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2022-02-25 Property Tips

Best Suburbs to Invest in Brisbane in 2022

Brisbane’s red hot real estate market is forecast to continue its winning streak in 2022, but the question at the forefront of buyers’ minds is which suburbs are ripe for investment?

CoreLogic’s latest Hedonic Home Value Index, released on February 1, shows the Brisbane property market has gone gangbusters in the past year, recording a mind-blowing 29.1% growth to make it the best performing capital city in Australia.

The figure is well above the national growth of 22.4%, which was the highest annual growth rate since June 1989.

Rental yields have followed suit, with a 2.3% boost across Brisbane, making it the equal top Australian city (along with Canberra) for the fastest rise in rents, largely due to the imbalance between rental supply and demand.

Rents for houses have risen 11.6% in the past 12-month period, while units were more subdued with a 6.7% increase.

The Real Estate Institute of Queensland says the record vacancy rate is putting added pressure on markets, amid the impacts of the COVID-19 pandemic.

At the same time, the increased demand for Brisbane property has been reinforced by increasing consumer sentiment, historically low-interest rates, and internal migration considering the relative affordability of houses in Queensland compared to Sydney and Melbourne.

REA Group’s executive manager – economic research, Cameron Kusher, has forecast Brisbane dwelling prices will increase between 8 and 11% this calendar year.

So, here’s six Brisbane suburbs to watch if you’re pondering the possibility of making an investment this year.

Narangba

Located 34km north of the Brisbane CBD in the Moreton Bay region, Narangba has become a haven for families with a residential renaissance from its rural roots.

Satterley’s Ridgeview community is a favourite amongst families, with a 5000sqm central park, playgrounds and outdoor gym equipment; and close proximity Narangba train station.

As one of the fastest growing suburbs, Naranga has also been earmarked as part of a local development urban growth corridor under the South East Queensland Regional Plan 2009-2031, which will see greater local infrastructure.

Data from realestate.com.au shows Narangba has experienced 7.3% compound growth for houses and 6% for units over the past five years. Median property values now range from $640,000 for houses to $399,900 for units.

On the investment front, rental returns have gathered momentum in recent years. Houses are generally tenanted for $460 a week with an annual rent yield of 3.7%, while units lease for $410 a week with a rental yield of 5.3%.

Chermside West

In recent years, Chermside West has gentrified and is now a very real competitor to its neighbour, Chermside.

Just 10km from Brisbane, Chermside West is an attractive investment proposition with its close proximity to retail and business hubs as well as Westfield Chermside shopping centre.

The suburb also hosts the Chermside Hills Reserves, which span more than 129ha of parklands, nature reserves as well as walking and bike trails; and is the catchment for the desirable Craigslea School.

Research data from realestate.com.au shows Chermside West has seen compound growth of 7.7% for houses over the past five years., yet the unit market dipped 2.2%. Median property prices over the last year range from $811,250 for houses to $532,500 for units.

As an investment proposition, houses in Chermside West rent for $520 a week with an annual rental yield of 3.3% and units rent for around $520 a week with a rental yield of 5.1%.

Ripley

Ripley, 43km south-west of Brisbane and just 6km from Ipswich, is part of the city’s western growth expansion and is set to become one of Australia’s biggest urban growth areas.

The Queensland Government expects Ripley’s population to see a boost of more than 120,000 with plans for an additional 50,000 residential dwellings to the town.

This includes Satterley’s Ripley Valley masterplanned community, which has its first stage of the $1.5 billion development open just two minutes’ drive from the Ripley Town Centre.

In addition, the Ripley Valley Priority Development Area is offering opportunities for residential growth and is largely favoured by first homeowners and young families.

Data from realestate.com.au shows house prices have been tracking upwards in the past year from a median price of $391,200 in February 2021 to $475,000 in February this year. Median weekly rents are sitting at $420.

Cannon Hill

With a reputation as being ‘value for money’, Cannon Hill, 10km east of Brisbane, has proven popular with young families as a place to call home as well as an investment opportunity.

With its close proximity to the Gateway Motorway and Brisbane Airport and reputation as an easily accessible, central location it’s easy to see why it’s piquing interest with buyers.

Realestate.com.au figures show median property prices over the last year range from $1.08 million for houses and $466,000 for units.

The market is also a lucrative earner for investors with houses renting for $563 a week with an annual rental yield of 2.7% and units for $450 with a rental yield of $5.0%.

Based on five years of sales, Cannon Hill has seen a compound growth rate of 8% for houses and 0.5% for units, realestate.com.au says.

Smithfield

Further afield, the suburb of Smithfield near Cairns is drawing attention for its affordable housing, with more and more people realising its allure.

The suburb is home to Satterley’s Smithfield Village, just 15km from the centre of Cairns and short drives to idyllic Palm Cove and Trinity Beach. It has established public transport, a campus of James Cook University, retail and major infrastructure projects, including the newly opened $164 million Smithfield Bypass-Captain Cook Highway.

According to realestate.com.au, median property prices in the past year range from $500,000 for houses to $249,500 for units.

The suburb of Smithfield has experienced a vacancy rate of under 1% for over 12 months, making it an attractive rental investment. Overall, Smithfield houses rent for $513 a week with an annual rental yield of 5.3%, while units rent for $395 a week with a rental yield of 8.2%.

Based on five years of sales, Smithfield has seen a compound growth rate of 3.8% for houses and 1.2% for units, data from realesate.com.au shows.

Nundah

Popular with first homebuyers, Nundah, near Chermside, is an affordable and commutable location that has slowly gentrified over the past decade or so.

The suburb, favoured by young singles in the 20-39 age bracket, is a melting pot of largely mixed-density residential with some light industry and a commercial retail area on Sandgate Road.

Data from realestate.com.au shows median property prices over the last year have ranged from $950,000 for houses to $415,000 for units. Based on five years of sales, the suburb has heralded a compound growth rate of 7.8% for house, while recording a slight drop in unit values of 1.1%.

Investors looking to rent could find a profitable investment in Nundah, with houses renting for $498 a week with an annual rental yield of 2.7%, while units rent for $400 a week with a yield of 5.0%.

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