Brisbane has long been predicted to experience the property boom previously seen in Sydney and Melbourne, but is 2019 the right time for investors to flock into the Queensland capital?
Brisbane-based buyer’s agent Melinda Jennison said that sales results across the capital city largely vary on the location. Definitely, there are a lot of people buying at auctions, whether they have a pre-approval for a home loan or not.
Auctions for premium and ‘unique’ homes are also abundant across several high-end markets.
“Usually, when there’s a lot of buyer interest, it’s always taken to auction. I think that the sales agents believe they’ll get the best price by going through the auction process and it gives them a lot of publicity along the way.”
“Overall, Brisbane is a split market in terms of the types of properties that are going to auction.”
Depending on the property and its location, buyers may have to pay more in order to secure a property – a mark of strong housing demand for certain parts of Brisbane.
“It usually comes down to supply and demand. Clearly, the property should be in a good location and it should have the elements of a good property investment. The difference occurs when there are multiple offers submitted on the property.
“In that instance, you really have to communicate with your client and be clear about the fact that when there are more buyers looking for the same property, sometimes you do have to spend more to secure the property, but we will never pay at the market price.”
“It’s all about looking at comparison sales in the area because at the end of the day, if one property is not the property that we secured, there’s always another one that comes up,” Ms Jennison highlighted.
For almost a year being a buyer’s agent in Brisbane, Ms Jennison has been witness to the ‘healthy competition’ across the capital city’s real estate market.
In fact, several interstate real estate agents have been coming to the Queensland capital in order to capitalise on the abundance of buying and selling opportunities.
While there’s certainly room for everybody in the Brisbane property market today, the buyer’s agent said that local knowledge will be critical to thriving in a property market, whether in Brisbane or in other states and capital cities.
Ms Jennison said: “A bit of healthy competition never hurt anybody, but ultimately, I think local knowledge plays out. We can certainly be on the ground seeing what’s happening on a day-to-day basis while also understanding the fundamentals of what’s happening through different generations.”
“Local agents can help investors see where certain areas were 10 years ago, know what infrastructure is coming in, understand what an area will look like 10 years from now.”
“Property investment, certainly, is a long-term commitment for most people, so understanding long-term trends in property, that's what's most important.”
Apart from getting a deeper understanding of the market, local buyer’s agents can also help investors who have no time to come down to the location themselves.
Typically, agents send over videos and photos of the most viable options back to their clients, helping them make a smart decision by narrowing down all available supply to a couple of properties that meet their criteria.
“How do know when you’re bidding against an agent? It is a little bit obvious – they’re the only ones checking meter boxes and putting furniture away from walls to have a look at what’s actually really happening. A lot of DIY buyers don’t think to look for the things that buyer’s agents generally do look for.”
When buying properties, apart from looking at value-add opportunities such as potential renovation or expansion, Ms Jennison also reminded investors to think about exit strategies.
As a buyer’s agent, she makes it a point to recommend properties that not only has the fundamentals of a good investment property, but also provides multiple exit strategies to investors.
“If our buyers come to us with their own brief, we’ll follow their brief, but we’ll certainly recommend the types of properties that give them various exit strategies. We believe in understanding what the purpose of the property acquisition is at the outset, so we discuss exit strategies before we even start looking for a property for a client.”
“Something that does appeal to a lot of our buyers is that if they are purchasing a site that has multiple exit strategies, it gives them more options. After all, we don’t know where life will take us.”
Ultimately, formulating a strategy prior to acquiring investments allows investors to map out their journey, maximise possible opportunities along the way and mitigate risks.
“We always discuss strategy with our clients because it’s important to know upfront what the purpose of the investment is and to understand the timeframes that the investor has in mind. That’s all part of their goal-setting and strategy development,” Ms Jennison concluded.