Why are Brisbane property prices going up by so much during a pandemic?
A perfect storm of low stock, even lower interest rates, wage growth and a global pandemic have catapulted Brisbane’s typically slow-moving property market into the stratosphere, sparking a once-in-a-decade boom that experts say could fuel a further 10 per cent rise in house prices in the coming year.
While detached property prices rose in every capital city except Darwin and Perth over the January quarter, according to figures released by Domain, the almost magical mix swelling Brisbane’s usually stable market has been brewing for two years, says Brisbane-based market analyst and owner of Propertyology, Simon Pressley, with the red-hot industry showing no signs of slowing.
“All of Australia without exception – in every single location – is strong and it’s the first time the country has seen this for about 18 years,” Mr Pressley said.
“So, it’s a case of rising tides lifting all ships – but not everyone is rowing in the same boat.
“We had a series of events for a couple of years before COVID that meant progressively there was less and less resale stock (here in Brisbane), and it was getting tighter and tighter. Then in the six months leading up to COVID, we had auction clearance rates through the roof, prices rising primarily because we had not enough supply for sale and not enough rental supply and then we had four interest rates cuts.
“And that was all before COVID.”
Auction clearance rates are up significantly compared with the same time last year. Photo: Tammy Law
But while the stars were aligning for a Brisbane property boom well before the pandemic struck, Mr Pressley said the virus further fuelled the fire as Melbourne and Sydney bore the brunt of the nation’s coronavirus chaos.
Article by SARAH WEBB