Any investor will know purchasing a property involves a lot of decision making. From when to buy and where to buy, down to which type of window furnishings and which shade of paint. Deciding on the best type of investment property for your needs takes time, dedication and lots of research.
To keep this process as simple as possible, our property and research team are constantly analysing markets around Australia to find the best property investment opportunities to recommend to our customers. It’s our aim to position our investors in the right markets, with the right property, at the right time.
One market that stands out amongst the rest for long-term capital growth opportunities is the sunny QLD capital – Brisbane. According to BIS Oxford Economics, it’s looking likely to outperform the national market from 2019 – 2022.
Is there a best type of investment property? Looking for the signs…
Driven by affordability, lifestyle and demographic changes, it’s expected that more and more Australians will choose buying a townhouse or apartment over a house in coming years and Brisbane is no exception.
In the last Census, the growing shift away from detached housing towards higher density living was revealed. Townhouses accounted for 12.7% of homes in Australia, up from 9.9% in 2011 – while detached houses, though still the majority, continued their longer-term declining trajectory from 75.6.7% to 72.9%
“In the face of affordability constraints, changing lifestyle choices and an expanding Australian population, we expect townhouse living is only going to increase in popularity,” said Ironfish Head of Property, William Mitchell.
“And as more new townhouses are built to meet this growing demand, it’s likely the next Census data set will show an even stronger uptake of townhouse living.”
With demand strong and supply likely to be restricted in Brisbane, you have what experts are tipping as a “perfect storm” for investors.
Here are the top 5 reasons why experts are calling Brisbane townhouses one of the best types of investment property to buy in 2019.
A rising market
One of the markets tipped to outperform the national market over the next decade is the growing city of Brisbane. BIS Oxford Economics sees strong potential, having just released its Residential Property Prospects 2019-2022 report. They’ve predicted that the Brisbane property market will be the strongest performing market over the coming years, growing by 20%.
Changing family structures
According to the ABS, families and households are changing. The proportion of family households has been declining. In the mid-80s, families made up 77% of Australia’s households. In 2016, this figure dropped to roughly 70%. Over the same period, the number of single-person households increased from 19% to 24%. With smaller family structures, there’s less need for a big backyard, and greater demand for affordable, low-maintenance homes.
An affordable alternative
Housing prices in our capital cities can be unaffordable for most. In Sydney, housing values are 8.5 times higher than income. But in Brisbane, the ratio is only 5.9.
Typically, townhouses provide a more affordable alternative to a detached house, with more indoor and outdoor space than an apartment, but without the cost and upkeep of a larger home on a big block. It’s important to compare like for like when looking at prices, though. For example, it’s hard to compare a brand new, architecturally designed townhouse with a 40 year old house that likely needs significant repair and renovation to get it up to a level that will attract a premium tenant or buyer.
Recently, Brisbane City Council announced a proposal for a major change to their 2014 City Plan to stop the development of townhouses in low-density residential zones across Brisbane – despite continuing demand for this property type. The proposal is currently under review and expected to be implemented in mid-2020.
Many parts of Brisbane are already suffering from a lack of townhouse supply. This is clear in Brisbane’s eastern suburbs, where townhouses are in high demand. Approximately 21% of dwellings in Wynnum West are townhouses, compared to only 10% in Greater Brisbane, however in the last 2 years only 3 multi-dwelling DAs for townhouses have been approved in Wynnum West, putting this high-demand housing option in short supply.
For the growing number of families wanting a backyard without compromising their ‘lock up and leave’ lifestyle, townhouses can offer the ideal solution. They’re a low-maintenance option that still provide the backyard or entertaining space that families and professional couples seek, without the same amount of maintenance.
Ironfish is one of Australia’s largest property investment service companies. We have helped over 10,000 customers select high quality properties in great locations, with exclusive access to many ‘off-market’ properties.
To find out which townhouses we recommend in Brisbane, register your interest here.