Property demand subdued

PROPERTY Residential

While demand for property in Brisbane remains subdued, pent-up demand for rentals could spark a surge in investor sales, says a leading property researcher.

Josh Brown, PRDnationwide research analyst, said: “Looking forward, investors capable of purchasing a well-placed property will begin to enjoy stronger yields.” The PRDnationwide Brisbane Highlight Report says it is likely that the property market will remain stable at least for the remainder of 2011 with provisions for further gradual price corrections.
Mr Brown said Brisbane had a slow year for property price growth in 2010, at 3.6 per cent, while sales activity had dropped to its lowest level in a decade. “The median house price is up $18,705 to reach $538,705,” he said.
“The cost of renting a three bedroom house in Brisbane has increased three per cent.
“This figure is in lieu of the low level of active buyers in the housing market and the high number of displaced residents following the January floods.” The volume of house sales was down 28 per cent.
“Settled transactions over the most recent period have softened considerably from the incentive driven half year ending December 2009 to register 6,456 sales.
The precinct to record the highest price growth throughout Brisbane was the Western precinct at 4.5 per cent (a gain of $25,000).
“The median price for Brisbane’s West Precinct has not only registered a price peak of $585,000 – it also recorded the highest median price for all precincts excluding Brisbane’s inner precincts,” Mr Brown said.
PRDnationwide also examined the Brisbane apartment market – interestingly unit prices are up slightly more than house prices at 3.8 per cent.
“Settled unit transactions have tightened significantly over the most recent December half year period to register 2,535, equating to a softening of 39 per cent (1,625 sales),” Mr Brown said.
“This not only represents the lowest level of sales activity in over 10 years, but also 1,345 transactions below the 10-year average of 3,880 sales per six month period.”