Property experts believe that while the property market in Brisbane has shown solid growth this year, apartments remain fantastic value for investors. With increasing numbers of developments in the planning process and being built, higher population levels expected and steady capital growth predicted for inner city areas of Brisbane for 2015, investors should keep an eye out for opportunities in this vibrant city.
The median house price in Brisbane increased by almost 5% from 2013 to 2014, and according to SQM Research managing director Louis Christopher capital growth in inner city areas was expected to reach between 5% and 8%. The median price for apartments in and around the CBD had dropped slightly during the last quarter to $357,466. This reflected the increasing numbers of units coming onto the market during this period. Interestingly, according to Fairfax’s Australian Property Monitors, the yields on apartments in Brisbane remained higher than all the other eastern capital cities at 5.27%.
Rental demand also remained strong for investment property in Brisbane, although it was mainly concentrated in areas near the CBD and particularly suburbs such as Fortitude Valley where many people had opted to live close to where they worked. Brand new developments were coming onto the market in these locations and being quickly snapped up by investors, with potential tenants signing up for apartments straight away (in some cases without even viewing the properties first).
The key to a successful strategy for property investment in Brisbane is to:
- Focus on inner city locations that will keep attracting high levels of rental demand. Suburbs such as Newstead are close to transport and major infrastructure as well as employment hubs. Fortitude Valley and South Brisbane will also always be popular for high value professional tenants because of their proximity to the city’s CBD, entertainment, shopping and transport.
- Choose quality developments and off the plan properties that will hold their value over time. Architect designed developments will always remain more prestigious then general residential buildings.
- Pick apartments that are low maintenance (and therefore cheaper to keep over the long term) but still provide all the “mod cons” that tenants look for, including open plan layouts and designer kitchens and bathrooms.
While the focus of many property investors remains on the higher performing cities of Sydney and Melbourne, experts suggest that as part of a long term strategy investment property in Brisbane may offer good value for money as well as stable 10 to 15 year capital returns. When looking at a property market – especially if you are not overly familiar with the local market conditions or investment property outlook – it is important to talk to experts such as Ironfish. They have local knowledge and expertise in investment property in Brisbane to assist you in creating a suitable long-term strategy as well as finding you the right property for your investment needs.