This Week in Real Estate – 12th February 2022
Brisbane Unit Market Selling Faster
Brisbane unit prices are rising, with PRD Research revealing the inner ring median unit price has now hit $530,000.
The median unit price in the middle ring is now $467,000 and the outer ring is still a very affordable $397,000.
The research says while the outer ring is affordable, particularly for first-home buyers, it is also the fastest growing.
In the past five years median unit prices in the inner ring (0-5km from the city) have increased 6%, 3.1% in the middle ring (5-10km from the city) and 6.4% in the outer ring (10-20km from the city).
The research showed that units in all areas of Brisbane were selling for more than the original asking price. “There is a revival in the unit market after a period of price discounting in mid-2020,” it says.
The report also found the number of days it took to sell a unit had dropped in recent months. “The Brisbane unit market is moving faster again,” it says.
Gold Coast Market Still Pumping
The Gold Coast property market is tipped to continue to perform well in 2022.
Harcourts Coastal director Dane Atherton says the Gold Coast is still a seller’s market, while Andrew Bell of Ray White Surfers Paradise says property sales are still high, with high end houses and units continuing to change hands.
The region is on track for price growth of 11% this year. Bell says prices won’t increase as much as they did in 2021 but will still perform well, helped by a significant under-supply of property.
“This will be a good year for property but the best of the boom years has passed,” Bell says.
“You just cannot have exponential growth year after year so I think 2022 will be a more modest year but this would be really healthy for the market.”
Research from Knight Frank shows 216 Gold Coast properties in the $2 million to $7 million range sold in the third quarter of 2021, with five sales above $7million.
Auction Results Continue To Ramp Up
Sellers continue to take advantage of hot auction markets with smaller capital cities leading the charge.
Last weekend 1,786 homes went under the hammer, which was more than 50% higher than the previous weekend. Despite the increase in listings, clearance rates improved further in most cities.
Of the 1,427 results collected, 74% of properties sold, according to CoreLogic director of research Tim Lawless. He says volumes and clearance rates exceeded expectations for the first few weeks of 2022.
“We’ve seen volumes tracking more than 30% higher than the same time last year, especially across the smaller capitals,” Lawless says. “And this really highlights the trend towards strength in the market in the smaller capitals.”
Adelaide had the highest clearance rate of 90%, followed by Canberra on 85%, then Sydney 77% and Melbourne 75%.
Brisbane (57%) had its lowest clearance rate since January 2021 as a result of a large number of homes being withdrawn following major storms on the weekend.
Buyers Pay More For A Swimming Pool
Demand for backyard swimming pools has jumped 55% since the start of the pandemic.
Swimming Pool and Spa Association of Australia chief executive Lindsay McGrath says demand has risen in every state and territory.
Pool and swimming pool are the most searched terms on realestate.com.au, with buyers entering those key words seven times more often than the next most popular feature, a garage.
Frank Valentic of Advantage Property Consulting says that buyers will pay a premium of between 10% and 20% for a house with a pool.
He says pools haven’t always been in big demand but they were undergoing a resurgence with home buyers.
“Previously, some might have seen it as a negative rather than a positive,” Valentic says. “But I’ve not had one person say anything like that since Covid, because there’s been a massive lifestyle shift.”
Valentic says owners shouldn’t install a pool just to add value to their property, but do it for their own enjoyment.
RBA: No Rate Increase Imminent
Despite constant media speculation about interest rate rises, the head of the Reserve Bank has yet again reiterated that wages need to increase before the cash rate does.
RBA Governor Philip Lowe says underlying inflation has not yet reached a point that necessitates a rate increase.
The RBA has lifted its near-term inflation outlook, but Lowe says it can afford to wait for a wages increase before moving the official rate.
He expects the economy to bounce back strongly in the coming months as Australia’s unemployment rate looks to drop below 4%.
Commonwealth Bank economist Gareth Aird says the RBA’s upgraded outlook on inflation and unemployment, released on Tuesday, suggested it was on the cusp of normalising the cash rate, but Lowe’s comments on Wednesday pushed against that notion.
“The RBA’s central scenario puts inflation sustainably in the target range, but the Governor has said that it’s too early to conclude the forecasts will be achieved,” Aird says.
