After tough market conditions in 2011, many Queenslanders are wondering if and when the market will bounce back. According to the recent median data released by the Real Estate Institute of Queensland, there is now reason to believe that the last quarter of 2011 marked a turning point in Queensland’s property market.
Medians on the rise
Both the house and unit sectors are showing healthy signs of recovery, with many areas across the state posting median price increases in the December quarter. As 2011 progressed, so too did confidence levels in the Queensland property market, with prices beginning to strengthen. Many regions have seen their most robust results since prior to the floods and Cyclone Yasi that unfortunately dominated the beginning of 2011.
Over the December quarter, the median house price in Brisbane recorded a negligible fall of 0.2%, to $499,000, marking the lowest fall in Brisbane’s house price since September 2010. Unit and townhouse median prices increased 2.0% in the December quarter reaching $400,000. These healthy results indicate that Queenslanders are feeling more optimistic about the future, resulting in a positive impact on the property market.
A stand out region in the December quarter was the mining region of Gladstone, where the median house price jumped 8.6% to $478,000, a 15.6% increase over the previous year. Other areas posting median house price growth include Mackay (2.4%), Rockhampton (1.0%) and Toowoomba (4.0%). The unit and townhouse market largely mimicked the housing market, with median increases recorded for Mackay (17.4%) and Toowoomba (2.1%). Rockhampton recorded only a slight decrease of 0.7%. It is important to note that the unit market in these regions is historically much smaller than the house market, so it is more prone to median price fluctuations on a quarterly basis.
Confidence creeping back
It appears that first home buyers and investors alike are rediscovering the healthier property market. As we move into 2012, REIQ accredited agencies are reporting improved levels of enquiry, with first home buyers and investors especially taking a keen interest in the more affordable unit and townhouse market.
In addition, the number of first home buyers is on the rise, with the latest ABS figures revealing they represent approximately 20% of the market (the highest proportion for more than two years). This is likely driven by the softening of property prices over the past two years, as well as the relatively low interest rate environment, making property more affordable than it has been in recent years.
We therefore anticipate more positive news on the Queensland property market in the months ahead as the November and December rate cuts flow through our wider economy.