Why are Brisbane property prices going up by so much during a pandemic?

A perfect storm of low stock, even lower interest rates, wage growth and a global pandemic have catapulted Brisbane’s typically slow-moving property market into the stratosphere, sparking a once-in-a-decade boom that experts say could fuel a further 10 per cent rise in house prices in the coming year.

While detached property prices rose in every capital city except Darwin and Perth over the January quarter, according to figures released by Domain, the almost magical mix swelling Brisbane’s usually stable market has been brewing for two years.

So, it’s a case of rising tides lifting all ships – but not everyone is rowing in the same boat.

In Brisbane we had a series of events for a couple of years before COVID that meant progressively there was less and less resale stock, and it was getting tighter and tighter. Then in the six months leading up to COVID, we had auction clearance rates through the roof, prices rising primarily because we had not enough supply for sale and not enough rental supply and then we had four interest rates cuts.

And then there was COVID...

The stars were aligning for a Brisbane property boom well before the pandemic struck, the virus further fuelled the fire as Melbourne and Sydney bore the brunt of the nation’s coronavirus chaos.

If you look at the numbers, Melbourne they lost 10,000 people (to interstate migration) in six months, and that was before the lockdown.

Many property experts predict Brisbane will outperform Sydney and Melbourne for quite some years.

They predicting that throughout 2021 there will be an increase in properties listed for sale, but at the same time, fuelling all the buyer frenzy. Some even saying it will be the biggest single property boom in 15 years Brisbane … and we could see double-digit price growth.

Brisbane has also seen some major infrastructure projects like Queens Wharf and Cross River Rail plus the recently completed Howard Smith Wharf which is making it the place to be. Especially those fleeing the lockdowns and average weather down south.

We remember the last boom before and after the GFC but the current surge has outstripped that. in the last 3 months we have built up the largest level of pre-approval loans. They just need to find a property with clients complaining that at each open there are over 20-30 groups through and over 10 official offers. The days of negotiating on a property seem to be well and truly over.

Normally December is a low lodgement month but it was a boom month for Boss Money and that trend has continued for January and into February 2021. Everyone has the fever and fear of missing out.

All very different to the doomsday messages we were hearing when COVID began.

Instead, Australian Bureau of Statistics figures released in November last year revealed Queensland enjoyed one of the nation’s highest quarterly wage growths (of 0.6 per cent) amid reports of sky-high buyer activity.

The city has since undergone two consecutive quarters of house price growth, with suburb price records smashed every other week in a remarkable show of strength.

We have been waiting for growth in Brisbane for the last 3 years as Sydney and Melbourne kept pushing the limits with their strong property price rises.

Many experts have said Brisbane was due for a rise in property prices but no one would have predicted how quickly people got their confidence back.

This would also come down to the amazing lifestyle in Brisbane (and I have lived in Vienna, Melbourne, Sydney and London) with its great weather and cheap(er) housing than the southern states. It could also be said, that we handled COVID better than other states and Australians are looking at Brisbane (plus Sunshine and Gold Coasts) has a safe haven.

Many Australians are now working from home permanently and realised that if they are going to do that, why live in a big expensive city like Sydney and Melbourne.

We have seen clients move out of Brisbane to up and down the coast and out bush as an alternative to living and working in the big smoke.

The clients we are seeing getting pre-approvals for properties down south and now more 30-40 year olds looking to move to Brisbane as its becoming a cool place to live. In the past we found it was more of a place for people to come and retire.

I still remember moving here from inner city of Sydney and wondering, what have I done! There was barely in great restaurants or cool bars.

COVID really has made southerners realise what an amazing lifestyle we have up here and sped up the growth we were due to have.

What a great time to buy in Brisbane. maybe your first home, upgrading or moving out of the city to the bush or coast.

Check in with Boss Money to find out what you can do.

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