5 things you thought you knew about the Brisbane apartment market

Anthony Hancock
Anthony Hancock

Brisbane’s apartment market has been a hot topic among property enthusiasts for some time now. But what’s really going on in 2018? Let’s bust some of the myths surrounding the city’s alleged challenges, and what it really means for the future of the market.

Prices are improving

Despite all the media hype around Brisbane apartment supply last year, research shows that ironically the areas of greatest concern such as the CBD and South Brisbane saw renewed growth in median prices in 2017 after a fall in 2015 and 2016. The local market is showing more signs of improvement in 2018, and the future is looking positive.

brisbane apartment oversupply

After period of uncertainty, Brisbane apartment market is showing great promise.

Rental rates aren’t suffering

Paul Riga from Urbis has identified that rental yields in Brisbane are sitting at a healthy 4.5 per cent – well above Sydney’s 3.8 and Melbourne’s 4.0. This is great news for the short- and medium-term strength of the rental market.

Vacancy rates are sitting healthy

According to REIQ, a vacancy rate of 2.5 to 3.5% is considered to be a balanced and healthy market. Currently Inner Brisbane’s vacancy rate is sitting at 3.9%, with greater Brisbane a healthy 3%. Certain middle ring suburbs such as Upper Mount Gravatt are showing even greater strength with vacancies at 2.7%.

It’s a great time to invest

The truth for investors is that genuine, appealing investment opportunities still exist in Brisbane. However, these opportunities are highly dependent upon location, product mix and value / quality offering.  Meanwhile, in under-supplied Brisbane locations, there is a huge demand for larger, high-quality apartments. Which means that if you’re interested in investing, the prospects are looking great!

Arc Mosaic Auchenflower

Arc by Mosaic at Achenflower is a great example of the boutique, high quality apartments that are in demand around Brisbane.

Oversupply is a complex concept

Okay, okay. Some numbers may show that there has been an existing oversupply for particular Brisbane apartment stock. However, it’s a little more complex than that. The oversupply has been concentrated in specific markets, and data reflects that it’s actually likely to be absorbed by the market by the end of next year. To best understand, pay attention to research that differentiates between “paper supply” and “realistic supply” – which you can read more about here.

So, what?

The thing is, research from multiple studies and sources shows that not only are things not as dire in Brisbane as some might have you think, but the city is well placed to take over as the best performing capital city housing market over the next five years.

Check out the video below for our detailed analysis of Brisbane’s apartment market, and download our eBook for more information.