Brisbane-based property investors believe they have a good thing up north, spending their money on local stock, new research has shown.
An investigation by PRDnationwide, who have 130 franchise offices across Australia, has shown that the vast majority of residential property investors buying in Brisbane are locals.
According to PRDnationwide research director, Aaron Maskrey, buyers local to Brisbane bought most of the Brisbane apartments and houses sold as investments. A few Brisbane locals invested interstate, and there were even fewer investments originating overseas.
The research showed that the majority of the investor spending occurred within the inner city suburbs, with the CBD registering the most at $94.5 million.
This was followed by Newstead and New Farm, achieving $85.9 million and $42.3 million respectively. The research found while most came from inner city suburbs such as the CBD and New Farm, large numbers of investors were from outer southern suburbs such as Eight Mile Plains, Sunnybank, Calamvale and Forest Lake.
“This shows that investors are willing to spend in an outer area that may provide better yields and potential capital growth,” said Mr Maskrey.
The city centre topped the list again on the most number of sales (172) followed by Chermside (80), Doolandella (76), Newstead (75) and Coorparoo (74).
Interstate investment in Brisbane was down 30 per cent while buyers from outside Brisbane investing in the capital city dropped 27 per cent.
Mr Maskrey said although housing stock is higher priced than unit stock and typically provides a lower gross yield, when closely analysed it is determined that approximately 50 per cent of investors have purchased units to houses.
The majority of investors, who bought a free standing home, did so in the suburb of Forest Lake over the six month period ending October 2011, registering 55 house sales. This was followed by Wynnum (34), Coorparoo (33) and Bracken Ridge (32).
“Sellers looking to attract investors should consider that the majority of investors prefer to purchase ‘smartly’ within their own backyard,” Mr Maskrey said.
“Only one per cent of investor sales within the studied analysis originated outside of Australia and 86 per cent of the Australian based investors are within Queensland.
“New South Wales accounted for the second highest level of investors, at seven per cent. Brisbane investors accounted for the majority of the total investor sales, but were on the whole, evenly dispersed throughout the City.”
“Looking ahead, northern Brisbane will attract attention through a significant amount of new development in infrastructure and amenity,” he said.
PRDnationwide said the research provided a comprehensive analysis on investors purchasing within the Brisbane Local Government Area (LGA). Analysis was conducted for settled house and unit sales within the six month period ending October 2011, with a comparison to the six month period ending October 2010.