The natural disasters in QLD earlier this year, coupled with the higher interest rate environment, resulted in a decline in the median house price for Brisbane of 1.9% for the March quarter. As a result, the majority of Queensland is still very much a buyer’s market according to Pamela Bennet, Chairman of the Real Estate Institute of Queensland (REIQ).
But have natural disasters affected all parts of the market and what is the outlook moving forward?
Current Market Trends
The impact of the Queensland floods was keenly felt in affected Brisbane suburbs over the 1st quarter, with many suburbs not recording enough preliminary sales for a reliable median house price to be calculated.
According to the REIQ, out of about 50 Brisbane suburbs reportedly flood-affected, only 17 recorded a minimum of 10 preliminary sales to allow a median house price to be calculated.
“Many would-be sellers in these areas have wisely either taken their homes off the market – even if they were not flooded – or decided to ride out any market reaction to properties in flood-affected areas,” Ms. Bennett said.
Ms. Bennet added “While some affected Brisbane suburbs did record a drop in preliminary sales, a number of others that were partially flooded continued to record steady sales over the quarter, which is a testament to the continued desirability of living in locations such as New Farm and West End. About 75 per cent of Brisbane was not affected by the floods and these areas are continuing to record steady sales and results.”
The Gold Coast’s median house price also remained steady at $490,000 over the quarter and was also one of the few areas across the state to record a stable number of sales.
Whilst in the short term the market may remain subdued, REIQ is more optimistic about the years ahead. Ms. Bennet revealed “There is no doubt that the floods and Cyclone Yasi had a detrimental effect on the market, which had already started to soften in reaction to the interest rate rises of November as well as the poorer economic conditions overall, in this real estate cycle.
“However, the recovery process is well under way, and the multibillion-dollar investment in our State via the mining industry and a number of major infrastructure projects augurs well for the years ahead.”