Brisbane will grow differently to Sydney

I spent last couple of hours looking at population growth patterns, employment numbers, building permits, infrastructure spends etc. in order to find some positive numbers for Brisbane.

Unfortunately, Brisbane fundamentals aren't that great in general (with some minor exceptions) but I think there's still some hope.

Sydney grew bottom-up which means good job numbers and higher incomes increased affordability in lower-medium income suburbs and that created an upgrade funnel which drove prices upwards in almost like a wave. In 2015 suburbs like Lakemba, Blacktown, surrounds of Parramatta outgrew blue chip northern parts of city in terms of value growth and that wave went through Hills District in 2016 and lower north shore is now benefitting from the increased buying power available to upgraders comprising mainly of the recent beneficiaries of price hikes.

In comparison, Brisbane is NOT likely to have a surge of newly employed/newly arrived home buyers trying to compete for lower end of the market. However, it has positive interstate migration from people who don't want to spend a million dollar on a property 45 kilometers from Sydney CBD. This already has resulted in Brisbane inner ring growing at a very decent rate in last couple of years. Some of the suburbs in the inner ring have grown around 8-10% which isn't too shabby even from Sydney standards.

There are plenty of owner-occupiers in Sydney middle ring ($1 million to $1.5 markets) who are still hoping to get into inner rings or desirable Sydney suburbs and are driving the prices up in the process. I think a few more months and another 10% growth in prime suburbs would leave a lot of people out of the race and all that money will have a good chance of finding its way to good parts of Brisbane. A top-down growth will eventually trickle down to outer fringes but top-down growth will benefit high median price suburbs a lot more than those at the lower.

So conclusion: Invest in inner ring Brisbane for next 3 years capital growth objective or if already priced out Adelaide inner ring should be the next logical choice.

 

I would generally agree..although I do think Brisbane fundamentals are improving from an average base.
I wouldn't agree with your recommendation of Adelaide in lieu of Brisbane. The two places are heading in different directions.

 

If I was buying in Brissy I would be very selective and I don't expect a boom anywhere close to what we have seen recently in Syd or Melb, because Brissy does not have the key drivers for this to happen

BTW why not Tassie?? apparently has had double digit growth and economy on the move???? Just saying, no one shoot me.


Some may be interested in this

Brisbane Property Market Outlook 2017
Extract



What is likely to perform well in the Brisbane Property Market in 2017?
With the market balanced between low interest rates on one side, and weak jobs and income growth on the other, the main driver of property price growth over the next 12 months is simple – supply and demand. So for property investors looking for return, we need to ask ourselves: where is demand likely to outstrip supply?

Demand is greater than supply for detached housing in most of Brisbane’s middle-ring suburbs, which should lead to some price growth or at worst price stability. Demand for detached housing is strongest in the following areas:

$350,000-$450,000 – Brisbane Southwest. Houses in Forest Lake, Durack and Inala are achieving strong rental returns and are affordably priced given they are under 20kms from the Brisbane CBD. The area has a fair bit of gentrification still to occur, but prices are coming off a low base and should perform above the average.

$450,000-550,000 – Brisbane Northeast. The suburbs of Arana Hills, Ferny Hills and Keperra are seeing arguably the strongest demand for property in Brisbane. Properties at the sub $500,000 price point are particularly attractive amongst first home buyers, looking to buy in this leafy pocket only 13kms from the city.

$550,000-$650,000 - Brisbane South. There are pockets of strong demand throughout Brisbane’s south, including Holland Park, Salisbury, Sunnybank Hills and Mansfield. These suburbs are well located with good schools and transport infrastructure, and are close to most of the major employment hubs of Brisbane.

 

Adelaide is a little bit more economic mess I agree and will peak a bit later than Brisbane but not a bad buy for long term hold.

Well written and fairly accurate. Where did you find it?

 

Aren't those suburbs northwest of Brisbane? Where's the info from?

 

I thought so to and I actually started a thread "Why Brisbane did not Boom", I survived that thread .... just...

Here is the link
Brisbane Property Market Outlook

 

Just attached link below for those interested