Brisbane’s property market has been slow and steady, with dwelling prices rising 1.1% for the 3 months to December 2019, or 0.4% per month according to Tim Lawless of CoreLogic. The property market in Brisbane is set for a strong start in 2020 thanks to a few major projects like Queens Wharf (the new casino), Howard Smith Wharves and very strong housing affordability compared to Sydney and Melbourne.

Brisbane’s property market is much more affordable than Sydney and Melbourne. According to research by Michael Matusik the current price to income ratio required to buy in Brisbane is 5.3 times at a median house price of $524,000. This compares very favourably to Sydney at 10.8 times income with a median of $1,165,000, and Melbourne at 8.4 times income with a median house price of $829,000.

(Source: CoreLogic/Hunter Galloway Mortgage & Loan Brokers/Matusik Property Insights)

SQM Research’s Housing Boom and Bust Report for 2020 forecasts an increase in home prices in the Queensland capital of between 3% - 7% — a recovery from the sluggish growth recorded in the first half of 2019. The base case scenario forecast assumes no changes in interest rates and no intervention by the Australian Prudential Regulation Authority (APRA), in which case SQM predicts Brisbane home prices would increase between 3% - 6%. In the best case scenario for Brisbane, prices are forecast to rise between 4% - 7% if interest rates are cut to 0.5% by April 2020. The worst case would be if interest rates are cut to zero, which SQM predicts would trigger price falls.

SQM Research managing director Louis Christopher said Brisbane’s improving economic outlook and recovery in mining investment was set to benefit the housing market. “An increase in mining investment is going to be a good job creator for the city,” Mr Christopher said. “Brisbane is definitely offering better value for money for those who decide to move from Sydney to Melbourne. The problem in the past has been people will come from the south but struggle to get jobs, but the economy is picking up and I think there will be more white collar jobs on offer in Brisbane over 2020 and 2021, which may well encourage more buyers from down south.” Mr Christopher said he also anticipated a recovery in Brisbane’s rental market in 2020, with rents forecast to increase between 3% - 5%.

(Source: SQM Research)