Kangaroo Point May Be Among First to Benefit from Optimistic 2019 Unit Market Outlook in Brisbane

Photo Credit: Tamara1503 [CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0) / Wikimedia Commons

More than half of Brisbane apartment units sold off-the-plan, over fifty percent of new apartments sold starting mid-2017, now have a valuation that is lower than what their buyers paid for, CoreLogic’s Settlement Risk report revealed.

However, experts say that the apartment market may have already bottomed out. Experts are optimistic that the worst is already over for the Brisbane unit market and areas in the 5-km inner-ring around the CBD, such as Kangaroo Point, may be the first to turn.

This same optimism is shared by researchers at Place Projects. According to Place Projects’Apartment Magazine summer edition report, current supply of new apartment is steadily tightening, declining to about 10 percent in September quarter 2018. Should the trend remain, available apartment supply will be absorbed by the end of 2019, the report said.

From its peak in 2015, the Brisbane market sales volume overall has since experienced a decline, albeit minimal sales volume decrease in the housing market. It is the unit market, however, that experienced a significant weakening in sales volume.

Sales volumes during the September quarter 2018 are still comparatively lower than previous long-term levels. Latest data, however, indicate rising buyers interest in the Brisbane unit market as sales volume has doubled compared to the previous quarter. The September quarter also saw the weighted average apartment sale price reach a new record high of $740,489, up by over $100,000 or 17 percent.

Kangaroo Point | Queensland 4169, Australia

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Although the Brisbane unit market suffered due to oversupply in 2018, the coming months will see a decreasing supply as 60 percent of future projects are either currently deferred or abandoned. This trend will likely continue on with every quarter. Also, new applications now only account for eight percent of the future apartment market pipeline and the remaining 32 percent represents those applications that have been approved.

On the other hand, industry experts say that inner-city urban areas such as Kangaroo Point, are benefiting from strong owner-occupier demand, especially from the “downsizers” segment of the market.

Of the 342 units available for sale in Kangaroo Point, only 39 remain as of end of Q3 2018, Apartment Magazine summer edition report said. Apartments are the most sought-after properties in Kangaroo Point, according to Domain, with a median price going up to $534,000 in 2018 from $525,000 in 2017.

Overall, Brisbane market is primed for future growth. Queensland, in fact, is becoming Australia’s top destination for interstate migration primarily due to its housing affordability. Brisbane is 90 percent cheaper than Sydney and 43 percent cheaper than Melbourne. Coupled with Brisbane’s infrastructure commitments, liveability, and job opportunities, demand has increased, notably for high quality apartments.