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Brisbane house prices hit record high in 2020, despite COVID-19

Brisbane house prices

Brisbane house prices have soared to record heights after a steady 12 months of growth and a sizzling summer of sales, with the median price rising to an unprecedented $738,000.

The latest Domain House Price Report, released Thursday, revealed median prices in Brisbane LGA rose by 2.2 per cent over the December quarter, with the pandemic-inspired trend towards more space and a backyard fuelling the spike.

Domain senior research analyst Nicola Powell said the surge was also testament to the sheer pulling power of a city that had become a magnet for southern buyers seeking better bang for their property buck and a balmy climate.

“Interest rates are also extremely low and that cheap credit is a big lure for some buyers. This really does heighten activity and with interest rates expected to stay low I’m expecting the market activity to remain like this,” Dr Powell said.

Greater Brisbane region house prices

Greater Brisbane region house prices
Lockyer Valley$389,500$405,000$375,000-3.8%3.9%
Moreton Bay$510,000$515,000$485,000-1.0%5.2%
Scenic Rim*$550,000$510,000$470,0007.8%17.0%

“But one of the other factors driving growth is the affordability. So, while Brisbane has always had a pull from southern states, I think it has been accelerated (due to the pandemic) and this is driving prices.”

Alex Jordan, of McGrath Estate Agents Paddington, said that trend had since culminated in one of the strongest markets he had ever seen, particularly for the Brisbane LGA.

“I sold 10 Bernhard Street, Paddington, for former Brisbane Broncos head coach Anthony Seibold in October last year for $2.3 million, in April 2019 it sold for $1.9 million,” Mr Jordan said.

“I also sold 100 James Street, New Farm, on November 13 for $2.91 million and it last sold in September 2018 for $2.4 million.

“Both of those examples are of homes that sold within about two years or less and they both had 20 per cent price increases with neither of them undergoing any major changes.

“On top of that I think the last quarter of 2020 was the largest migration into the Brisbane market we’ve seen in terms of inquiry and buying.”

Capital cities – median house prices
Capital citiesMedianQoQYoY
Greater Brisbane$616,3870.8%5.6%
Source: Domain House Price Report, December Quarter, 2020.

While inner-Brisbane house prices clocked great quarterly growth during December, Mr Jordan said larger homes in outer suburbs were still hot property, with suburb price records smashed in a handful of the city’s hottest lifestyle spots.

“For example, in Chelmer the suburb price record was just broken with 47 Longman Terrace, which sold for $8 million [through Dixon Estate Agents],” Mr Jordan said.

Ray White New Farm agent Christine Rudolph said while interstate and overseas migration to the Queensland capital had fuelled a sky high summer of sales on her end, downsizers were leading the charge within the inner-city’s piping hot market.

“In the past quarter I’ve noticed a shift with the empty nester demographic who are now looking to downsize into house in the inner city as opposed to a unit,” Ms Rudolph said.

“Three of my $2 million-plus sales in the past quarter were all to buyers in the 60-plus (age) bracket and they set a preference for a contemporary low maintenance house in the inner city. They are spending more time at home [due to covid] while also being retired so they still wanted the benefit of the garden and the separation of space during a lockdown. Covid has definitely changed people’s requirements.”

Ms Rudolph said one hot spot for lifestyle buyers was Yeronga, where she clocked a price record for a 607-square-metre dry lot at 39 Ormonde Street in December last year.

Greater Brisbane region unit prices

Greater Brisbane region unit prices
Moreton Bay$348,500$320,000$325,0008.9%7.2%
Source: Domain House Price Report, December Quarter, 2020.

“We have definitely seen price increases there. During September las year we achieved a then price record of $2.625 million (for 39 Ormonde Street) and everyone was applauding us and then three months later just before Christmas we had a buyer from Melbourne call us. They ended up superseding the previous suburb record for a 600-square-metre dry lot and paid $2.85 million,” she said.

While median house prices across Greater Brisbane also rose by a slight 0.8 per cent over the December quarter to a record $616,387, the Domain report revealed the city’s long-suffering unit market took a 1.1 per cent hit to $395,218, with experts citing gun-shy investors and the move from low-maintenance living to a home with a yard as major factors.

“The Brisbane unit market has passed its construction peak, so it’s a sector that’s still trying to find a balance. We have also seen few investors in the market (since COVID-19 struck),” Dr Powell said.

“But while we’ve seen a pull-back in investor activity, the Brisbane rental market has tightened significantly so that in itself could be a lure for investors which could help to absorb some of that supply in the future.”


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Barwon secures Princess Alexandra Hospital car park

Barwon secures Princess Alexandra Hospital car park

Barwon Investment Partners has snapped up a multi-level car park and medical centre on a site with significant development upside opposite Princess Alexandra Hospital.

The Woolloongabba asset at 250 Ipswich Road is setting the healthcare focused fund manager back around $95 million, reflecting a circa four per cent net passing yield.

The property contains an eight level, 773-bay garage attached to a two floor wellness centre with 21 tenancies, anchored to Gabba Dermatology, Brisbane Cardiology and Allied Health; the Weighted Average Lease Expiry is nearly seven years.

A pedestrian overpass connects the building to the Princess Alexandra Hospital, also a major teaching campus, employing 6810.

The 5106 sqm block has significant upside – up to 15 storeys based on its zoning, according to JLL’s Seb Turnbull, Elliott O’Shea and Simon Quinn, who marketed the asset with a Blight Rayner scheme.

BIP invests again

Established in 2006, BIP holds a property portfolio worth $2.3 billion.

Its medical related product, much held in a Healthcare Property fund, is priced at about $1.4b as at March, 2022.

Seven months ago, for the trust, the manager paid Forza Capital $34.7m for a South Brisbane medical centre – not far from 250 Ipswich Rd – and two Canberra assets including Belconnen’s Ginninderra Medical & Dental Centre on nearly a hectare.

Also late last year BIP spent $75m for a 12 level St Kilda Rd office majority leased to Alfred Health.

More to come.



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Brisbane’s Office Market Greenlit for Business

Brisbane’s Office Market

Brisbane’s office market continues to shake off the pandemic doldrums with two new commercial towers approved in the CBD and fringe suburbs.

Property owner PGIM and development partner Indema’s plan for a bold adaptive reuse of a 1970s commercial building at 444 Queen Street has won approval.

The bronze 22-storey tower opposite Customs House will be stripped back to its core structure and completely remodelled with a new podium, curtain wall facade and an additional two-storey sculptural canopy.

Indema director Michael Bruderlin said they would be targeting a net zero certification for the building upon completion in the first quarter of 2024.

Bruderlin said Hutchies had been engaged in an early contractor design and construct contract to help de-risk the project and better understand the technical requirements.

The Fender Katsalidis-designed tower follows in the footsteps of another of its commercial adaptive reuse projects in Brisbane, Ashe Morgan’s Midtown, now the headquarters for Rio Tinto.

Bruderlin said retaining and repurposing the existing building is 400 per cent more environmentally friendly. Retaining the existing concrete structure provides a 70 per cent saving in embodied carbon.

The project will rejuvenate a 48-year-old building at the end of life into an A-grade commercial office asset and increase the net leasable area 40 per cent.

Bruderlin said the project would have a quicker turnaround than a normal demolish and build project and it would use clever design initiatives to increase floor plates and create a better value proposition for the asset.

PGIM purchased 444 Queen Street for $54.4 million from the Public Trustee of Queensland and Abacus Property Group in October last year.

Cornerstone has also won approval for a commercial development in the city fringe suburb of Fortitude Valley.

The Bureau Proberts-designed tower will capture the heritage brick character of the Fortitude Valley centre “borrowing from the intent of these buildings but with a stridently different and contemporary expression”, planning documents said.

“This approach is a deliberate counterpoint to the strong and solid brick structures of the immediately adjacent 47 Warner Street and McWhirters buildings.

“Brickwork or masonry is not used as a material in deference to these neighbouring buildings allowing them to become more evident and make a clear statement about the era of their inception.”

The 28-storey commercial tower at 251 Wickham Street features a stepped slanting facade fronting Warner Street, with a four-storey lobby, and an inverted podium.

There will also be a rooftop terrace, 20m pool and open-plan gym in the commercial tower, with retail offerings at the base of the building.

Brisbane’s metropolitan office market vacancy was at 16.3 per cent at the end of March and there were few transactions across the quarter, according to Colliers research.

But yields remained steady, and well above other capital cities, while incentives remained stagnant at 40 per cent.



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Developer Pitches for $130m Shop-Top Housing on Bayside

$130m Shop-Top Housing on Bayside

Brisbane’s bayside could be going up in the world with plans for $130-million highrise shop-top housing in the heart of the seaside suburb of Wynnum.

Brisbane-based developer Hambros has lodged plans for a 21-storey apartment tower on the vacant lot neighbouring the Wynnum Central Shopping Centre, after winning approval for an small extension to the retail centre late last year.

The development comprises a 6-storey retail and commercial podium, with a 275-apartment tower above, backing on to Wynnum Central Park.

Hambros has reportedly spent about $14 million on revamping the Wynnum Central Shopping Centre on Bay Terrace, as part of a $74-million plan to rejuvenate Wynnum, including cinemas.

According to planning documents lodged with the Brisbane City Council, the tower will be made up of 54 one-bedroom apartments, 148 two-bedroom apartments, and 67 three-bedroom apartments, with six penthouses, which will have private rooftop space and their own pools.

The building height is well in excess of the allowable five to eight storeys in the Wynnum Manly Neighbourhood Plan, but town planners Gateway Survey and Planning argued the plan was “outdated” and should be overhauled.

The six-storey podium would contain two levels of parking, a retail tenancy at ground level, a floor of retail, with two storeys of commercial space for office, healthcare and events space on levels 5 and 6.

Developer Pitches for Shop-Top Housing on Bayside Brisbane

▲ Shayher Group won approval for its redevelopment of Wynnum Plaza last year, which included 184 apartments across eight residential buildings.

In a statement to the council Hambros director Justin Ham said the Wynnum CBD had been left behind “with no development occurring in the last 20 years”.

“Our project is designed to put Wynnum CBD on the ‘open for business’ map,” Ham said.

“This landmark development, with a construction cost estimated at $130 million will have a huge financial and community positive impact on the Wynnum CBD and surrounding areas.

“It’s a once-in-a-lifestime opportunity to create a beautiful space overlooking the best bay in the world.”

Ham said the development would bring much-needed foot traffic to the heart of the Wynnum CBD and help bolster businesses and landowners he said were struggling to remain profitable.

Taiwanese developer Shayher Group won approval for a masterplanned retail precinct at Wynnum Plaza with plans for 184 apartments across eight residential buildings as well as boutique cinemas and increased retail space, reportedly worth more than $100 million.

Work on the Wynnum Plaza redevelopment was due to commence later this year with a completion date hedged for 2024.



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