Prices and interest in prestige properties have remained strong in recent months
Cashed-up Brisbane buyers are showing an increasing appetite for well-positioned premium waterfront properties, making a play for rare parcels of land and luxury homes along the city’s prestigious riverside.
Snaking its way through the Queensland capital city, Brisbane River was subjected to terrible flooding in 2011, which caused widespread and devastating damage to the city’s property market.
Prices dropped immediately between 5% and 10% across Brisbane, according to Australian Property Monitor figures, and the city has since staged a slow and steady recovery.
Several impressive blue-ribbon riverside properties have been listed for sale in the past six months, testing the strength and depth of the market, which has responded positively as buyers savor the choice of high-quality lifestyle properties available.
Real estate agents report they’re receiving multiple offers on prestige waterfront homes priced between A$4 million (US$2.84 million) and A$10 million. However, they’re cautiously optimistic, claiming the competition had led to steady results rather than a spike in prices.
“There’s not enough good quality properties out there,” NGU Real Estate principal Emil Juresic said of current market conditions.
“For those buyers who have A$4 million to A$10 million to spend, there are not enough prestige homes to suit their needs,” he said.
Those requirements, Mr. Juresic said, are specifically for new or renovated homes finished to the highest quality, for which there’s genuine buyer interest.
“The market is solid, it’s not going up or down … making it the best market for buyer and seller,” he said.
“Quality sells,” Mr. Juresic said. “If you’re a seller, don’t bother putting your house on the market unless it’s in a perfect condition because buyers in that price range don’t want to renovate or do anything to it. Make it perfect because you’ll get your money back or make a dollar on top.”
Brisbane doctors, husband and wife Chris and Tania Bradshaw, are asking A$11 million for Nareke, their waterfront home at Highgate Hill, 2.5 kilometers southwest of Brisbane’s central business district.
The three-level mansion was built in 1996 by the previous owner, who wanted to pay homage to Brisbane’s colonial architecture with its elaborate fretwork and wraparound verandas.
Occupying 60 meters of Brisbane river frontage, with a private jetty and boatshed, Mr. Bradshaw considers the home a value proposition for someone wanting to buy prestige waterfront.
“I honestly believe we’re selling it for about a third of what it’s worth,” he said.
“Taking into account the construction cost and land value, it comes to about three times the asking price. It’s a really good buy for somebody,” he continued.
Brisbane’s housing market has shown modest growth in the past five years, with median house values up 0.4% in the year to December 2018, figures from data provider CoreLogic show.
Brisbane’s dwelling values in 2016 and 2017 increased 1.6% and 1.8% respectively, weighed down by a glut of new apartments on the market.
In contrast, the residential housing markets of Sydney and Melbourne increased 18.4% and 13.1% respectively in the 12 months before prices peaked in 2017. Australia’s two biggest markets have since become the country’s softest markets, suffering double-digit price falls in the past year according to CoreLogic, with median house values at their lowest levels in three years.
A week before its expression of interest campaign ended on April 4, Sarah Hackett, principal of Place Estate Agents in Bulimba, sold a home on Wendell Street in Norman Park for A$6 million on behalf of the owner, Brisbane developer Tim Forrester. It last traded in March 2013 for A$3.9 million.
She said the exceptional standard of the renovation, along with its premium waterfront position and stunning city skyline views, had attracted three offers from Brisbane-based families.
“For good quality properties there are still multiple offers happening, which is a really good sign,” Ms. Hackett said.
“The empty-nester market is looking to move to areas that offer them a lifestyle connection to the water, cafes and a good quality home,” she said.“The other buyer market are families where both mum and dad are working and they have no time, so they want to be able to walk into a house that is fully done and requires no work.”
Balaam, an ultra-modern eight-bedroom home for sale on Harbour Road in Hamilton, was to test both the depth and growth in the prestige market when it went to auction in March.
However its failure to sell under the hammer hasn’t knocked the confidence of selling agent Ray White New Farm principal Matt Lancashire, who believes the three-level home, which occupies a 48.3 meter stretch of the Brisbane River, will set a new price record for the area. It last traded for A$11.8 million in 2015.
Mr. Lancashire has fielded genuine interest from five parties and his confidence was buoyed further by the success of an earlier auction in March when a waterfront mansion on Griffith Street in New Farm sold for A$7.75 million. It attracted competitive bidding from eight registered parties, selling during post-auction negotiations.
Prospective buyers interested in luxury waterfront homes are a mix of Brisbane-based locals trading up and interstate migrants, relocating to what is colloquially referred to as “the Sunshine State” for work and lifestyle.
The Australian Bureau of Statistics data show over the past decade, Queensland’s interstate migration grew by an average net figure of 11,000 people per year. It’s this figure real estate experts believe will underpin Brisbane’s forecast of moderate price growth in 2019.
“Anecdotal evidence from our agents suggests that we are seeing property buyers moving here from interstate, lured by the greater bang-for-buck proposition that is presented by our real estate,” REIQ chief executive officer Antonia Mercorella said.
“Quite simply, your real estate dollar goes further in Queensland,” she said.
Mr. Hackett said her average buyer in 2018 was 60 years old and spent A$4.1 million. This year, amid the calls she’s receiving from retirees are eager younger families from Sydney and Melbourne.
“We are dealing with two families a week who are moving back to Brisbane for cost of living and lifestyle,” she said.
“On average, they have $2 million to $3 million to spend. Brisbane is becoming a big city, a new restaurant is opening each week and there’s a lot of new development and that’s driving property,” she said.
Mr. Juresic, too, has found half his prestige buyers are Brisbane locals while the rest are coming from interstate or overseas.
“It’s an extremely liveable city at the moment,” he said of Brisbane.
“It’s not a little village anymore,” he added. “A lot of people might sell a house in Melbourne’s Toorak for A$12 million to A$14 million and they can buy a house in Brisbane that’s probably better and closer to the city for A$4 million to $5 million.”