Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Joel Robinson

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

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The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

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Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

[smartcode_project_cta:default project_id=102717]

Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

[smartcode_project:default project_id=5743 project_image_fid=925]

Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

[smartcode_project:default project_id=5743 project_image_fid=5374]

The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

[smartcode_project_cta:default project_id=5743]

The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

The long-planned transformation of Brisbane's historic Shafston Estate has taken another major step, with Capella Hotel Group announced as the luxury hospitality partner behind what will become Brisbane's first branded residences.

The project, to be known as Capella Residences Brisbane, is being delivered by Verso Projects at the landmark Kangaroo Point riverfront estate, with completion targeted for 2029.

The announcement follows a series of planning changes to the project over recent years. The site was originally approved in 2023 for a 15-level, 37-apartment development designed by Rothelowman for Burgundy Group before Verso Projects took over the 10,070 sqm riverfront holding and lodged revised plans with Kerry Hill Architects to increase the development to a 25-level tower with 51 apartments.

The latest announcement confirms Capella Hotel Group will bring its branded residential offering to the project, marking just the second Capella Residences development globally after Seoul, and the group's first branded residential project in Australia.

The <a href="https://www.apartments.com.au/new-apartments/23-castlebar-street-kangaroo-point-qld-4169">Castlebar Street development</a> will centre around the restoration of the heritage-listed Shafston House, one of Brisbane's oldest residences, originally constructed in 1851 by Reverend Robert Creyke as a single-storey cottage known as Ravenscott.

<img alt="Capella" data-entity-type="file" data-entity-uuid="2b9f4ce5-638f-4d6b-8082-3ca7e4b75fca" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-09%20at%207.20.41%E2%80%AFAM.png?VersionId=f7aeqsW_DzOJI4FymWb3lD8NptSfsP7q" />

Capella said the project aligns with its focus on heritage-led developments, with the Brisbane estate combining the restored historic residence with a new luxury apartment tower and hospitality-inspired resident amenities.

Residents will have access to the Capella Living Room, a concierge-led communal space inspired by the group's luxury hotels, alongside landscaped gardens, six swimming pools, wellness and recreation facilities.

The broader estate will also include two riverfront homes, a six-berth private marina, porte cochère arrival experience, secure basement parking and a new section of public riverwalk along the Brisbane River frontage.

The heritage Postal Depot Building will also be retained and repurposed as a guest house, in line with the revised development plans.

The project represents another evolution for the site, which Kerry Hill Architects previously described as a rare opportunity to restore one of Brisbane's most significant heritage estates while creating a new benchmark for apartment living.

"The Shafston Estate provides a once-in-a-generation opportunity to restore one of Brisbane's finest heritage precincts and to reinstate residential use as a unique site perched on the edge of Kangaroo Point," Kerry Hill Architects said in its Urban Context Report accompanying the planning submission.

"The project will celebrate excellence in sub-tropical residential design, setting a new benchmark for vertical living in Brisbane."

Verso Projects, which now has an $8.5 billion development pipeline spanning more than 6,000 dwellings across apartments, townhouses, retail and commercial projects, said the partnership with Capella would elevate the development beyond a traditional residential project.

"We feel honoured to be restoring Shafston Estate to its former glory, elevating it to new heights of luxury and excellence underpinned by Capella's distinctive service ethos and design philosophy, and making it a standout landmark in Brisbane," Verso Projects CEO Steve Laffey said.

"By partnering with Capella, globally recognised for its refined approach to luxury hospitality and deep respect for cultural and historical context, we will elevate this project beyond a residential offering into a world-class destination."

Capella Hotel Group President Roland Fasel said Brisbane's emergence as a global city made it the right location for the company's Australian residential debut.

"Brisbane is a city on the cusp of something remarkable, and Capella Residences is our commitment to being part of that story," Fasel said.

"The Capella residential experience is more than luxury. It is about a sense of belonging to a place with deep meaning."

Private appointments have now opened for the project, with a display suite expected to open in late 2026 ahead of the planned 2029 completion.

Capella to launch Brisbane's first branded residences at Shafston House, Kangaroo Point

Brisbane

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Melbourne's preliminary weekend clearance rate was 44.1 per cent after 197 reported price results from the 483 scheduled auctions.
The tally included some 193 withdrawn from auction, Domain reported.
It was the second July weekend with the rate in the 40s after the return to lockdown across the capital city. 
There were 85 reported online Melbourne auctions, with 60 selling, which was the highest recorded success rate for online to date, Domain research analyst Nicola Powell advised.
Melbourne's top sale was <a href="https://www.realestate.com.au/sold/property-house-vic-kew-133806986" target="_blank">45 Walpole Street, Kew</a> (pictured) which fetched $4.21 million prior to its scheduled online auction.
Melbourne also saw a $3.67 million St Kilda West home.
The four-bedroom, two-bathroom house at 8 York Street was announced on the market at $3.5 million, by the Marshall White Stonnington agent John Bongiorno.
Sydney's preliminary clearance rate on Saturday was 64.6 per cent, after 471 scheduled auctions and 270 reported results. The rate included 77 withdrawn auctions.
The nation's cheapest was the $300,088 pre-auction sale at 15/38 Barrett St, Robertson. It had last sold from $80,000 in 1983.
Brisbane's top sale was just over $1 million when 43 Saint Helens Rd, Mitchelton was sold at $1.09 million.
Sydney’s highest sale was a four-bedroom, four-bathroom home in Vaucluse, on the market for the first time in 65-years.
It sold for $5,695,000 through Sydney Sotheby’s agent Michael Pallier.
There were five registered bidders for 61 Village High Road.
‘The buyer was a local but what drove the price was an expat in Singapore who had never seen the house and had a family member bidding for them. The third bidder, who bid up to $5.5 million, wanted to buy it for his 18-year-old daughter as a long-term hold. He looked at it an hour before the auction.," Pallier told Nine Entertainment.
Canberra had the country’s highest preliminary clearance rate of 90.6 per cent – reflecting the sale of 29 out of 32 reported auctions by CoreLogic.
 
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Melbourne auction weakness remains while Brisbane comes up the cheapest

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With restrictions easing on 15 May, Queensland saw relaxations for the real estate industry, according to the latest Herron Todd White (HTW) residential report. 
The valuation firm took a look at how a budget of $700,000 could be invested in property markets across the nation. 
"There’s plenty to dig into for this month’s topic but first, a quick update on how our market is tracking," the valuation firm said. 
In-house auctions can now be conducted with ten members of the public present and a maximum of three agency representatives running the auction. 
Open home inspections can be carried out with a maximum of ten people allowed access. Names, addresses and mobile numbers must be taken by agency staff of any attendees for contact tracing purposes too.
"The easing of restrictions has seen an increase in listings and more activity at open homes. We have, however, yet to see evidence of changing transaction volumes or price movements. 
"That said, it is worth noting that Brisbane’s economy remains well placed for the future given the state’s low infection rate and slow-but-steady opening of businesses," the valuation firm said. 
"We note with some interest that subject to there being no second wave of infection, analysts remain optimistic of Brisbane’s property market remaining stable and likely for long-term recovery from this point on," the valuation firm said. 
"So, how should you spend that lazy $700,000?
"First up, let’s talk about who is buying at this price point. We are seeing activity from owner-occupiers, investors, upgraders, families and some first homeowners.
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"That’s right! Pretty much every buyer type is represented in some form," the valuation firm continued. 
Next, let’s see where you might spend this handsome chunk of change.  $700,000 will get you within reasonable proximity of the CBD, the report noted. 
For example, the desirable northern suburbs of Hendra, Wooloowin and Clayfield all have entry- level pre- and post-war dwellings on 405 square metres in secondary locations within this price point. 
"If you want to be within these desirable addresses and need something a bit newer, consider a new or near-new townhouse with three-to-four bedroom, two-bathroom, two-car accommodation," the valuation  firm said. 
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In locations such as Gordon Park, Stafford and Kedron, a detached dwelling on 405 square metres would be a good option. 
"In fact, we consider this a very strong market sector at present with good capital growth potential. If you have the money and are keen to invest, put these suburbs on your shortlist," the valuation firm said. 
Windsor, Wilston and Newmarket are well-serviced, inner-north addresses popular with families. There are some stunning residences here, however at this price point you’re likely to buy a modern townhouse that will have good value growth potential over the long term, the report noted. 
Heading south and the Carina and Carindale areas provide opportunity. A 1970 to 1980 high-set style dwelling with three-bedroom, one-bathroom accommodation and in good condition will be within your price range.
"If you need another bedroom, it’s still possible to buy at $700,000, but you might need to settle for a secondary position," the valuation firm said. 
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"Other addresses south of the river and within striking distance of this price point are Coorparoo, Camp Hill and Hawthorne, but you may have to settle for something on a busy road or small lot and you’re likely to find just two-bedders within the budget. Suffice it to say, you’re looking for an eager seller if this is your patch and price point," the valuation firm said. 
As mentioned earlier, the Coronavirus crisis has not resulted in a measurable fall in property prices across the Brisbane market generally and $700,000 is a solid value band, the report noted. 
As such, don’t expect to score a bargain due to the pandemic. A lack of listings means buyer choice is limited. In addition, many properties are trading off-market.
"So, what might offer excellent bang-for-buck at $700,000 in Brisbane?
"Our advice is usually to purchase as close as possible to the CBD for your budget. And in most cases, choose detached housing over and above attached housing and units. But at $700,000, your options are limited when it comes to suburbs within a five-kilometre radius of town," the valuation firm said. 
As such, choose fringe to mid-ring suburbs within close proximity to school catchments, amenities and public transport. You will also get larger housing lots for your budget in suburbs a bit further out, the report noted. 
"Our initial thoughts at this price point would be a reasonable quality home in Carina or Wynnum. Something on a circa 600 square metre allotment with an older highset dwelling to a good standard," the valuation firm said. 
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Gordon Park, Stafford and Kedron and their detached dwellings on 405 square metre lots are good options too. This is a buoyant part of the market at the moment and has good potential to achieve capital growth.
A current listing is a three bedroom house in Kedron with a price guide of $649,000.
Set on a 415sqm block, the <a href="https://www.realestate.com.au/property-house-qld-kedron-133701926" target="_blank">12 Howell Street</a> home (pictured below) comprises three bedrooms, open plan living and dining space, covered deck and double garage. 
It is situated within walking distance to local schools, shops and cafes. 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/7/13/kedron.jpg" alt="">
Also – for cash flow investors, have a look in the mid-to-fringe areas for duplex, dual occupancy or multi-unit/flat properties. These structures are still available within the dollar amount and the gross returns can be very strong.
"If you have your heart set on buying an apartment, then act with caution," the valuation firm said. 
New apartments in mid-ring localities as well as investment product throughout Brisbane should be viewed as medium-to-high risk even though they offer a lower price point in comparison to single unit dwellings. There’s still a large supply hanging over from previous years’ excess development and a softening in values is evident for off-the-plan purchases.
In short, capital growth in investor style units is highly unlikely in the short term, the report suggested. 
For example,<a href="https://www.realestate.com.au/sold/property-apartment-qld-cannon+hill-132163162" target="_blank"> Unit 511/22 Andrews Street, Cannon Hill </a>(pictured below) just sold for $375,000.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/7/13/cannon%20hill.jpg" alt="">
 It was previously purchased for $417,500 in October 2017. That’s a pretty hefty discount of 9.7 per cent over an almost three-year period, the report noted. 
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Instead of new, consider an older apartment with renovation potential in a good location with transport and amenities nearby.
Finally, $700,000 invested in Brisbane property will probably achieve a gross rental yield of around four to five per cent. 
For example, detached houses and townhouses in Gordon Park, Stafford and Kedron achieve circa $550 per week.
"The future of property at this price point looks stable over the next couple of market cycles, although caution is required in the short-to-mid term under current market conditions. There’s still too much uncertainty out there at present," the valuation firm said. 
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What a lazy $700,000 can buy in Brisbane: HTW residential 

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Brisbane saw a fall in the incidence of profit-making resales in the March quarter, comprising 87 per cent of these transactions. This is down from 88 per cent in the December quarter, and 88.4 per cent in the March 2019 quarter.
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Source: CoreLogic Pain and Gain March Quarter 2020 report.
The house market continued to show strong returns relative to the unit market. Over the quarter, 94.6 per cent of houses saw a nominal gain compared with 63.8 per cent of units. This is due to the ongoing, divergent capital growth performance between houses and units. In the 5 years to March 2020 annualised growth across Brisbane houses was 2.7 per cent, compared to -0.8 per cent in units.
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These conditions also inform the loss making sales seen across the Brisbane Council Region. In the March quarter, 15.1 per cent of resales saw a loss. Of these loss-making sales, 88.3 per cent were units. It is also noteworthy that across the Brisbane council region, 66.0 per cent of loss making sales had been held by investors.
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Interestingly, the area with the highest portion of loss making sales was the Lockyer Valley Council region. This portion is off a small base, with only 21 sales in the quarter seeing a nominal decline at resale. Most of these were houses, and had a relatively lengthy median hold period of 9.7 years. However, the median loss on these properties was also relatively small, at $20,000.
While dwelling market demand may continue to be impacted by COVID-19, a bright spot for ongoing demand in the Queensland market is interstate migration. Over the past few years, Queensland has been the largest recipient of interstate migrants, who typically come from New South Wales or Victoria. The imposed lock down which has seen many adapt to working from home could create added demand for South East Queensland property from owner occupiers as demand returns to the economy. This is because SEQ offers a far more affordable housing price point compared with those in Sydney and Melbourne, and may have greater lifestyle appeal for some.
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Source: CoreLogic Pain and Gain March Quarter 2020 report.
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Brisbane sees a fall in the profit-making resales: CoreLogic Pain & Gain 

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Brisbane house and unit rents fell over the June quarter, although rents remained flat over the year, according to the June quarterly rental report from Domain.
While the Brisbane rental market has not been as impacted compared to other cities, international border closures, plummeting foreign student numbers, job losses and pay cuts have still made their mark, with Brisbane’s CBD particularly exposed to reduced rental demand.
The number of advertised rentals jumped from March to June and more landlords have cut asking rents.
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June 2020 QoQ change for Brisbane rental prices
“Brisbane house and unit rents fell over the June quarter, although rents held steady over the year. The rental market is fragmented across Brisbane’s regions. House rents in higher priced areas weakened, while prices in more affordable areas were steady in their asking rent. Units in Brisbane city had the steepest quarterly fall while several areas remained stable or marginally increased.” “Brisbane’s vacancy rate has nudged higher compared to last year, despite this the number of advertised rentals are shrinking from the time of the city’s construction boom. It stems from the recent reduced demand temporarily lifting the number of available rentals. To date, the Brisbane rental market has not been as affected compared to other capitals, but international border closures, plummeting foreign student numbers, job losses and pay cuts have had an impact. Brisbane’s CBD is particularly exposed to the reduced demand, with advertised rentals jumping from March to June and more landlords cutting asking rents.”  “Sunshine Coast rents remain at record highs, with houses at $500 a week, steady from last quarter and units at $410 a week which have held at this high for a year. The Gold Coast is a two-speed rental market: house rents remain at a high of $520 but unit rents dropped over the quarter and year, marking the first annual fall since 2013. Gold Coast unit prices are likely to be more exposed to a drop in international tourism,” said Domain Senior Research Analyst, Dr Nicola Powell.
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Brisbane rental market not his as hard as other cities: Domain

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Buyer demand for <a href="/developments/brisbane-qld">Brisbane</a> houses has returned to levels pre-crisis over recent weeks with dozens of people at some open homes.

Negotiations for strategically placed properties are much tougher than they were with more buyers competing over a low volume of listings.

During the peak of the <a href="/expert-insights/buying/how-will-the-coronavirus-impact-australia-s-property-market">coronavirus pandemic</a>, we remained active in middle-ring locations that offer houses around the $400,000 to $500,000 mark, and mostly had the pick of the crop. Now, listings are still constrained, but the number of active buyers has surged two- to three-fold compared to March and April. In fact, we have seen up to 30 groups going through just one open home because of the lack of stock with <a href="/guides/how-to-buy-a-house-in-2021-a-guide-for-first-time-home-buyers">first home buyers </a>and owner-occupiers as the most common buyer type. 

This state of play is reflected in the latest data and analysis by the Real Estate Institute of Queensland (REIQ). The <a href="https://www.reiq.com/whitepapers/queensland-market-monitor/">REIQ’s Queensland Market Monitor </a>(QMM), released on Friday, found that the Sunshine State property market was in fine shape during the first three months of the year. According to the QMM, Brisbane’s median house price increased 0.7% over the March quarter and had strengthened by 1.5% over the year ending in March as well. Greater Brisbane’s market – including the Logan, Moreton Bay, Ipswich, and Redlands regions – was also performing well, posting median house price growth of 1% over the year as well. Temporary pause 
Local experts interviewed for the analysis say the Brisbane market, as well as all other major markets, took a breather in April as peak virus uncertainty hit the state. However, by May, green shoots of confidence and improved consumer sentiment had started to appear. This market resurgence continued into June, which is what we are currently witnessing on the ground in Brisbane.

It seems that owner-occupiers and first home buyers with the means to purchase are attempting to do so. First-time buyers, in particular, are active in those suburbs that still have affordable <a href="/guides/how-to-invest-in-property-in-2020-the-ultimate-guide">investment-grade </a>housing.

A few months ago, when asked by the media how the Brisbane market was faring, I said properties were achieving their listing prices but there wasn’t the fight from buyers to push prices much higher. Fast forward a few months, though, and that situation has started to change, mostly because of the continued reduced stock levels.

<a href="https://www.corelogic.com.au/research/monthly-indices">CoreLogic’s Home Value Index</a> found that median house values in Brisbane stayed stable in June and had increased by 1.9% since the start of the year – a result superior to Melbourne over the same period.

But I wouldn’t say it’s a seller’s market by any stretch.

That’s because, while there are definitely more buyers out there, most of them don’t seem to have any sense of urgency. Mostly, because they believe there will be a significant property price slump come September when the <a href="https://www.ato.gov.au/general/jobkeeper-payment/">JobKeeper</a> payments are wound back as well as mortgage repayment pauses.

Long-term focus 
Personally and professionally, I don’t believe the Brisbane market will experience any major impact from the ending of these initiatives.

Lenders will not want a flood of mortgagee sales for starters, so they will work with customers experiencing financial distress to prevent such a thing happening by extending repayment holidays or reductions.

That said, it is almost a moot point because savvy property buyers and investors always purchase when <a href="/news/debunking-the-bad-market-myth">conditions</a> are right for them, including when there are market opportunities. They also understand that to create property wealth, they need to hold their investment properties for the long-term, so it is irrelevant to them what may or may not happen in September.

With interest rates so low, and with a reduced volume of buyers compared to the average currently in the market, there has never been a better time to secure a holding in Brisbane in my opinion.

Not only does the sunshine state capital offer affordable house prices, but rental yields are also usually much higher than in southern states.

Thus, I’m picking that interstate migration into Queensland will start to soar once borders are reopened as more people opt to <a href="/guides/covid-19-how-to-adapt-to-working-from-home">work from home</a> from one of the most beautiful places in the world.
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Demand for Brisbane Property Soaring

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The initial stages of the COVID-19 crisis caused many sellers to shut up shop and batten down the hatches, according to the latest Herron Todd White (HTW) residential report. 
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The valuation firm suggests in locations across the nation, the downtime delivered by isolation has spurned on owners looking to improve their assets through maintenance and upgrade. This month’s HTW report highlights where renovations are on the rise and the price points and outcomes those markets can expect.
"First up – let’s address the current state of play under COVID," the valuation firm said. 
The report notes some buyers believed they were about to snatch up outrageously good deals.
The market then settled quickly into a standoff where potential purchasers came up against a lack of stock. As such, transaction numbers dropped dramatically, but prices didn’t.
Now, three and half months in, the state of play is established. There is a still a wait-and-see approach being taken by owners, so buyers don’t have a heap to choose from. Prices are softer across many markets but they didn’t plummet like some may have predicted.
"Of course, this is an evolving situation. As we move through the machinations of the economy over the next six months - with politics, employment, finance, immigration and trade all playing their parts - thing could be turned on their head. It’s a case of wait, watch and see.
"Of course, the crisis has delivered us something that was in short supply for the average Aussie family – time," the valuation firm said. 
Requests from leadership that we stay in and keep each other safe had many running to Netflix and home offices, but there was also a fair proportion of the population who used the opportunity to tackle odd jobs around the house.
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"Skip bins and Bunnings lines revealed that when presented with the chance to do nothing, many of us actually want to do something productive.
"That said, most of what we’ve seen around the suburbs was maintenance," the valuation firm said. 
In Brisbane at least, demand for more extensive building and renovation work looks to have slowed, the report noted. 
Many households stepped through the uncertainty of March and April making plans to ensure that, over the foreseeable future, food would be on the table and a roof would stay overhead. Being frivolous with available cash could be hazardous with unemployment on the rise.
"As such, we generally observed a slowdown in substantive renovation and construction projects – particularly any ventures that involved signing a contract with a builder or tradesperson.
"But, as has been said many times before, you need to dig below these broad market generalisations and understand the nuances, because opportunity can be found at certain price points, property types and locations," the valuation firm said. 
For example, prestige property is seeing relatively more renovation upgrades than homes in the affordable price sector.
The report notes renos of inner-city holdings at the upper-price level have been mostly unaffected by the current environment. Owners are comparatively cashed up and willing to keep spending.
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"There’s plenty of reasons why. For starters, the lowest interest rates in living memory are enabling those with good financial standing to get access to cheap money," the valuation firm said. 
In addition, the building industry has become relatively competitive under the COVID regime. Tradespeople are hungry for work and head contractors are willing to compete on price so as to secure a pipeline of projects.
"The flipside in Brisbane is the investor market. We aren’t seeing landlords looking to spend sums upgrading homes beyond what’s necessary at this stage," the valuation firm said. 
There’s an expectation the rental market will continue to fall in favour of tenants with rising vacancies and falling rents, so investors are wanting to ensure they don’t spend too big too early.
"One thing that may well stimulate the desire for upgrades among homeowners is the work-from- home phenomena.
"It’s become evident many of us can operate productively from a home office. It’s also entirely possible on the other side of this event, employers will look for ways to reduce their office footprint, hoping to cut lease costs and improve the bottom line," the valuation firm said. 
The outcome may well be property owners seeking ways to adapt their current living space in order to improve their work environment.
Creating a work area that can be shut off from the family space will become an essential element of any home. Even if existing owners don’t look to create that for their own use, a good home office will be a feature in future real estate listings.
If there’s an efficient, cost-effective way to establish an office, then vendors will want to do this prior to selling.
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"And so on to locations if you do have a hankering for a renovation project. We’ve looked at a couple of options that might fit the bill," the valuation firm said. 
For example this one at 17 Hockings Street, Clayfield (pictured below) sold mid-2019 for $660,000 as a renovation project that required a heap of TLC.
"No doubt the original features will come up a treat," the valuation firm said. 
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The inner-west suburbs of Paddington, Auchenflower, Bardon and Toowong have been rife with renovation opportunities for decades.
 In fact, there have been a few Brisbane builders who’ve grown their fortunes by concentrating solely on these locations and completing beautiful, multi- million dollar do-ups.
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For example, this house at 12 Carey Street, Bardon (pictured below) was sold way back in October 2017 for $770,000.
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It received an extensive upgrade to become an ultra-modern four-bed, three-bath, two car home (pictured below) that was purchased in March 2020 for $1.552 million.
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Family friendly addresses such as The Gap: provide opportunity for those with a tighter budget. Renovatable home are available at the high-$500,000s price point.
"For those with a little more to spend, an address such as Ashgrove will set you back closer to $700,000-plus for a home with potential," the valuation firm said. 
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A perennial favourite for fixer-uppers is Petrie Terrace and Spring Hill. There are some raw homes on tiny lots for over $600,000, but it’s all about location here. 
The report notes these suburbs are literally walking distance to the centre of town as well as entertainment and retail precincts. And the results can be spectacular.
For example, a renovated home at 35 Sheriff Street, Petrie Terrace (pictured below) sold in November 2019 for $1,193,888. It’s on 228 square metres of land and provides four-bed, three-bath, three-car accommodation.
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"Looking a bit further out and Wavell Heights has good options with very basic renovators in average positions fetching between $550,000 and $600,000 – but you need to be fast as they sell quickly," the valuation firm said. 
 Other homes in Wavell Heights that’re in quieter positions with ready access to facilities are fetching between $600,000 and $700,000 for a renovation prospect. 
In these instances, smart renovation work will yield an end value above $1 million.
For more budget conscious renovation prospects, head a bit further up Gympie Road and check out Aspley and Bracken Ridge where a renovatable home can be purchased in the $500,000s. This area appeals to first home buyers and project- oriented builders.
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"A quick tip – make sure you check the town planning guidelines and building codes before proceeding. 
"The renovation options for Brisbane property can be limited by heritage and traditional-character overlays, building heights, setbacks, noise and flooding issues and other designations... and they can be property specific. Just because a neighbour is able to get certain works approved doesn’t necessarily mean you can," the valuation firm said. 
"Finally, while the level of future renovation activity remains generally uncertain, falling sale numbers under current market conditions in the wake of COVID may well fuel a rise in renos, however this will be dependent on indicators such as general confidence in the market, affordability, unemployment and economic conditions." 
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Brisbane prestige property renovation least affected by COVID-19: HTW residential 

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The quick progress of COVID-19 has brought swift ramifications for the real estate industry, according to a recent Herron Todd White (HTW) residential report. 
<div>The current COVID-19 epidemic is going to have a negative impact on key drivers, so it will be interesting to see what impact this may have on the property market in the short to medium term, the valuation firm said.</div>
"No open homes, no in-room auctions. In short, professionals are having to adapt quickly to ensure the economic wheels keep turning.
"It would come as no surprise that the overriding element at present is the medical, social and economic fallout from virus control measures," the valuation firm said. 
"In Brisbane, the full effect is still to play out, but we can at least take some comfort in not having to deal with population densities like Sydney and Melbourne. A small blessing for the Sunshine State," the valuation firm commented. 
"For the sake of this month’s submission, let’s look beyond COVID-19 and set aside the economic downturn and recovery period to some degree (as we’re not certain as yet how long this challenging time will last)."
"So, what are the elements that traditionally drive the Brisbane market and how might they look in the future?
"The metrics and measures we’ve customarily watched as Brisbane property indicators have included the general economic outlook (nationally and locally), employment numbers and job security, interstate migration, wage growth, interest rate movements, local, state and national elections and the availability of finance," the valuation firm said. 
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It’s a complex dance of interaction between these components that sets the level in terms of activity and price growth potential.
"To give some perspective, 2019 saw a somewhat challenging start in the first half of the year with a number of headwinds. These included the banking royal commission that led to a redefining of lending policies by financiers. There were mid-year elections plus a feel that southern markets had overheated as well.
"We were also struggling to get our Queensland unemployment rate lower. All these elements contributed to our unimpressive residential market performance and general confidence," the valuation firm said. 
Then, the second half of 2019 saw a market back on the rise.
 There was an increase in confidence as lending restrictions were loosened, Brisbane’s major infrastructure projects got underway in earnest and interstate migration numbers continued to improve.
It was, for all intents and purposes, looking like a very promising 2020 before the handbrake was applied by the pandemic, the report said. 
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"Of course, once we pass through this time of uncertainty, Brisbane property operators will be looking overall for leading indicators such as employment and wages growth," the valuation firm said. 
The report suggests there will no doubt be an appetite for infrastructure projects to be back on track and, as mentioned, that all important net interstate migration number.
For those interested in some nuances, there are different drivers for different buyer types.
For example, first home buyers in Brisbane are traditionally stimulated by affordability, the level of competition from investors, first home buyer’s grant and stamp duty incentives, interest rate reductions and the ability to save for deposits and get finance. 
Some of these measures won’t be applicable in the immediate wake of COVID-19, e.g. interest rate falls. That said, when markets return to normalcy, this list of drivers will be applicable.
For upgraders, interest rate reductions have been a keen driver of markets. The ability to draw on built up equity and borrow at a competitive rate has prompted many to act in the past. Of course, with rates being used as a lever to stimulate the economy at the moment, their ability to substantially drive the upgrader sector post- COVID-19 will be some time off, the report noted.
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Empty nesters who’d been looking to downsize and move closer to the city were, in the past, driven by the improvement of lifestyle factors. This would include the development or upgrade of community- centric hubs such as cafés and restaurants. 
Those who are self-funded can also be prompted to move in response to available property types – in particular high-end apartment accommodation – where they can enjoy a comfortable, low- maintenance lifestyle with the ability to lock-and- leave for travel. Again, elements that may be some way off after the crisis passes and we’re on the road to recovery.
"Local drivers by property type aren’t particular to Brisbane. What traditionally applies here could well apply to most capitals on the eastern seaboard," the valuation firm said. 
For units, the influence of oversupply and undersupply is paramount. Brisbane saw the fallout of new build oversupply during 2017 to 2019 as off-the-plan product came to completion.
 Many revaluations were coming in below the original purchase price. 
"During 2019, we were seeing a pick- up in absorption of this oversupply, but the post- 2020 market is more uncertain at this stage," the valuation firm said. 
The thing to keep in mind regarding apartments is that good quality stock which appeals to owner- occupiers is often well received, the report added. 
It’s this type of unit that will receive increased buyer interest post-2020. This includes units of good size and with a practical floorplan within close proximity of desirable hot spots. 
In comparison, typical investor style apartments in secondary locations will have less growth potential.
A two bedroom apartment situated in the Brisbane CBD was sold for $477,000 in April.
The 145sqm apartment at <a href="https://www.realestate.com.au/sold/property-apartment-qld-brisbane+city-127595854" target="_blank">405/108 Albert Street </a>(pictured below) features a large fully enclosed courtyard with lush surroundings. 
The home comprises two bedrooms, two bathrooms, modern kitchen, secure car park and storage cage. 
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Similarly, townhouses within the inner city have performed well in comparison to those positioned in outer-lying suburbs. That said, performance can be project specific.
Broadly speaking, well located, quality townhouse projects catering to the owner-occupier market have performed better, with stronger demand and value levels that are more resilient.
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A current listing is a Paddington townhouse priced over $699,000.
The three bedroom, two bathroom townhouse is situated at <a href="https://www.realestate.com.au/property-townhouse-qld-paddington-133105886" target="_blank">1/23 Royal Street </a>(pictured below).
It features open plan dining, modern kitchen, living room, private courtyard and garden area. 
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And of course, detached housing is the stalwart sector. Houses closer to the city tend to retain and grow in value better than those located further on the fringe. High demand and limited stock is the equation that’s driven this traditionally, the report noted. 
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<div>Note regards COVID-19</div>
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This edition of Month In Review had its topic defined in late February with submissions from our offices collated through to late March. During this period, shifts in the social and economic landscape due to COVID-19 became increasingly dramatic, as demonstrated by the varied information provided by offices over the course of three weeks. 
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<div>This month’s residential theme on baseline property market drivers remains a common thread, and provides an indication of what influences to monitor as the property sector recovers post-crisis.</div>
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Brisbane unit market remains uncertain during COVID-19 pandemic: HTW residential 

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The Brisbane industrial property market started 2020 with a bright outlook as the favoured commercial asset class however the COVID19 pandemic has upended all previous predictions, according to the latest report from valuation firm Herron Todd White.
“Over the past two years, the industrial market experienced firming yields across prime assets supported by solid purchaser demand and the low interest rate environment, however with the outbreak of Coronavirus, the global economy is in uncertain times and there are likely to be significant impacts on the Australian property market,” said the firm in their April Month-in-Review report.
Discussions with leading industrial agents suggests that sales activity has slowed significantly, with some reporting all of their current stock being removed from the market and existing leasing negotiations being deferred for three months or ceasing all together.
Of the properties that have remained on the market, the report says that weaker buyer demand and extended selling periods have set in with some vendors even accepting softer than expected yields to incentivise would-be purchasers back to the discussion table.
The firm found that increased incentives are being offered in the form of rent free periods, however this does not yet appear to be having a noticeable affect on the drop off in transactions.
“As with the pre Coronavirus climate, the most active segment of the market will continue to be transport and logistics with tenants gravitating towards modern properties with good access to motorways,” the report found.
“The full effects of this global pandemic are still somewhat unknown, but despite this, the fundamentals that positioned the Brisbane industrial market for a strong 2020 are still there, albeit in the background.”
“Once we can all return to a somewhat normal environment, the Brisbane industrial market will no doubt be appealing based on those underlying factors of a low interest rate environment, lack of supply of quality, investment grade assets and the availability of capital,” the report concluded.
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How Brisbane’s commercial market has fared during the coronavirus pandemic: HTW

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Retail continues to be the most challenging sector of the property market in Brisbane, according to the latest report from valuation firm Herron Todd White.
“An emerging reality is that there is simply too much retail available across Brisbane to service relatively flat levels of tenant demand. The oversupply is exacerbated by the ongoing growth and sophistication of the online environment and the significant cost advantages that online retailers enjoy compared to bricks and mortar retailers,” said the firm.
The March report found that there is an increasing level of vacancy in areas previously considered as prime and a much greater level of focus on convenience, parking and exposure.
"This is causing a greater level of differentiation between prime and second tier properties which is evidenced in both rents and yields. Issues such as decreasing availability of parking, the growth of delivery services and the higher costs of living generally have eaten into the profitability of a number of café precincts in the inner suburbs of Brisbane," they said. 
Previously strong locations such as Bulimba, Nundah, Portside, Given Terrace, Racecourse Road, Park Road, Stones Corner, Coorparoo and Windsor in particular are seeing higher levels of vacancy and increasing levels of tenant turnover.
For some of these precincts, recovery is likely to take many years. On the investment front, buyers are increasingly aware of the retail headwinds and have become increasingly cautious.
They are more closely examining lease covenants, lettability and sustainability of rent levels before committing to purchase.
Coupled with this, the inability to replace strong retail assets is leading to a diminishing supply of good quality stock for sale and lower levels of sales accordingly.
As a result of this caution there is a clear divergence in yields emerging between good quality, well leased property and those with greater cash flow uncertainty.
For prime sub $5 million investment properties, yields have continued to tighten whilst yields for second tier properties are stagnant at best. For strong convenience retail properties, yields are generally in the 6% to 7% range but may achieve under 6% for strong well leased inner-city properties.
Good quality neighbourhood centres anchored by Coles and Woolworths are highly sought after with investment yields holding in the 5.75% to 6.75% range.
These centres are considered to be reasonably recession and future- proof. For sub-regional shopping centres, there are more sellers than buyers at the present time and markets are continuing to soften.
"The exposure of these centres to fashion and discretionary retailers is a significant drag on rents and saleability, however these market conditions open up opportunities and there are private investors scouring the market for opportunities to purchase and value add," the report found. 
There is however still the potential for ongoing diminution in rent levels for existing tenancies, and buyers are very cautious. Yields for these centres are showing a wide range and now touching over 8% for second tier properties.
In the CBD retail markets, conditions remain soft albeit that there is long term optimism in the market due to the major infrastructure projects underway.
Rents across all retail classes are stagnant at best and incentives are increasing, particularly where there is significant vacancy. The headwinds in retail are likely to be long term, with the likelihood of further pain.
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Brisbane retail continues to struggle: HTW Commercial

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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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