Queensland buyers have started chasing affordability, with new data showing unit price increases have started to outpace freestanding homes.
According to the Real Estate Institute of Queensland (REIQ), unit prices jumped 3.92 per cent to $530,000 over the last quarter, ahead of the 2.07 per cent increase in house prices.
Unit prices are also higher over the past 12 months, up 6.32 per cent, compared to 3.91 per cent for houses.
REIQ CEO Antonia Mercorella said unit price growth seems to be “awakening from a long slumber”, as people adjust their expectations and use them as stepping stones into the housing market.
“It’s not surprising that units are gaining popularity due to their relatively affordable price point when budget-conscious buyers are wary of rising interest rates and cost of living,” Ms Mercorella said.
“When once upon a time you could find more affordable freestanding houses to buy around the half-a-million dollar-mark with a reasonable commute to the city, we’re now hearing that first home buyers are turning to apartments and units instead.”
She said unit prices in several areas had almost double-digit growth over the quarter.
“For instance, Greater Brisbane’s unit market continues to go from strength to strength representing great value and growth in good proximity the state capital,” Ms Mercorella said.
“Logan’s unit market in particular was a standout with 9.17 per cent growth over the quarter and a solid 11.11 per cent growth over the year to $350,000.”
In terms of quarterly growth performance, the Rockhampton unit market was the strongest at 19.21 per cent – however, this was on the back of just 39 listings.
Noosa also had an impressive 9.47 per cent growth based on 92 sales.
Other notable unit market performers over the quarter were Logan (9.17 per cent), Mackay (8.75 per cent), Toowoomba (7.75 per cent), and the Sunshine Coast (7.26 per cent).
In terms of the house market, the strongest quarterly growth was in Noosa (6 per cent), Toowoomba (4.52 per cent) and Ipswich (3.60 per cent) – arguably representing the best of Queensland’s lifestyle, regions, and city outskirts.
Above average quarterly growth was also seen in Fraser Coast (2.68 per cent), Cairns (2.61 per cent) and Townsville (2.47 per cent).
Conversely, the Mackay, Rockhampton, and Gold Coast’s housing markets barely wavered over the quarter, while Bundaberg retreated slightly (down 2.06 per cent).
Gladstone experienced a more substantial dip over the quarter, based on 350 sales, which may be more of a reflection of the type of stock coming to market.
Ms Mercorella said interest in regional Queensland’s housing market was rising as a relatively affordable choice and, in most cases, with attractive annual growth.
“Those seeking value for money are finding it in our regional economic powerhouses – Toowoomba and Townsville,” she said.
“You’re looking at an annual median house price of $530,000 in Toowoomba and just over $400,000 in Townsville – well below Greater Brisbane’s $760,500 median price point.”
She said the shortage of sales listings had become somewhat of a catch 22 situation in the Sunshine State.
“The biggest challenge at the moment is people’s reluctance to sell and make the jump to their next property,” Ms Mercorella said.
“Real estate agents are telling us that people do want to sell their properties, but they’re also held back by concerns about what they are going to be able to buy back into in such a tight market – so it’s a frustrating situation for so many.”
Looking at annual growth, the regions really shone, with double-digit growth in Rockhampton (11.79 per cent), Bundaberg (10.71 per cent), and Toowoomba (10.07 per cent).
Townsville also had a strong 4.49 per cent uptick year-on-year.
Ms Mercorella said there had been a few small dips over the quarter, as well as some prices retreating slightly when comparing year-to-year, but it was important to remember we were coming off record highs.
“It’s not really comparing apples with apples when trying to draw parallels with a particularly remarkable period of time in real estate,” she said.
“We are back to a consistent, ‘steady as she goes’ market which means there will be some expectation management needed for both sellers and buyers.
“On one hand, sellers may need to temper their expectations somewhat from the crazy highs, but equally, buyers who had hoped a bargain was just around the corner will be sorely disappointed as the shortage of stock is keeping the competition hot.”
