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Brisbane has officially outstripped Melbourne for property values, with new data showing the city is now the third most expensive capital for median dwelling values after Sydney and Canberra.
A new report from CoreLogic showed Queensland’s capital managed to surpass Melbourne’s median value by about $7000 late last year, making it the first time Brisbane has outshone its larger southern sister since July 2009.
Brisbane’s median value is now $787,217, the report showed, while Melbourne’s was $780,457. Values in Brisbane rose 50.2 per cent since the onset of the pandemic in March 2020, while Melbourne values were only 11 per cent higher.
Experts attributed the remarkable shifting of ranks to the pandemic, with Brisbane collecting record rates of interstate migration over the past three years amidst a mass exodus from Melbourne.
“Australians have revalued what is important to them and because of the legitimisation of working from home a lot of high-income professionals were able to make the move north,” said Eliza Owen, CoreLogic’s Head of Residential Research Australia.
“And a high share of interstate movers come from Victoria as well … Brisbane was definitely one of the major winners of the pandemic.”
Owen said the lack of supply to meet the historic demand for homes across the Queensland capital had fuelled the boom in property values.
“Before the pandemic, Brisbane was oversupplied with dwellings and undersupplied with people – but that totally flipped,” she said.
“In the 2021 and 2022 financial year, the population increased by 51,000 and that’s the equivalent of about 20,000 households.
“In that same period only about 17,500 houses were added to the market through construction so that just goes to show a mismatch of about 16,000 properties over the supply.”
Brisbane property values have jumped since the pandemic hit.Credit: Lucy Stone
Despite the city recording a higher median dwelling value, Owen said Brisbane’s median house and unit values were still $72,000 and $49,000 below Melbourne’s medians, respectively, but said the near historic shifting of ranks came down to the composition of housing stock across both cities.
“Melbourne has a higher share of units as a portion of the dwelling market … because units are generally lower value than detached houses, a higher portion of units brings down the median dwelling across all houses and units,” she said.
Owen expected the rapid-fire rate of property price growth to slow across Brisbane this year but warned the forecast drop in interest rates tipped for late 2024 could spark a flurry of market activity.
She said while Brisbane remained a sellers’ market, the pace of monthly growth in values had slightly eased from 1.5 per cent in October 2023 to 1 per cent in December. The data showed the lure of the sunshine state and Owen warned that Brisbane’s long-running claim of being an affordable capital was slowly being challenged.
PRD Real Estate chief economist Dr Diaswati Mardiasmo said she wasn’t at all surprised by Brisbane’s move to third place in median dwelling values, but she predicted further growth for the city in months to come.
“Buyer demand remains extremely high in Brisbane and I’ve seen it firsthand myself. Every open home is chock-a-block and there’s so much activity … it’s a sellers’ market,” she said.
“We all also know that Queensland and Brisbane in particular had a massive increase of interstate migration during the pandemic, and we were the only state that had that growth. NSW and Victoria on the other hand were the opposite. Our market has just been on steroids here.
“Additionally, the economy has been so resilient here and we’ve clocked economic growth too.”
Mardiasmo said recent wage growth of 4 per cent across Queensland, coupled with the recently doubled state government First Home Owner Grant, would likely boost first home buyer activity throughout the Brisbane market this year which would in turn keep buyer demand strong.
According to the CoreLogic report, Melbourne housing values recorded the weakest increase of any capital city market.
During the same period, Australian Bureau of Statistics data revealed net interstate migration was down 20,000, with net internal migration to the state bottoming out a loss of 35,600 people in the year to June 2021. Over the year to June 2022, Brisbane’s population grew by 2.3 per cent, ABS figures showed.
The CoreLogic report also revealed the Queensland capital was not the only city to shift median dwelling value ranks, with Perth just managing to surpass Hobart. In the median value rankings, Sydney claimed first at $1,128,322 and Canberra claimed silver at $843,171.
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