With Melbourne and especially Sydney becoming increasingly less attractive to first-time investors due to skyrocketing property prices, Brisbane is shaping up as a viable alternative for those prepared to look north.
The Queensland capital has the dual appeal of comparatively low median property prices—of the capitals, only Adelaide’s and Hobart’s lower—combined with solid growth potential over the coming years.
Industry analyst BIS Shrapnel predicts Brisbane will be the only capital city market to experience any increase in house values in real terms (accounting for the rate of inflation) over the next three years, forecasting 13% growth in that period and 6% growth for its units.So which inner Brisbane suburbs—those within about 15kms of the CBD—are the most affordable to buy into? And do they offer much in terms of growth potential for your investment?
We take a look at CoreLogic RP Data’s figures to find out.
The southern suburb of Rocklea, home to the Brisbane Markets, comes in with an enticing median house price of $353,030, according to CoreLogic RP Data.
It should be noted, however, that Rocklea, which is close to the Brisbane River and one of its major tributaries, Oxley Creek, is also one of Brisbane’s most flood-prone suburbs. Its median house price plummeted almost 24% in the 12 months following the city’s 2011 floods, according to data from realestate.com.au.
Nevertheless, it’s seen solid price recovery since, with a growth rate in median house prices of 10.8% in the 12 months to 31 May, based on CoreLogic RP Data.
Rocklea also has the highest gross house rental yield—the annual income earned through a property when rented out divided by its sale price or market value—of all the top 5 most affordable suburbs, at 5%.
Keperra in Brisbane’s north-west has a median house price of $439,015.
It’s about 10kms from the CBD but is serviced by its own train station on the Ferny Grove line, and also boasts a 27-hole championship golf course, shopping centre and several parks.
Keperra residential property is a blend of post-war weatherboard and public housing along with newer developments. It’s seen solid house value growth since 2012 and a median growth rate of 8.14% in the year to 31 May, based on CoreLogic RP Data.
Tingalpa is about 11kms due east of the Brisbane CBD and, like Keperra, has some older-style post-war weatherboard and chamferboard cottages along with newer estates. It’s also within an 8km radius of Moreton Bay.
Kianawah Park is contained within Tingalpa, as is Carmichael Park, a multi-sports field venue. There’s also a state school, supermarket and family-friendly hotel. Of the five suburbs, Tingalpa has the highest percentage of couples with children as part of its overall mix of household structures.
Tingalpa’s median house price is $478,686, although its 12-month median house growth rate to 31 May was the lowest of the five suburbs at 3.37%, again by CoreLogic RP Data figures. Nevertheless, since 2011 house prices have been on a slow but steady incline in this suburb.
One stop further south along the Beenleigh train line from Rocklea is Salisbury, with a median house price of $485,570. It’s home to Russ Hall Park (also known as Salisbury Recreation Reserve), a multi-function sports and recreational space, as well as a section of the Toohey Forest Conservation Park (see Nathan, below).
Salisbury contains a blend of traditional Queenslander homes, older post-war style residences and newer developments, many of which are freestanding and on decent-sized allotments.
Of the five suburbs, Salisbury has the lowest figure for the average number of days properties take to sell from listing based on CoreLogic RP Data figures – 33 days, compared with 71 in Rocklea, the highest.
Nathan is just one suburb over from Salisbury heading east, and is home to Toohey Forest Conservation Park, the foundation campus of Griffith University and the Queensland Sports and Athletics Centre.
Its median house price is $487,265, and of the five suburbs it’s furthest away from the Brisbane CBD.
With Toohey Forest taking up much of the suburb, Nathan is relatively sparsely populated. Only 10 properties sold there in the past 12 months looking at CoreLogic RP Data numbers, compared with 129 in Tingalpa, so sales figures are less reliable.
Affordable suburbs for units
CoreLogic RP Data lists Holland Park West, Gordon Park, Kedron, Tingalpa and Moorooka as the most affordable suburbs in inner Brisbane for units. Median unit prices range from around $347,000 to around $351,000.
Capital gains for units in these suburbs over the 12 months to 31 May ranged from 3.2% in Gordon Park to 12.5% in Tingalpa. And CoreLogic RP Data reports Brisbane shares with Darwin the equal-highest gross rental yield for apartments of all the capital cities.
Queensland University of Technology (QUT) property economist, Professor Chris Eves, has raised concerns the city’s inner-city apartment market could falter next year due to oversupply.
He notes the increase in newly built apartments in the Brisbane CBD, South Brisbane and West End in particular, but suggests established (i.e. not off-the-plan) units in middle and outer inner-fringe suburbs with good schools, transport and city access—which would certainly include Tingalpa and Moorooka at least—are at less risk of oversupply.
October Real Estate Market Round Up by Allie Coutts
October Real Estate Market Update. Hello everyone, my name is Allie Coutts from Madeleine Hicks Real Estate and I’m doing the October roundup for sales that settled in October for our 4053 postcodes.
We’ll start with McDowall, there were just four properties that settled in McDowall in October and the highest of which was the one in Gielgud Street for $747,000.
For Stafford Heights, there were 7 properties that settled on October, 24 available. The highest of which was $631, 500 and that was the one in Caratel Street and $620, 000 for that property in a Mott Street. In Stafford also 7 properties settled in October, 51 available and ranged from the high $860, 000 Gamelin Circuit, round to the low was $200 for though the units have settled and for Everton Park that wins the competition, 11 properties settled in October, 92 available. The most impressive one is that large plot of land in Pullen Road which settled $1,200,000 and I learn a lot of properties in the mid-fives up to 600, 000 thousand that settled in Everton Park. So that’s our market roundup for October. I hope to speak to you next month.
For more information or to arrange an inspection please call 07 3355 6845 or visit: www.madeleinehicks.com.au
The Teneriffe Woolstore, A German Cheese Factory And Kayaks
Brisbane in the past 20 years has seen a number of urban renewal projects which have transformed near city areas including Fortitude Valley’s James Street, the Gasworks area in Newstead and the redevelopment of the Teneriffe Woolstores.
Two of the major Teneriffe woolstore redevelopments included the Mactaggarts Woolstore and the London Woolstore Apartments critically retaining the original façades and with other strict heritage controls.
Now, one of the last remaining woolstore development opportunities in the precinct has been completed with the remaining redevelopment of the upper floor of heritage 1962 The Australian Estates Company woolstore building into nine multilevel luxury residences.
The Macquarie Street Residences are the brain child of the developers Dan and Janet Williams of Ecco Developments. Architect Scott Peabody, principal of Arqus Design, was able to transform the Williams’ vision into the stunning seven two storey and two three storey luxury residences featuring commanding views across the Brisbane River and CBD skyline.
View the video file below for aerials and the property’s vision from Dan Williams.
Dan Williams takes up the tale. “We were kayaking along the river one day and looked up and saw a sign on the building that said ‘mortgagee in possession’, which immediately piqued our interest,” Williams said. “We didn’t know exactly what it was but went and had a look at it. It had then been leased as a studio by some computer game geeks.
“We thought it had great development potential, and we were able to be patient and after some negotiations eventually made a cash offer which the bank had to sit up and take notice of.
“Under the advice of our planner, ourselves and Scott thought we wouldn’t be able to take the roof off and were going forward as best as we could within the natural confines of the building as it stood. Janet and I about that time were in Germany in an old hotel outside of Stuttgart. It was an old dilapidated building about 400 years old, in fact it was an old cheese factory. We walked in the front of the building and it was like three stories of the Brisbane Hilton Hotel with an atrium running right down the middle with a glass roof over the top of the atrium. Now, you can’t have a glass roof in Brisbane with the heat and hail and such. Each hotel room had its own balcony looking out – it was an eyesore building outside, but it was stunning inside.
“We immediately said we just have to take the sawtooth roof off at Teneriffe. After a long process with council and jumping through various hoops and convincing the council planners and State heritage team, we were able to take the roof off. As a result, we now immediately had about 3000 m2 of extra floor space. We always believed it was a respectful renovation for the top of the building and one that was commercially viable. The property needed something special and spectacular to do it justice.”
Clarke Constructions were appointed builder with works beginning with major demolition of the structural roof frame and asbestos removal. A new structural building frame was completed and new roofing system to the upper levels creating two additional levels to the building.
Architect Scott Peabody who has significant heritage architecture experience including at historic Yungaba House at Kangaroo Point and Winchcombe Carson Woolstore also in Teneriffe said, “To embrace and hold on to the woolstores and transform them into a residential concept has really opened up the Brisbane River again.
“You can’t build the volumes again that you can in the woolstores, with the heights and generous space… people have realised that this is a unique pocket in Brisbane with a strong heritage connection.
“The top floor of this woolstore had flown under the radar screen with no one realising it was there and available.
“Once the heritage issues were resolved, the logistical challenges included building over an established residential development with limited structural point loads, no access to existing building services and developing acoustic separation for the existing residents, during construction and occupation.
“The central corridor acts as a shared space for access to the nine residences, both pedestrian and vehicular. Contained within the envelope of a building, this comes with other complexities including a creative approach to achieving cross ventilation and fire engineering.
“The end result is remarkably simple in terms of having nine homes accessed from a central driveway with a vaulted ceiling spanning the void which all happen to sit inside a heritage building in the middle of the city, which is fascinating.
“It offers a different sort of product in the marketplace. It’s a once in a career opportunity because there’s no more woolstores.”
Above and below – The apartments feature high ceilings and open spaces with chic fixtures and finishes and allow for interaction with external elements allowing for true Queensland-style living.
Teneriffe has now been transformed into a vibrant inner city riverside precinct and has attracted a range of smart retailers, cafes and restaurants to match.
The mechanics for this transformation has been identified by the Urban Development Institute of Australia Queensland president Brett Gillan: “For these and other urban renewal hubs to reach their potential, history shows us there are four key elements to renewal success. A progressive council with a flexible planning approach, community involvement, catalyst projects and developer innovation,” Gillan said.
On Teneriffe’s renewal Dan Williams said, “The gentrification of the area started in the late 90s. There was a large industrial base through the whole of Newstead and New Farm — Teneriffe didn’t exist from about 1975 until it was defined again as a separate suburb in 2010.
“Teneriffe was the Brisbane port area for grain and wool with a long history. Its redevelopment has brought back a wide variety of people. You have some of the richest people in Brisbane living alongside some first homebuyers and those on benefits.
“I think the diversity is a strength and will stay that way in Teneriffe because there’s a diversity of property.”
So what’s next for Williams and his development business?
After 25 years of developing both industrial and residential projects he will probably stick more with land subdivisions and some industrial design and construct. As he says, industrial development is far more non emotional and can be easier to on-sell.
The Australian Estates Company woolstore building as it is today in Teneriffe following the completion of Macquarie Street Residences on the upper level.
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