What’s Next For South East Queensland Property in 2021
Phew, we made it through 2020.
What’s in store for South East Queensland’s residential property markets 2021?
Firstly new and established apartment markets will struggle in the near term, especially in Brisbane CBD. I’m not a big fan of large developments anyway, but in the current conditions, I would not recommend anyone enter this market unless you are fully aware of all the risks involved.
We will have a healthy few years of price growth and strong rental returns for detached dwellings, of course, the caveat to that is Covid19 vaccines roll out the way we hope. The world can then get back to some normalcy, economically and politically.
According to Core Logic, Brisbane houses rose a respectable 4.5%, with Regional Queensland 5.9% for 2020, but the exciting figure for me was the more than half of that rise in the last quarter of 2020. This trend looks set to continue in 2021 helped by record-low interest rates, plans to loosen lending restrictions and more significant competition from investors re-entering the market due to rising yields and asset class stability.
What to the forecasters say about SE QLD in 2021?
Louis Christopher of SQM Research is predicting between 4%-8% for 2021
Shane Oliver of AMP is predicting up to 10% growth in 2021.
Bill Evans and Matthew Hassan of Westpac expect a surge of20% up to mid-2023.
ANZ Bank Economists are predicting 9% growth in 2021.
Terry Ryder of Hotspotting says “Queensland is experiencing the most robust market in 6 years”. In the latest Price Predictor report, Brisbane has 56 Suburbs with rising sales and regionally “The Sunshine Coast is again the standout location” 21 suburbs with increasing and consistent sales volumes.
Both rental and for-sale housing stock levels are currently very low for both Brisbane and The Sunshine Coast as they were for most of 2020. I see this continuing into 2021 with many vendors not coming to market unless they have a reason to sell, e.g. financial hardship or merely upsizing/downsizing. Days on the market are shortening across most suburbs we are buying in.
The sub $600k market is scorching at the moment with many properties selling in a few days. We will see rental increases upwards of 5% over the year based on the current record-low vacancy rates.
We expect to see greater increases for properties where the lease began during the Covid lockdowns peak, Feb to June 2020 as during this period landlords were happy to secure in a tenant for 12 months at a lower rate. These new leases will make the numbers look a little wild over the next few months but it should even out as the year progresses.
Are you thinking of entering the property market in 2021?
Do your due diligence as all investment decisions have risk involved. Whatever you do, don’t make a decision based on slick marketing material.
Do your research, put together a plan with an end goal and what you need to achieve to meet that goal.
Start moving forward, whether it’s beginning a savings plan, or researching the government assistance available in the state you are looking to purchase.
If you require professional assistance, make sure you know how they earn their income and are appropriately qualified/licenced and insured in Queensland. Beware of FREE services as there’s no such thing as a free lunch.
The future looks bright, happy 2021.
If you would like to arrange a time for an obligation free discussion about your property buying requirements in Brisbane or The Sunshine Coast you can access my calendar by clicking HERE