2020 Property Boom

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EXPERT OBSERVER
Regional Queensland markets are at their strongest in three years, with growth momentum unfolding in multiple centres across the state.
Our Autumn 2020 survey of sales activity shows that Regional Queensland has 55 locations with upwardly mobile markets, the highest we have recorded in our quarterly surveys since early 2017. There has been only one better quarter in the past five years.
The number of “declining” markets has reduced (from 12 six months ago to six now) and there are now few danger markets outside of the perennial struggler, Mount Isa.
Resources-related centres which have been in decline previously - including Gladstone, Emerald and Moranbah - are showing increasing signs of recovery, with notable uplift in median house prices in these places.
The Sunshine Coast continues to lead Regional Queensland in terms of the number of suburbs with rising demand. It has 12 growth suburbs and numerous others with steady buyer demand.
The Sunshine Coast has a strengthening economy boosted by massive spending on infrastructure as it transitions from tourist town to international city. A $400 million upgrade will allow Sunshine Coast Airport to accept international flights later this year, while the Sunshine Coast International Broadband network will create the fastest internet connections to Asia anywhere in eastern Australia via the subsea cable.
The Sunshine Coast is also building a 53ha CBD from the ground up and a $5 billion medical precinct is well under way.
Nearby Gympie also has growth markets and benefits from offering an affordable alternative to the Sunshine Coast, to which it is well-connected following billion-dollar highway upgrades.
The big improver in our Autumn survey is Cairns, which now has nine suburbs with growing sales activity. Some of its suburbs are producing solid growth in their median prices.
This puts Cairns on level terms with the much-larger Gold Coast City, which also has nine growth suburbs but 33 suburbs with plateau markets - which suggests the Gold Coast market overall is solid but not heading into big price growth.
Townsville is gradually fighting back from the devastating floods of early 2019 and now has five upwardly mobile suburbs but, as yet, no compelling evidence of price growth.
There is growing evidence of recovery in resources towns in Central Queensland. Gladstone, which was plunged into downturn by developer oversupply, now has lower vacancies, better sales activity and prices are rising again - but still remain well below the pre-downturn peak levels. Anyone tempted should remember the volatility shown by this market in the past.
Iconic coal mining town Moranbah is also fighting back. Its median house price rose 11% in the past year to reach $230,000 - but with a long way to go reach the heights of the mining boom when the median topped $700,000.
Emerald continues to improve, with its median price up 10% to $330,000 in the past year.
Blackwater’s situation shows how much these markets fell after the mining boom stopped - and how deceptive median price statistics can be. Its median price has risen 42% in the past 12 months but is still just $140,000. Previously, typical values had plunged to below $100,000.
Mackay has stood out in recent surveys as a recovering market with good growth prospects and currently has four suburbs with rising sales activity. Rockhampton has potential but as yet has not joined the upward trend.
The important inland city of Toowoomba is showing promise but, as yet, has no compelling evidence of significant growth.
The overall improvement in sales volumes across Regional Queensland is beginning to show up in price performance. Our research shows that half of the towns and suburbs of Regional Queensland have recorded some level of price growth in the past year.
The strongest performers overall have been the Sunshine Coast and the Gold Coast, with Cairns locations also starting to show up.
Sunshine Coast leaders in annual price growth include Warana (up 19%), Parreara (up 12%) and Alexandra Headland (up 18%) for houses, and Buddina (up 26%) for apartments.
The best on the Gold Coast have been Palm Beach, Worongary and Surfers Paradise (all up 10%) for houses, and Burleigh Heads, Currumbin Waters and Clear Island Waters (all up 10-12%) for apartments.
The tourist town of Port Douglas, which is part of the Cairns LGA, is notable for delivering good median price growth for both houses (up 11%) and apartments (up 7%) in the past year.
TERRY RYDER is the founder of hotspotting.com.au ryder@hotspotting.com.au twitter.com/hotspotting
To win a free investment strategy session with Terry Ryder, complete our <a href="https://www.surveymonkey.com/r/ZXRSJVJ" target="_blank">sentiment survey here</a>.
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Sunshine Coast drives regional QLD property to strongest point in three years: Hotspotting’s Terry Ryder

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EXPERT OBSERVER
The Perth market is – at last - showing solid signs of recovery from five years of dogged downturn. Hotspotting's Autumn survey of sales activity has found 51 suburbs with rising demand, up from 34 six months ago.
In the five years we have been conducting our quarterly surveys, there has been only one other quarter with more rising markets.
This occurred early in 2019, when Perth appeared on the road to revival before it was snuffed out by the impending Federal Election, the Banking Royal Commission and overwhelming media negativity.
Now the recovery in the WA capital is back on track, with the city's middle market leading strongly and some of the first-home-buyer markets starting to show vitality. A significant reduction in vacancies and consequent uplift in rents is underpinning the resurgence.
Three precincts stand-out as the market leaders – the municipalities of Stirling, Joondalup and Wanneroo, which jointly have half of Perth's 51 rising markets. These areas have been among the most resistant to the prolonged downturn and it's not surprising to see them at the forefront of the upturn.
We have previously commented that the Stirling LGA has been a "sterling performer" amid Perth's down market. And now it is the leading precinct in the recovery: our Autumn survey had identified nine suburbs with rising sales activity and numerous others with steady demand. The suburb of Dianella (median price $555,000) has lifted quarterly sales from 99 to 101 to 108 to 110 to 121 to 126 over the past 18 months.
In the north of the city, regular leader Joondalup and neighbouring Wanneroo both have eight suburbs with rising momentum. Joondalup is consistently among the most resilient of the Perth markets, boosted by excellent infrastructure and a cluster of good suburbs with attractive pricing. Quarterly sales in Hillarys have been 47-50-50-54-55-58-63.
Wanneroo is one of WA's leading population growth areas and a provider of new suburbs and housing estates which attract younger buyers. The evolving suburb of Alkimos has recorded quarterly sales of 32-35-38-46 over the past year.
Closer to the inner city, Cockburn continues to stand out as a solid performer. It has six rising suburbs and seven others with consistent buyer demand.
One precinct that is usually prominent but currently less so is the Melville LGA. It currently has just three rising suburbs and there has been a noticeable falloff in some of the more upmarket suburbs in this precinct. Median prices have dropped in million-dollar suburbs like Applecross (down 11%), Bicton (down 16%) and Ardross (down 14%).
We're starting to see some revival towards the bottom end of the market. Wanneroo is one of the market leaders and the Rockingham LGA in the south, which has not featured in any major way in our reports over the past couple of years, is now showing signs of rising.
Other affordable precincts, however, are yet to spark to life. LGAs like Canning, Gosnells and Armadale have lots of plateau markets – where sales activity is steady but well below the peak levels – and as yet no suburbs with rising sales activity. And prices remain down.
Overall, the Perth is showing strong indications of recovery in terms of sales activity, vacancies and rental growth – but it has yet to translate into widespread uplift in prices.
Only 22% of suburbs have recorded annual growth in median house prices and just 30% of suburbs have had annual increases in median apartment prices.
The areas where the best growth has occurred are largely middle market areas, with the Stirling LGA particularly prominent.
Stirling suburbs with annual median price growth well above average for Perth include Carine (up 6%), Woodlands (7%) and Inglewood units (9%), but the market leader is Wembley Downs (up 16%).
Prices are still dropping in downmarket areas like the LGAs of Canning, Gosnells, Kwinana and Armadale. Examples include the suburbs of Armadale (-11%), Bentley (-11%), Cannington (-11%), Ferndale (-10%), Gosnells (-10%), Kelmscott (-15%), Leda (-10%) and Medina (-15%).
TERRY RYDER is the founder of hotspotting.com.au ryder@hotspotting.com.au twitter.com/hotspotting
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Perth property market finally showing signs of recovery in 2020: Hotspotting's Terry Ryder

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EXPERT OBSERVER
The Brisbane market is showing meaningful improvement and appears ready for a long overdue boom. Every statistic that matters depicts uplift in the Brisbane market and prices are expected to rise in 2020.
Many commentators have forecast a Brisbane boom in recent years, though many were simply assuming that the Queensland capital would follow the lead of Melbourne and Sydney. Brisbane, however, has lacked the core growth drivers that boosted markets in the two biggest cities.
But, increasingly, growth parameters are lining up for Brisbane. Population data is favourable, the affordability comparison is helpful, surveyed investors say they are targeting Brisbane – and the major piece of the puzzle previously missing, infrastructure spending, is starting to happen.
I have commented in the past: “Brisbane is like a car where the engine is revving but it can’t move forward because the handbrake is on.” Perhaps the handbrake has been released - a growing number of analysts are tipping good price growth in Brisbane this year (including Domain, BIS Shrapnel and Westpac) and I tend to agree.
My Autumn 2020 survey of sales activity reveals 37 suburbs with rising buyer demand, the second best result for Brisbane in the past three years – and almost double the number six months earlier. There has also been a marked decline in the number of problem locations (those classified as declining or danger markets).
Vacancy rates continue to improve, though there are still areas of weakness, and 43% of Brisbane suburbs have delivered annual growth in their median house prices, including double-digit uplift in the strongest areas.
There is particular strength in the northern suburbs of Brisbane – the Brisbane North precinct and the Moreton Bay LGA jointly account for 21 of the 37 suburbs ranked as rising markets. The southside has many of the struggling markets and Brisbane’s inner-city, while improving, still has its problems.
The Brisbane North precinct and its neighbour Moreton Bay Region are the standouts, as they have been in our surveys in the past.
Brisbane North has 13 suburbs classified as rising markets, another 24 suburbs with steady sales activity and none ranked as declining or danger markets.
The uplift in sales activity is producing solid price growth in many of these suburbs, well above the average for the Brisbane metro area. Kedron has recorded annual rises in its median prices for both houses (up 6%) and apartments (up 11%), while Windsor is up 22% for houses and 6% for apartments.
Newmarket’s median house price is up 16%, Northgate has risen 14%, while Stafford, Nudgee and Geebung have all increased between 6% and 8%.
The Moreton Bay Region LGA has regularly been the best-performing Brisbane market, boosted by affordability, good infrastructure and proximity to employment nodes. It’s been overtaken by Brisbane North in the latest survey, but remains a significant market.
The February 2020 opening of a new university campus will boost demand in nearby suburbs like Petrie and Lawnton (Petrie is already rated a rising market and is likely to get stronger as the campus effect clicks in).
Other precincts have some growth markets: Brisbane-east, Brisbane-south and Brisbane-inner each has four suburbs with rising sales activity. Currently these are out-numbered by plateau markets, but I expect that to change as the year rolls on.
The Brisbane-inner precinct is a confusion of suburbs with contrasting rankings: the 22 ranked suburbs in my Autumn 2020 survey include 4 rising, 7 plateau, 1 consistency, 7 declining and 3 danger. The danger markets (Albion, Fortitude Valley and Kelvin Grove) are those where sales activity has dropped markedly, prices are down and vacancy rates remain high. This, however, is an improvement – 18 months ago the Brisbane-inner precinct had 12 suburbs classified as danger markets.
It’s noteworthy that many of the Brisbane locations with solid median price growth in the past year are situated towards the upper end of the market. They include Hamilton ($1,560,000, up 11%), Balmoral ($1,050,000, up 7%), Indooroopilly ($950,000, up 12%), Newmarket ($950,000, up 16%), Rochedale ($1,035,000, up 7%), Sherwood ($935,000, up 7%), Toowong ($890,000, up 10%) and Windsor ($940,000, up 22%).
Inner-city Highgate Hill stands out with good median price both for houses (up 8%) and apartments (up 10%).
Usually, up-cycles in capital city property markets begin at the top end and ripple out from there.
TERRY RYDER is the founder of hotspotting.com.au ryder@hotspotting.com.au twitter.com/hotspotting
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2020 Property Boom

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