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Some of Brisbane’s middle and outer suburbs are set to lead the area’s housing marketed recovery in the wakeof COVID-19.
Suburbs such as Macgregor, Mount Gravatt East and Moorooka could rebound faster from the present downturn than the traditionally bulletproof blue-chip suburbs.
Data provided by CoreLogic showed the performance of capital city and regional housing markets three years after the global financial crisis (GFC) and identified the suburbs that outperformed despite the economic shock.
If we look back to how these regions performed post-GFC, we may get some idea of which regions are set to rebound well post-COVID-19. Home values in Rochedale, 17km southeast of Brisbane’s CBD, rose more than 14% in the three years between December 2008 and December 2011 — the best performing housing market in the city post-GFC. The housing market in the neighbouring suburb of Macgregor was also resilient during the period, with home values rising more than 9% at the end of 2011. The best Queensland regional performer in the wake of the GFC was Moranbah, which recorded a 33% surge in home values between December 2008 and December 2011. Of course, the price growth in Moranbah can be linked to the mining boom, so CoreLogic highlights that they believe a surge like this would be unlikely post-COVID-19.
Interestingly, home values in the south and outer Brisbane suburb are also tipped to recover strongly from COVID.
These regions benefit from recent moves to word-from-home situations. Many buyers are reporting that they are looking further afield than they traditionally would as they no longer believe they have to work from their inner-city offices. Of course, this will partly be due to affordability considerations, but also lifestyle factors such as being closer to the water in the Redcliffe or Redlands regions or the chance to live on acreage in parts of Logan or Ipswich are likely to also pull buyers from the inner-city market.
Alderley, 7km north of Brisbane’s CBD, was an exception to the outer suburb trend, recording a 9% rise in median house prices during the downturn.
Other suburbs likely to recover fastest from the current downturn were likely to be middle-ring suburbs that offered more affordable property prices than their inner-city counterparts, but with a similar standard of facilities. Those suburbs could include Kenmore, Macgregor, Moorooka, Mount Gravatt East and Stafford.
CoreLogic head of research Tim Lawless echoed these sentiments as he also believes suburbs within Brisbane’s middle and outer ring, at the lower end of the price spectrum, are likely to rebound the strongest after the pandemic — particularly those close to main arterial roads and train stations.
Mr Lawless said transport options in a suburb was often a driver of stronger capital gains: “As a legacy of COVID, it may be the case that more people are seeking lower-density housing options,” Mr Lawless said.
“Many of the areas with a relatively affordable price tag are located further from the city where transport into the city centre may take some time, although commuting times may be less of a priority if there is lasting willingness from employers to allow staff to work remotely.”
Of course, it’s always difficult to predict which regions will perform best – it’s only with hindsight that most are able to see the signs that indicate a big move. With this in mind, make sure you’re keeping an eye on underlying property ‘basics’ when you go to buy: infrastructure (current and future), along with access to amenities such as schools and shopping centers can be key selling elements in the future. Keep in mind that you want to choose something that will suit you now, but that will also be profitable in the future.
If you currently own in the areas we’ve mentioned above, then we would keep a close eye on houses being sold over the next few weeks. You might be able to sell yours for much more than you’d expect!