Why rents will rise in Australia’s industrial markets across 2022
Strong demand – driven by several factors – will outpace supply in 2022 and take rents in capital city industrial m...
South-East Queensland is expected to boast capital growth of up to 10 per cent over the next 12 months on the back of several favourable trends.
According to the latest Risk & Opportunities Report of Riskwise Property Research, theState will continue to “shine” as detached houses in lifestyle areas continue to outperform dense city living.
Brisbane remains among the areas expected to draw growing interest, while the Sunshine Coast and Gold Coast continue to rack up buyer attention.
Noting a drop in stock levels, Doron Peleg, CEO of Riskwise Property Research, said these areas are likely to deliver growth of between 6 and 10 per cent over the next 12 months.
“Historically there has been a strong correlation between movements in interest rates, investor activity and property price growth, and as we forecast last year, the correlation will reassert itself this year, leading to strong price growth for houses in Brisbane, the Sunshine Coast and Gold Coast, especially for family-suitable properties” Mr Peleg said.
According to Riskwise research, investor activity, and particularly their demand for freestanding houses, is set to increase significantly in South-East Queensland.
“Beachside suburbs especially are outperforming the market. The demand for freestanding houses in coastal areas is very sustainable and is likely to continue, at a lower growth rate, over the medium and long term,” Riskwise found.
However, the researcher warned that not all markets across the Sunshine Coast are tipped to perform well, with the mining towns experiencing lower demand and presenting a higher risk due to a large proportion of investors with negative equity and insufficient growth drivers.
As for apartment appeal, Riskwise found that rental properties in high supply areas remain high risk.
“In QLD, houses are substantially preferred properties over units. Investors who buy rental apartments in high-supply areas are still taking a high risk with both equity and cash flow risk materially increasing,” the research reads.
COVID-19 is said to have further upped the risk particularly in inner Brisbane, where an increase in rental listings and large drops in rent have been recorded.
According to recent data from the Australian Bureau of Statistics, over the September quarter, Brisbane gained the most from net internal migration, with 3,200 people moving to the Sunshine State.
And the Real Estate Institute of Queensland expects this trend to continue, with chief executive Antonia Mercorella noting the interest from Victoria and NSW will swell as unique opportunities in the Sunshine State become more apparent, particularly more affordable home options.
“Freestanding houses on good-sized land within a 15-kilometre radius of Brisbane CBD will continue being hastily snapped up by those wanting proximity to the city with room to move,” she predicted.