Sydney, Canberra and Melbourne have long been touted as Australia’s most expensive cities when it comes to property, but after three years of a COVID-19-bolstered boom, Brisbane has climbed the ranks.
Since 2020, homes in Queensland’s capital have increased by 50 per cent, making it now the nation’s third most expensive city with median dwelling price of $787,217.
Corelogic data shows it’s the first time in 15 years that dwellings in the Greater Brisbane region are more expensive than Melbourne’s median price of $780,457.
Michael Deacon’s family had to get innovative to survive Brisbane’s booming property market, combining incomes with his mother-in-law to buy a home for three generations.
“It was pretty scary. We didn’t know what we were going to do,” he said.
“She was the one that actually suggested the idea to us.
“It’s a two-storey house but it’s complete dual living so an upstairs-downstairs, and it’s great for our daughter.”
While Mr Deacon’s mother-in-law Pat Smith had no mortgage on her home, rising interest rates coupled with the growing property market made her worry for her family’s future.
“We were thinking of leaving Brisbane altogether and going up to Yeppoon because prices were a bit cheaper, but we decided against that. It was too big a move,” Ms Smith said.
Brisbane remains seller’s market
While December’s median price for dwellings in Brisbane was more than Melbourne, the median house price was still cheaper in the Sunshine State at $875,991, compared to Victoria’s capital of $948,041.
According to Corelogic, units were also cheaper in Brisbane with a median price of $561,016, while the median price of units in Melbourne was $610,122.
Corelogic’s head of research Eliza Owen said the high amount of units in Melbourne, compared to Brisbane, brought down the dwelling cost overall.
“About a third of that market is units, which weighs down the median, as opposed to Brisbane, where only about 25 per cent of housing stock is estimated to be units,” Ms Owen said.
ABC News: Ian Cutmore
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She said Brisbane would remain on top in the “tussle” against Melbourne in the short term, with prices in Queensland’s capital continuing to rise.
“Melbourne is actually still in decline, with values down about 0.3 per cent in the past four weeks,” she said.
While Brisbane remained “a seller’s market”, properties weren’t increasing in value at the same rate, with the monthly growth decreasing from 1.5 per cent in October to 1 per cent in December.
Ms Owen said flood-impacted homes could cause a further stabilisation of the market.
“Some people might find that they just want to get out of flood-prone areas altogether so that will impact demand and probably create some more variation in capital growth,” she said.
Brisbane’s continual rent increases ‘unheard of’
Renters in Brisbane are also under prolonged pressure, facing an “unheard of” streak of rental rises, with new figures showing rents increased steeply in the most recent quarter.
Released today, the Domain Rental Report shows Brisbanites are now paying an average of $600 per week for houses and $560 for units.
It marks the 10th consecutive quarter of growth for unit rents.
Domain’s chief of research and economics, Nicola Powell, said the state of the rental market was now at unprecedented levels.
“Ten consecutive quarters of unit rental growth is pretty much unheard of,” Dr Powell said.
“I think it really showcases the pressure that the rental market has experienced in Brisbane.”
She said record high rental prices showcase a serious lack of supply of rentals on the market, with rental vacancies at an all-time low back in February of last year.
Brisbane’s vacancy rate has increased slightly since then, to 0.9 per cent.
“It really showcases there hasn’t been enough investment activity across the city,” Dr Powell said.
She said demand was also outstripping supply as people moved in droves from interstate and overseas.
There is some hope for renters this year, with signs the rate of increase is slowing slightly — not just in Brisbane but across the country.
Domain’s report shows combined rents across Australia’s capital cities held steady for the first time in almost three years, ending its own stretch of 10 consecutive quarterly increases.
Across the nation, the average house and unit rent were each $600 per week.
At the end of 2023, Sydneysiders paid an average of $730 per week to rent a house, the most of any city across the nation.
Hobart saw the highest increase after the average rent rose by $20 per week during the last quarter, to $550 per week.
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