The impact of the Queensland floods was keenly felt in Brisbane over the 1st quarter of 2011 with the city recording a decline in the median house price of 1.9%.
The rest of the year was spent regaining ground in the face of tough economic conditions. The market has had to fight its way back to where it was before Mother Nature turned her attention towards us some 12 months ago. The removal of the principal place of residence stamp duty concession on 1 August was also a considerable extra burden during a year of financial hardship for many.
Early signs of change
The recent consecutive interest rate reductions by the Reserve Bank are hopefully the start of some much-needed stimulus for our market.
REIQ accredited agencies have reported strengthening activity over recent months with confidence starting to return to buyers and sellers. In particular, first home buyer activity has strengthened somewhat as prospective buyers take advantage of the soft market conditions and discounting currently available. In the September quarter, there was a 27% increase in sales below $350,000 as buyers sought out affordable property, especially in regional areas.
Regional centres near Queensland’s mining areas, particularly Gladstone, Mackay and Toowoomba, are experiencing the most robust activity. Given the continued strength of our resources sector this activity is likely to radiate out to other centres and to underpin our capital city’s market in the year ahead. Over the year ending September the Gladstone median house price increased 10.5% to $440,000.
Prior to the events of early 2011, the market had been quite steady with some green shoots of activity taking shape. With recent rate cuts driving renewed confidence, there is a good level of optimism in the market for a return to similar conditions.
Sales activity in the year ahead is likely to have a more controlled momentum than in previous boom years which will ensure our market grows in a sustainable and considered way.