Brisbane’s luxury property market has become the state’s best- performing real estate sector, driven by investors looking to diversify their assets and helping the city defy the downward trend of the past two years.
The growth in high-end sales has prompted CBUS Property to commission the 443 Queen Street project, which is being marketed by CBRE and will house 264 apartments over 47 levels.
Located on a small island between the Brisbane River and the CBD’s Queen Street, the development was designed by Singapore’s WOHA group and Architectus, a Brisbane-based firm.
CBRE Brisbane manager Paul Barratt said the higher end luxury market was performing well in the city, with a growing number of apartments attracting price tags above the $1 million mark.
The firm is also selling the $150m Banyan Tree development in the city’s prestigious Kangaroo Point precinct.
“It’s the best performing sector of the market at the moment,” Mr Barrett said.
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“People think Brisbane has a demographic that has a lower household income but if you look at the figures the city is comparable to Sydney.
“The numbers show that Brisbane income is just 4 per cent lower than that of Kirribilli in Sydney — there is a lot of wealth in Brisbane.”
The city’s top-end market has been the beneficiary of investors beginning to diversify asset classes, primarily away from the domestic and international equities markets, and robust interstate migration.
“Property is still seen as the bricks and mortar investment. There has been a shift among some property investors though — 10 years ago you might have had a buyer purchase two apartments in a development they liked,” Mr Barratt said.
“But now it’s more about quality … people are looking for scarce assets. There is scarcity in the high-end market and that drives value.”
Belle Property agent Ivo Kornel, who is selling the Harry Seidler designed Riparian Plaza penthouse for $2.49m at Brisbane’s 71 Eagle Street, said there was a divergence between top-end properties and the rush of recent high-density apartment development in the city.
“People are happy to be paying for quality in Brisbane. There’s been a lot of development in the city that is only average,” Mr Kornel added.
“That is trickling down through the market but people are not going to spend $2.5m willy nilly. In this bracket you’re seeing the people who love the city centre, they might be living in a penthouse at the moment but have grown out of it, so they are looking to upsize or for a better build.”
Mr Kornel said Brisbane was attracting major interest from interstate buyers, especially Sydney, and overseas purchasers from Hong Kong and mainland China.
In Sydney, Wonderland, the 294-unit final stage of the Central Park development in inner city Chippendale, is now selling with prices from $595,000 to $2.8m.
Colliers International director Peter Chittenden said a growing number of investors were buying property to diversify their assets and sales in the project so far had predominantly been from owner-occupiers.
“People are looking and thinking where else are they going to get good growth, they aren’t getting it at the bank, the sharemarket is volatile and superannuation is tied to that sharemarket volatility,” he said.
“Property at the higher end of the market in Sydney has had double digit growth year on year.”
Original article published at www.theaustralian.com.au by SCOTT MURDOCH 06/8/16