The delay to the start of the Queensland school year has agents predicting a further surge in the Brisbane property market. The State Government announced public schools would resume on February 7 instead of January 24 to allow more time for children to be vaccinated. Real estate agent Jason Adcock says that’s fantastic news for agents with inquiries increasing, particularly as more interstate buyers are able to freely travel to Queensland if they are vaccinated. CoreLogic figures show that since 1 January Brisbane dwelling values have risen 1.1%, followed by Adelaide, which is up 1%. Sydney and Perth are up 0.5% and Melbourne 0.2%. Adcock says it is the biggest January in 20 years. “I usually don’t go back to the office until the third week of January. This year, I came back on 3 January and we had our first open houses on 5 January. We’ve had 10 open houses already and 50% of the people coming through are from Sydney or Melbourne, or expats coming back from overseas”
Locals Drawn To Gold Coast Projects
Local buyers are snapping up Gold Coast apartments with developers reporting solid interest from downsizers from Brisbane or other parts of South[1]East Queensland, rather than the southern states. New projects are coming online in response to the growing demand and developer Jim Raptis says most buyers are local owner-occupiers. “A decade ago the mix of buyers was consistent: one-third investors, one-third owner-occupants and one-third holiday-makers who would lock up their apartment for large parts of the year,” Raptis told the Weekend Australian. He says since Covid arrived up to 80% of buyers have been local empty-nesters, plus some interstate downsizers. “When people are spending more time at home, they also want more space,” he says. “Buyers are choosing to convert their third bedroom into an additional living, media or office space. That will be one of the longstanding legacies of Covid.”
Quote of the Week
“The rise in regional markets started some years ago, but the flexible work arrangements predicated by Covid, and people reassessing their lifestyle due to the pandemic, have accelerated the shift of people out of capital cities.”
PropTrack director of economic research Cameron Kusher
Vendors Make $27bil In Profits
The number of properties selling for a higher price than the owners originally paid has increased, with new figures revealing 92.4% of sellers are turning a profit. The latest CoreLogic Pain and Gain report reveals profit-making sales, at the end of 2021, increased 50 basis points on the June Quarter. The result was the highest level of profitability recorded in more than a decade, with total resale profits hitting $27.3 billion. The report coincides with the latest housing finance data from the ABS which shows the value of investor lending reached record levels at the end of last year. CoreLogic head of research Eliza Owen says the figures show that property investors throughout Australia are looking at a median profit of $270,000 when they sell. According to Maree Kilroy of BIS Oxford Economics, property prices are on the increase as investors can’t see similar opportunities in other areas such as cash and bonds
Average Borrower Is 45mths Ahead
Australians have paid an additional $50 billion in mortgage payments during the Covid pandemic, with some more than three years ahead of their repayments. Low interest rates and reduced spending because of the closed international borders and lockdowns, means many Australians have parked their extra cash in their home loans. APRA data shows that by the end of 2021 the average homeowner was 45 months in advance. That’s a big step up from the start of 2020 when homeowners were 32 months ahead. Market Economics managing director Stephen Koukoulas says the pandemic changed spending habits. “The pandemic changed a lot of things, we did tend to stay at home, didn’t get to spend our money on luxurious things like holidays,” Koukoulas says. “A lot of people decided to take advantage to pay down their mortgage.” He says many have reduced the time to pay off their mortgages by six or seven years and have a good buffer when interest rates do rise
