Australia’s massive infrastructure boom is putting property investors in prime position

Let's look at how Australia's infrastructure boom will underpin property prices in the years to come

Queensland

The 2023 Federal Budget is injecting $3.4 billion over the next 10 years in the lead up to the 2032 Olympic Games, including $2.5 billion on the Brisbane Arena, and $935 million on 16 other new or upgraded venues. With an overall total of more than $20+ billion being spend in Queensland on upcoming infrastructure.

A major upgrade of the Bruce Highway through Brisbane’s outer northern suburbs is also slated, and this will provide safer and more efficient travel for those living in this area. As for the Ipswich Motorway, funding has been allocated to complete detailed planning works for its next stage. This much-needed investment will not only improve infrastructure but also support job growth. And just when you thought it couldn’t get any better, the CBD’s new home of entertainment, Brisbane Live, is set to further enhance the local economy by bringing in more tourism. The Queen’s Wharf resort development also promises to become a waterfront paradise, complete with hotels, apartments, restaurants, and a casino.

The increased construction activity in Brisbane, as well as improved access to the city, will no doubt be driving more people to rent and buy properties. House prices have already been increasing in the region, which could be an indication of what is to come. In fact, Corelogic’s daily home value index shows Brisbane house prices increased 0.1% last month. This uptick in property prices could be the start of a trend, and investors looking to capitalise on Brisbane’s growing population and improved infrastructure would be well advised to begin looking for investment properties in the city.

New South Wales

With a new State leader at the helm and a commitment to invest in critical infrastructure, the NSW State Government is committing more than $107 billion over the four years to 2023 for infrastructure projects across the state. Of particular note is the WestConnex motorway, which is set to bridge the gap between Eastern, Western, and South-Western Sydney, the Inland Rail that will connect regional hubs to the rail line, and the regional hospital redevelopment projects that are underway in several key areas. The state government is also investing in public transport and schools, as well as in roadworks designed to improve safety and reduce traffic congestion.

Sydney is set to benefit from improved infrastructure in a big way. In addition to a better lifestyle for residents, the city’s population growth and infrastructural improvements could give investors the perfect opportunity to capitalise on increased property demand.

According to the latest data, median house prices within Sydney’s most sought-after suburbs were up 2.0% in March, despite the recent economic downturn. The current record low vacancy rates combined with the city’s growing population show the strength of the property market. Property prices should continue to rise in the near future, making it a great time for investors to start looking at investment opportunities.

Victoria

Over the next four years, the state is set to invest a whopping $100+ billion into various infrastructure projects. Major projects slated for Melbourne include the building of the Melbourne Metro Tunnel as well as the Melbourne Southeast International Airport. It’s a clear sign that the Victorian Government is looking towards the future of both tourism and business within the city.

But the good news doesn’t stop there – Geelong is set to reap the benefits of the Geelong Fast Rail, Geelong Convention and Exhibition Centre, and Barwon Women’s and Children’s Hospital.

Victoria is another state that is spending big on infrastructure, and the fact that Melbourne has recently overtaken Sydney as Australia’s most populous city is an indication of just how healthy the Victorian economy is.

Corelogic’s home value index shows Melbourne house prices were up 0.1% in April 2023. This is a sign of the rising demand for housing in the city, and investors looking to capitalise on this trend should take advantage of Melbourne’s current market conditions.

Perth

The Perth State Government has unveiled its $39 billion investment in infrastructure over the next four years. This bold initiative encompasses a wide range of vital projects, including new and expanded hospitals, additional schools, the transformative METRONET program, and major investments in road, port, and electricity infrastructure.

The investment in road infrastructure will enhance connectivity within the state and improve transportation networks. This can lead to increased accessibility to various areas, making properties more desirable for residents. Improved connectivity can also positively impact property values and attract more potential tenants.

As these infrastructure projects progress, they will generate job opportunities that lead to a rise in population. This will help create increased demand for housing and rental properties. Property investors can benefit from this demand by capitalising on improved rental yields or potential appreciation in property values.

A 0.6% increase in property prices in April 2023, as indicated by CoreLogic’s home value index, suggests a positive trend in the market. The increase in property prices can be seen as a sign of renewed confidence among buyers and investors in the Perth market. Factors such as the overall economic conditions, employment opportunities, and upcoming infrastructure developments are likely big contributors to this upward trend.

Final thoughts

The potential for a significant increase in capital gains and rental income is certainly an exciting prospect for investors. With billions of dollars being invested in various infrastructure projects across Australia, there is no doubt that the country’s economy will benefit as a result.

History has shown time and time again that the addition of new amenities, such as social and retail outlets, can lead to a rise in demand for rental property in the surrounding area. Real estate investors are right to be excited. Looking toward the future, Australia’s infrastructure spending could provide the perfect opportunity for investors to capitalise on a potential increase in demand.

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Our team is here to provide you with the latest property investment advice backed by research. With our one-on-one mentorship, workshops, and ongoing education, we are confident in helping you build a strong and profitable portfolio.

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