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Queensland Budget 2018: What it Means for the Property Industry

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Queensland Budget 2018: What it Means for the Property Industry
Queensland Treasurer Jackie Trad handed down the Queensland State Budget on Tuesday, delivering a surprise $1.5 billion surplus and putting an extra $200 million into people’s pockets.

This year’s budget focused on infrastructure, tourism and mining funding.

Property investors will also be met with a 0.5 per cent increase in the land tax rate for aggregated holdings above $10 million, as well as an increase in the additional foreign acquirer duty from 3 per cent to 7 per cent.

The government also announced it will cut back the first home owners’ grant.

So what does the state budget mean for the property industry?

Here is what you need to know.

Additional Foreign Acquirer Duty

Aligning with states nationwide, the Queensland government announced an increased rate for additional foreign acquirer duty.

The AFAD is an additional tax on relevant transactions that are liable for transfer duty, landholder duty or corporate trustee duty which involve a foreign person directly or indirectly acquiring certain types of residential land in Queensland by foreign persons.

The duty will rise from 3 per cent to 7 per cent and is forecasted to result in an increased revenue of $33 million per annum.

Infrastructure Improvements

The state government will dedicate $4.217 billion to transport and roads.

The Sunshine State’s long-awaited duplication of the Sunshine Coast rail line received $161 million.

The Toowoomba Second Range Crossing project received $543.3 million, a route to the north of Toowoomba from Helidon to the Gore Highway.

Brisbane’s Cross River Rail received $733 million to go toward the $5.4 billion project. The federal government failed to pledge any assistance towards the Cross River Rail project earlier this year leaving the state government to foot the bill.

There’s also $487 million over four years for upgrades to the M1 on Brisbane’s south and on the Gold Coast.

Queensland Budget 2018: What it Means for the Property Industry

Proposed Exhibition station on Cross River Rail. Artist’s Impression.Image: Cross River Rail Authority

First Home Buyers Grant Slashed

First home buyers have come to expect a $20,000 starter grant since 2016 will now see it cut to $15,000 if they buy a house from July onwards.

The $5,000 boost had been added to the grant in 2016 by former Treasurer Curtis Pitt, with the measure supposed to be in place for just one year.

It was extended twice in six-months until the end of 2017 and then to June of this year.

Land Tax Increase

Under the new taxes introduced in Tuesday’s budget, foreign landowners with more than $10 million worth of landholdings will now be in line for a 0.5 per cent increased rate of land tax.

Individuals with properties worth more than $10 million will now incur an additional rate of 2.25 per cent (or 2.5% for trusts or companies) for every dollar of taxable value over $10 million.

This is expected to bring in $71 million in revenue in its first year, with a projected 11 per cent increase in 2018-19 land tax revenue.

Source: theurbandeveloper.com

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Suburb record falls as hundreds turn out for marathon 45-minute auction

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Suburb record falls as hundreds turn out for marathon 45-minute auction

It was a busy week in the Brisbane auction market with 104 properties and an improved clearance rate of 42 per cent.

A thrilling auction in Grange saw 250 people watch eight registered bidders attempt to make their claim on a beautiful five-bedroom, three-bathroom property on 607 square metres.

Bidding for the newly built home opened at $1 million, climbed in $100,000 increments to $1.7 million before slowing to $50,000 and $25,000 jumps until the home was put on the market for $1.79 million.

The field narrowed to two participants, who bid in lots of $500. After a marathon 45-minute auction with more than 50 bids, the property was ultimately sold under the hammer for $1,820,500.

Suburb record falls as hundreds turn out for marathon 45-minute auction1

That marks the highest sale price for a property under 800 square metres in Grange. The previous record was $1,775,000.

All eight of the registered bidders were local families, exactly what agent Alistair Macmillan, of Ray White Wilston, was expecting.

“We were very much involved with the design process of the home,” he said. “We deliberately tried to build a property that was going to appeal to a broad market. The intention was to build a traditional-style home that appealed to a younger-type family.

“Our objective, even pre-build, was always to try and build a product that was going to put pressure on that record price, so we’re pretty chuffed to set a new record.”

Meanwhile, a two-storey house overlooking New Farm Park was sold for $2.27 million under the hammer. About 50 people watched as two registered bidders battled it out for about 25 minutes for the property.

Bidding opened at $1.8 million and jumped to $1.9 million. The price rose in lots of $50,000 to $2.25 million. At that point negotiations began, then the property was put on the market and sold for $2.27 million.

Suburb record falls as hundreds turn out for marathon 45-minute auction2

Agent Matt Phillips, of Image Property Aspley, said the location and layout of the home had been very popular with the 50 groups that had inspected it during the campaign.

“The master bedroom had a balcony overlooking New Farm Park, and there’s two other bedrooms with balconies overlooking [the park],” he said. “It’s only a one-way road through Hopetoun Way, so there’s not much traffic there.

“There was not many people who came through that didn’t like it. [We had] very positive feedback throughout the whole campaign.”

Phillips said the buyers had been eyeing the property keenly, and were thrilled with the result.

“They were really excited,” he said. “They were trying to secure the property the whole way along, so they were happy they could be successful on the day.”

On the other side of the city, a beautifully designed four-bedroom, two-bathroom home on 583 square metres was sold at auction. Three registered bidders fought it out in front of a crowd of 100 people to secure the property.

The opening bid was $1.3 million, followed by an auctioneer bid of $1.4 million. The price jumped to $1.5 million and then $1,625,000, at which point the auction paused.

After consulting with the agent, the third bidder raised their paddle for the first time at $1.8 million. After some negotiation the price was raised to $1,805,000, then the house was put on the market and sold at that price.

Suburb record falls as hundreds turn out for marathon 45-minute auction3

Agent Saeed Moghaddam, of Brisbane Real Estate, said the vendors were happy with the result.

“They bought this land three years ago, and started construction last year, and they were going to move into this property. But they got a job offer down in Sydney, and the offer was too good not to take,” he said.

“The situation gave [the buyer] the opportunity to move on in his life. In his mind, he was convinced that it was the best price he could get in this market.”

Moghaddam said the result shows that despite a struggling market, high-quality properties still did well.

“It still reflects that the Brisbane market is strong for good properties,” he said. “Either properties on the river or with great city views still hold their value even in this market.”

Source: www.domain.com.au

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Brisbane’s Comeback: Luxury Homes on Upswing 8 Years After Floods

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Brisbane’s Comeback Luxury Homes on Upswing 8 Years After Flood

Prices and interest in prestige properties have remained strong in recent months

Cashed-up Brisbane buyers are showing an increasing appetite for well-positioned premium waterfront properties, making a play for rare parcels of land and luxury homes along the city’s prestigious riverside.

Snaking its way through the Queensland capital city, Brisbane River was subjected to terrible flooding in 2011, which caused widespread and devastating damage to the city’s property market.

Prices dropped immediately between 5% and 10% across Brisbane, according to Australian Property Monitor figures, and the city has since staged a slow and steady recovery.

Several impressive blue-ribbon riverside properties have been listed for sale in the past six months, testing the strength and depth of the market, which has responded positively as buyers savor the choice of high-quality lifestyle properties available.

Real estate agents report they’re receiving multiple offers on prestige waterfront homes priced between A$4 million (US$2.84 million) and A$10 million. However, they’re cautiously optimistic, claiming the competition had led to steady results rather than a spike in prices.

“There’s not enough good quality properties out there,” NGU Real Estate principal Emil Juresic said of current market conditions.

“For those buyers who have A$4 million to A$10 million to spend, there are not enough prestige homes to suit their needs,” he said.

Those requirements, Mr. Juresic said, are specifically for new or renovated homes finished to the highest quality, for which there’s genuine buyer interest.

“The market is solid, it’s not going up or down … making it the best market for buyer and seller,” he said.

“Quality sells,” Mr. Juresic said. “If you’re a seller, don’t bother putting your house on the market unless it’s in a perfect condition because buyers in that price range don’t want to renovate or do anything to it. Make it perfect because you’ll get your money back or make a dollar on top.”

Brisbane doctors, husband and wife Chris and Tania Bradshaw, are asking A$11 million for Nareke, their waterfront home at Highgate Hill, 2.5 kilometers southwest of Brisbane’s central business district.

 

Brisbane’s Comeback Luxury Homes on Upswing 8 Years After Flood

The three-level mansion was built in 1996 by the previous owner, who wanted to pay homage to Brisbane’s colonial architecture with its elaborate fretwork and wraparound verandas.

Occupying 60 meters of Brisbane river frontage, with a private jetty and boatshed, Mr. Bradshaw considers the home a value proposition for someone wanting to buy prestige waterfront.

“I honestly believe we’re selling it for about a third of what it’s worth,” he said.

“Taking into account the construction cost and land value, it comes to about three times the asking price. It’s a really good buy for somebody,” he continued.

Proven Prices

Brisbane’s housing market has shown modest growth in the past five years, with median house values up 0.4% in the year to December 2018, figures from data provider CoreLogic show.

Brisbane’s dwelling values in 2016 and 2017 increased 1.6% and 1.8% respectively, weighed down by a glut of new apartments on the market.

In contrast, the residential housing markets of Sydney and Melbourne increased 18.4% and 13.1% respectively in the 12 months before prices peaked in 2017. Australia’s two biggest markets have since become the country’s softest markets, suffering double-digit price falls in the past year according to CoreLogic, with median house values at their lowest levels in three years.

A week before its expression of interest campaign ended on April 4, Sarah Hackett, principal of Place Estate Agents in Bulimba, sold a home on Wendell Street in Norman Park for A$6 million on behalf of the owner, Brisbane developer Tim Forrester. It last traded in March 2013 for A$3.9 million.

She said the exceptional standard of the renovation, along with its premium waterfront position and stunning city skyline views, had attracted three offers from Brisbane-based families.

“For good quality properties there are still multiple offers happening, which is a really good sign,” Ms. Hackett said.

“The empty-nester market is looking to move to areas that offer them a lifestyle connection to the water, cafes and a good quality home,” she said.“The other buyer market are families where both mum and dad are working and they have no time, so they want to be able to walk into a house that is fully done and requires no work.”

Market Tests

Balaam, an ultra-modern eight-bedroom home for sale on Harbour Road in Hamilton, was to test both the depth and growth in the prestige market when it went to auction in March.

Brisbane’s Comeback Luxury Homes on Upswing 8 Years After Floods3

However its failure to sell under the hammer hasn’t knocked the confidence of selling agent Ray White New Farm principal Matt Lancashire, who believes the three-level home, which occupies a 48.3 meter stretch of the Brisbane River, will set a new price record for the area. It last traded for A$11.8 million in 2015.

Mr. Lancashire has fielded genuine interest from five parties and his confidence was buoyed further by the success of an earlier auction in March when a waterfront mansion on Griffith Street in New Farm sold for A$7.75 million. It attracted competitive bidding from eight registered parties, selling during post-auction negotiations.

Prospective buyers interested in luxury waterfront homes are a mix of Brisbane-based locals trading up and interstate migrants, relocating to what is colloquially referred to as “the Sunshine State” for work and lifestyle.

The Australian Bureau of Statistics data show over the past decade, Queensland’s interstate migration grew by an average net figure of 11,000 people per year. It’s this figure real estate experts believe will underpin Brisbane’s forecast of moderate price growth in 2019.

“Anecdotal evidence from our agents suggests that we are seeing property buyers moving here from interstate, lured by the greater bang-for-buck proposition that is presented by our real estate,” REIQ chief executive officer Antonia Mercorella said.

“Quite simply, your real estate dollar goes further in Queensland,” she said.

Mr. Hackett said her average buyer in 2018 was 60 years old and spent A$4.1 million. This year, amid the calls she’s receiving from retirees are eager younger families from Sydney and Melbourne.

“We are dealing with two families a week who are moving back to Brisbane for cost of living and lifestyle,” she said.

“On average, they have $2 million to $3 million to spend. Brisbane is becoming a big city, a new restaurant is opening each week and there’s a lot of new development and that’s driving property,” she said.

Mr. Juresic, too, has found half his prestige buyers are Brisbane locals while the rest are coming from interstate or overseas.

“It’s an extremely liveable city at the moment,” he said of Brisbane.

“It’s not a little village anymore,” he added. “A lot of people might sell a house in Melbourne’s Toorak for A$12 million to A$14 million and they can buy a house in Brisbane that’s probably better and closer to the city for A$4 million to $5 million.”

 

 

Source: www.mansionglobal.com

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Why more families than ever are quitting Sydney and leaving for Brisbane

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Why more families than ever are quitting Sydney and leaving for Brisbane

Sydney siders are looking to buy property in southeast Queensland more than anywhere else in Australia, new data shows.

Exclusive research from Domain into out-of-area inquiries made by people living in Sydney has revealed that, last year, more than 50 per cent were looking at buying property in Queensland.

That’s up 5 per cent on 2017 inquiries and, so far this year, that figure is increasing again.

The highest proportion of those inquiries was to Brisbane (21.5 per cent), followed by the Gold Coast (15.3 per cent).

Only 25.7 per cent of Sydney buying inquiries were made to Victoria and, moreover, that figure has been falling since 2017.

Why more families than ever are quitting Sydney and leaving for Brisbane1

 

It’s in line with ABS figures released last week, which showed the top three areas with the biggest flow of interstate migration.

Brisbane had the most by far, followed by the Gold Coast, Sunshine Coast and then Melbourne – while Sydney had a net loss of -27,300.

Domain data scientist Eliza Owen said the figures pinpointed exactly where the growing interest was in Queensland.

“We can track where those inquiries are increasing and decreasing, and can see that the portion of people looking to buy in Queensland has increased over time and overtaken Victoria,” she said.

“The Gold Coast in particular has had strong growth over the past couple of years and we can see the increase in inquiries has grown at quite significant levels and is continuing well into this year.”

 

Why more families than ever are quitting Sydney and leaving for Brisbane2

 

Kristi and Lance Burrows were happily renting a small townhouse in Mona Vale, in Sydney’s northern beaches, when Lance was offered a job in Brisbane last year.

“We originally turned it down because I was heavily pregnant with our second child but then we toyed with it a bit more … the lifestyle in terms of being right in the middle of Byron Bay, Noosa — and the property market, we could buy somewhere, which was a massive incentive,” Ms Burrows said.

The couple took a leap of faith and moved with their two small children, Kingston and Ruby, and settled in Balmoral, in Brisbane’s exclusive inner east.

After renting for a few months, they purchased a two-bedroom weatherboard cottage on 430 square metres of land — and plans are already in motion for an extension that will bring the footprint to four bedrooms, two bathrooms and a pool.

Mr Burrows, general manager at Howard Smith Wharves, catches the ferry to work every day and Kristi has just started a part-time job two days a week.

 

Why more families than ever are quitting Sydney and leaving for Brisbane3

Achieving the equivalent in Sydney would have been a pipe dream, Ms Burrows said.

“If we were still in Sydney? We would have still been renting. For us to purchase in the northern beaches we would have had to put another $1 million in front of what we paid here,” she said.

“For us to buy in Sydney I would’ve had to work full-time and for a good five years with both our wages to save for a deposit. So the reach was really far; it was not something we could’ve realistically done.

“I had a friend who spent just under $1 million for a teeny townhouse in Narrabeen. We bought a free-standing house for well under that, and even after we renovate we will have only spent the same — and we’ll have four-bedroom home with a pool, four or five kilometres from the city. That’s why we’re still here.”

Demographer Mark McCrindle said it was clear that people were looking for alternatives to the cost of living, the congestion and the sheer size of the city.

Why more families than ever are quitting Sydney and leaving for Brisbane4

 

“Sydney, while Australia’s largest and most global city, is losing numbers and the data shows it’s those in western Sydney that are more likely to move,” he said.

“Those southwest areas — Parramatta, even the inner west — that’s where the biggest exodus is coming from. It’s those who are the furthest out with the worst commutes who are questioning a lifestyle change.

“The buy data is fascinating — it’s a little more aspirational. They’re dreaming about their ideal new life and it’s all a story of southeast Queensland.”

Meighan Hetherington, director and buyers agent at Property Pursuit, said she saw two key groups of Sydney buyers in Brisbane.

“One of these groups is the buyers who want a lifestyle change and that mortgage relief,” she said.

 

Why more families than ever are quitting Sydney and leaving for Brisbane4

 

“They’re selling out of their Sydney asset and looking for mortgage-free purchases, which allows them to step out of that corporate lifestyle, step back from working 60 to 80 hours a week to come back and focus on spending more time with family.”

The main other type of Sydney buyer was investors with a budget of $800,000 to $1 million, Ms Hetherington said.

“They’re sophisticated investors with a plan to invest in high-quality assets in Brisbane,” she said.

“They’re not the entry-level investors who we saw buying up cheap properties around Logan, Ipswich and Stafford around 2016 — a lot of these investors are buying in Brisbane on the advice of financial planners who have identified Brisbane as having a stable economic base and that steadier growth over the long term.”

She said they’re making conscious decisions to buy properties where the land value content is high.

 

Why more families than ever are quitting Sydney and leaving for Brisbane6

 

“They’re buying in more of the key suburbs like Paddington, Wilston, Grange, Balmoral, Red Hill, and because of that, rental income or yield is a low priority,” she said.

“They’re focused on capital gains, so they want to buy low-density, entry-level character cottages on good land.”

Shannon Harvey of Place Estate Agents Bulimba sold the Burrows’ their Balmoral home and said it was more than just cheap housing that was drawing Sydneysiders to Brisbane.

“They can see the value and yes, Sydney isn’t performing well but there is more to it than that,” she said.

“Brisbane has become a really dynamic place to live, there’s a lot of infrastructure going on and there’s work here. It’s the lifestyle.

 

Why more families than ever are quitting Sydney and leaving for Brisbane7

 

“Bulimba State School had 25 new families join the school from interstate this year. I mean, it’s huge. People from Sydney love this area because it’s on the river, it’s got the original cafe strip culture and it’s tight-knit.”

Ms Burrows said there were certainly things she and her husband missed about Sydney.

“We miss the beach being so close, like on our doorstep. We were pretty spoilt with where we could go from where we lived. That’s the biggest miss for us, being by the water,” she said.

“And having our friends close by as well. That said, everyone is so busy in Sydney. We miss our friends but how often would we have seen them?”

Mr McCrindle said despite the negative flow away from Sydney to interstate locations like southeast Queensland, it was still Australia’s global city.

“People haven’t quit on Sydney. It’s still Australia’s economic gateway — but it’s almost a victim of its own success,” he said.

“We’ve had a fair bit of catch up on infrastructure the past five years and it will take another 15 to get there but if we fast forward another couple of decades, we’ll see Sydney shine again.

“With that international brand and a nation-leading economy, it will get back there.”

 

 

Source: www.domain.com.au

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