peaked high in December 2017 and has been on a decreasing trend in comparison to December 2016, suggesting the Brisbane market is slowly absorbing the oversupply of residential accommodation. Moreover, the rental yield in Brisbane Metro is at 3.7% (houses) and 5.0% (units), which is well above Sydney Metro’s 2.9% (houses) and 3.8% (units), and Melbourne Metro’s 2.8% (houses) and 3.8% (units). This is exciting news for investors who are looking to purchase property in Brisbane as it’s still highly affordable and offers a higher yield.
The 1st half of 2018 is set to see approximately $3.8B worth of developments, with a well-balanced focus on infrastructure, residential and commercial projects. The Herston Quarter Rehabilitation and Ambulatory Care Centre ($347.0M) is the main commercial project. Brisbane Quarter the One Residential Tower ($300.0M) is set to deliver 466 units in an 81-storey tower in the Brisbane CBD. The main infrastructure project is Logan Enhancement Project ($512.0M), which will improve key congestion hotspots.
This guide analyses all suburbs within the greater Brisbane area. The suburbs chosen as the most affordable and liveable hotspots are within a 20km radius of the CBD. In selecting hotspots, the below factors and methodology were considered:
- Property trends - suburbs will have a minimum of 20
transactions for statistical reliability purposes, with positive price growth
over the past 15 months (2016 to Q1 2018*).
- Investment -
suburbs will have on-par or higher rental yield than Brisbane Metro, as well as
on-par or lower vacancy rates (as of December 2017).
- Affordability and
liveability - suburbs will have a median price below the maximum
affordable property sale price, based on the average state loan. In this report
60% for houses and 30% for units were added to the average Queensland home
loan, which was $338,822 as at December 2017^^. Key liveability factors included ensuring
the suburbs have a low crime rate, availability of amenities were within a 5km
radius (i.e. schools, parks, shopping centres, and health care facilities), and
an unemployment rate that is on par or lower in comparison to the state average
(as determined by the ABS Census 2016).
- Project development - suburbs will have a high total estimated value of future project development for the 1st half of 2018**. This ensures sustainable economic growth, having a positive effect on to the property market.