Million-dollar territory: Queensland leads home price growth

Aerial View of Brisbane Financial District

Brisbane was the only Australian capital city to notch home price growth in January.

Shock new figures show it now costs about $1m to buy a mid-range home in vast tracts of South East Queensland, with other parts of the state also seeing major growth spikes.

Brisbane was the lone star among Aussie capitals’ home price growth in January, with its house median now just $21,000 shy of $1m – a level the Gold and Sunshine Coasts have already hit, as the regions boom.

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Prop Track senior economist Eleanor Creagh said if interest rates rise, Brisbane will see another major rise in prices, though not as extreme as the pandemic era numbers.

The PropTrack Home Price Index, released Saturday, saw Brisbane home prices eke out a 0.08 per cent rise in January to a new peak median level of $871,000 for all dwellings, after houses hit $979,000 and units went to $745,000.

But while Brisbane remains one of the strongest housing markets in the country with prices up 10.44 per cent year-on-year, and a whopping 84 per cent higher than five years ago, parts of regional Queensland are flying even higher median prices led by the two SEQ coasts.

The Gold Coast’s median house price is now $1.139m with units at $785,000 – heights Brisbane is yet to reach though things may change with the Olympics on the horizon.

Its median price for all dwellings of $967,000 could not beat that of the Sunshine Coast though which hit $1,004,000 as the mid range for all properties after annual growth of 6.2 per cent.

Overall the Queensland regional home price rose 0.02pc in January, taking the annual to a 9.31 rise.

SEQ’s million-dollar credentials:

Sunshine Coast $$1,004,000 (all dwellings)

Gold Coast $1.139m (houses)

Brisbane $979,000 (houses) $2lk away

(Source: PropTrack)

The highly popular Gold Coast has already surpassed the million dollar median house price along with the Sunshine Coast.

REA Group senior economist Eleanor Creagh does not believe Brisbane’s lone star status as the growth capital will last long if interest rates are cut come February, with even more predicted through the year.

“Brisbane has been a pillar of relative outperformance over the past couple of years, so it’s not necessarily too surprising to see prices continuing to lift there”.

“It’s likely that these price falls that we’re seeing elsewhere are going to be pretty short lived, with interest rate cuts on the horizon.

“It looks like the inflation data this week really opened the door for the Reserve Bank to begin their rate cutting cycle in February, and with interest rates moving lower, that’s going to begin to increase borrowing capacities. That kind of improvement in affordability and likely confidence, will probably drive a reversal in the price falls that we’re seeing elsewhere, and re-acceleration in price growth in Brisbane and Perth.”

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Better than expected inflation numbers mean homeowners could see some interest rate relief in February.

She said any rises though would not be as high as pandemic era gains. “It’s still unlikely that the pace of growth will really outpace the strong growth that we’ve seen over the past few years.”

Ms Creagh said “the Gold Coast has been a relative outperformed over the past couple of years”.

She expected to see “a continuation of the trend that we have been seeing”.

“The Gold Coast is continuing to record a pretty robust pace of growth, with prices up just a little over 7 per cent over the past year, but still slightly slower than some of those other regional Queensland areas where homes are more affordable in comparison.”

“Strong population growth, infrastructure investments, the Olympic Games, are all contributors driving strong growth, but the pace of growth is probably going to be slightly more modest than the growth we’ve seen over recent years.”

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Townsville harbor view on the Yacht Club Marina, The Strand and Castle Hill

Townsville is the strongest performing property market in Australia.

Townsville is absolutely firing – up 2.12 per cent over the quarter and a massive 25.22 per cent over the year to $516,000.

“Townsville is the top performing market in the country over the past year. Strong population growth and relative affordability is likely a driver behind that increase,” Ms Creagh said.

“Prices in Townsville were up just slightly over 25 per cent over the past year, but the median value is only a little over half a million dollars. Relative affordability is a clear driver behind some of that relative strength that we’ve seen in Townsville”.

Cairns was also seeing strong growth, she said – with quarterly growth of 1.24 per cent and an annual rise of 9.87 per cent pushing the median price for all dwellings to $572,000.

“Prices are up close to 10 per cent over the past year. It’s had pretty strong growth over the past quarter, although not quite as strong as Townsville and the Wide Bay region.”

“Continued strong demand, population growth and relative affordability are likely drivers of that strong price growth in Cairns.”