Positive Property Prospects in Australia’s Queensland

Queensland saw something of a property boom in 2007 – against all the odds – and despite the fact the global economic slowdown is of course affecting the Australian economy and housing market, certain property professionals believe Queensland’s main centres could again deliver strong growth in 2008.

Well, according to Peter McGrath from the Real Estate Institute of Queensland, prices could be expected to rise by between 5 and 10 percent in Brisbane and between 4 and 6 percent on the Gold Coast.  But because 2007 saw such exceptional gains (up to 16.3 percent in certain areas of Brisbane according to the latest Real Estate Institute of Queensland figures), investors should not get to lax and lazy about doing research into which properties to buy.

It is no longer a case of any property being undervalued and therefore witnessing a period of price appreciation, rather only the most well located properties in and around Brisbane will remain in strong demand as rental stock and therefore return the attractive yields most investors are looking for.

Also, investors need to be aware that they should be thinking longer term about any property they purchase in Australia right now.  This is because, despite the fact there is a shortage of housing units in Queensland to meet current demand for example, there is a restriction on affordability in the market and this is likely to get worse.

So, yes, as stated there is a deficit in terms of supply according to the figures from the Housing Industry Association Queensland; they estimate that there is a requirement for 50,000 new units in 2008 and that only 44,000 are expected to come to the market.  But the migration patterns that fuelled the 2007 boom are easing off now that a lot of jobs in the booming mineral industry have been filled.

So, we have a situation where there is a deficit in terms of supply and a definite level of demand which will result in a positive situation for property prices in Queensland according to many commentators, but there is also the fact that affluence in the market is likely to be squeezed and prices are reaching their maximum in terms of what the market can support.  So, if an investor buys well located stock in the likes of Brisbane, a rental strategy could prove profitable, but anyone looking to buy in cheap and realise attractive gains over the short term could be very disappointed.

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