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A local buyer’s agent has provided key insight on what opportunities the Brisbane property market is presenting to investors.
Speaking to SPI, Melinda Jennison of Streamline Property Buyers explained why now is an exciting time for property investors in Brisbane.
“As the third largest capital city in Australia, Brisbane is the economic engine for Queensland as a whole,” Ms Jennison said.
“Over recent years we have experienced an apartment oversupply in the inner city ring suburbs which has definitely had an impact on investor returns in terms of capital growth and rental yield in that market. The run-off effect was that vacancy rates in inner ring suburbs started to increase which resulted in negative rental price growth.
“The middle ring and outer suburbs were less effected. But more recently construction commencements have slowed right down and we are now facing a period in the immediate future of potential undersupply which is likely to put upward pressure on prices.”
Further, Ms Jennison said the team is already seeing vacancy rates drop sharply. She noted that rental price growth has also been consistent for a few months.
“The immediate future looks very bright for investors considering we have population growth that is accelerating and a record volume of infrastructure projects underway which will help stabilise the local economy in the years ahead,” Ms Jennison said.
“That said, the housing market in Brisbane has been performing strongly in some suburbs – even in light of the fact that the median price growth for Brisbane houses over the last 12 months has shown a relatively flat market.
“We have been purchasing properties for clients in suburbs that have shown consistent year-on-year price growth upward of 5 per cent per annum for the last five years. It all comes down to local drivers of supply and demand and understanding, at a local level, what is happening in the Brisbane property market. “
“Our investment yields are also a lot more attractive, which is another reason interstate buyers are heading north,” she added.
“Brisbane also has all of the fundamental drivers of solid price growth in place and there are many large research groups including QBE Housing Market Outlook and BIS Oxford Economics who are predicting very good capital growth – up to 20 per cent across the next three years – in Brisbane.”
Ms Jennison expects more interstate investor activity in the months ahead “as property investors start to see price rises in Brisbane (hopefully) and then, as often happens, a lot more people will move in once the upward price growth trend is established”.
“But more so than this, I think a lot of people have much better access to funding since the APRA changes came into effect and we have also seen two interest rate cuts (with more to come) so there is certainly more confidence in property markets as a whole,” she said.
Streamline Property Buyers was launched by Melinda and Scott Jennison just over 12 months ago.
During this time, Ms Jennison says one of the biggest obstacles they’ve seen clients face is maintaining a strategy when it comes to their property portfolio.
“We are finding that a lot of clients are quite confused when we speak to them about what property investment strategy is going to be right for them,” she explained.
“There is so much information and so much ‘noise’ about different investment strategies on offer today. Capital Growth, cash flow, flip, manufacture equity, development.... for the average investor a lot of this information can be overwhelming.
“Part of our service is that every client gets a one-on-one strategy session with a Qualified Property Investment Advisor (QPIA) so we can help clarify what type of strategy might be best suited to an individual investor’s personal circumstances.
“Because we are all different in terms of our goals, our risk appetite, our incomes and our lifestyles, it is important to understand what investment strategy might be best suited to the individual and not take a ‘one-size-fits-all’ approach.
“Also, for those looking for a more sophisticated strategy to manufacture equity or complete a development project, we have the team that can assist with the whole process from concept to completion. So our service is usually tailored to the needs of our clients. “
It is this service capability which was one of the reasons why the Jennison’s decided to roll out Streamline Property Buyers to the Brisbane market.
“Scott and I have been involved in Brisbane property for more than 20 years as investors, builders and property developers. We wanted to create a boutique service offering where we could guide buyers who may not have the same intricate knowledge of our local property markets,” Ms Jennison said.
“Brisbane property is very different to Sydney and Melbourne in terms of land constraints (eg flooding) and our architecture (largely tin and timber homes). Therefore it is important for property investors to understand how these differences can impact on the performance of an asset.
“While property investing is largely related to selecting the right location for the relevant investment strategy, our business was created on the foundation of helping others not only select investment grade locations in Brisbane based on the numbers and our local knowledge, but also to ensure people avoid costly mistakes and to provide complete transparency around the asset that they are looking to buy.”
Another reason was to fill a knowledge gap that a lot of people have during the home buying process.
“During a project where I was managing a small townhouse development for a client, I reached out to the adjoining property owner to discuss the dividing fence. During my discussions, she told me that they had just moved in to the property only weeks before we demolished the single house next door and started to construct three townhouses in its place. She was devastated and had no idea she would be living next door to three neighbours instead of just one,” Ms Jennison said.
“It made me realise that most people would not understand what land zoning means, how to find approved developments in an area, what areas will change due to development or planned infrastructure in the future – among other things.
“It was a light bulb moment where I realised the skills Scott and I had could really benefit property buyers throughout Brisbane.”
For Ms Jennison, Streamline Property Buyers primary goal is to “select the best possible property for our clients every time, one that we know will not cause headaches down the track but will deliver the desired results that a client is looking to achieve.”.
“We also want to enable our clients to become more confident property investors following their experience with us,” she added.
“We achieve this through our unique service offering. Every client gets access to every team member throughout their journey with us. We don’t just take over the process, we help people to understand the reasons why a property may or may not be a good investment for a particular strategy.
“When we achieve this, our clients become raving fans and this is how we build our brand and our business into the future.”