Queensland Property Market and COVID-19: Some stats show it’s actually better than you may think…
It’s fair to say we’ve all had a pretty rough start to the year, first the whole country was on fire and now a global pandemic. We’ve had to cancel holidays, weddings have been postponed, our interstate borders have been closed and having to social distance our family and friends. With our international borders being closed, Australia’s overseas migration is forecasted to shrink by 85% in the next 12months! This will likely impact Australia’s population growth and then may have an impact on housing demand as well as property and rent prices.
So, how does immigration impact the property market? To put it simply, when people move to a new area they generally rent to ensure it’s right for them, or they may even build or buy. With the major drop in migration due to COVID-19, this could result in a big drop in property and rental prices due to lower demand. Both Melbourne and Sydney rely heavily on migration and it’s predicted these markets will be hit the hardest.
The brighter side to all of this is that interstate borders will not be locked down for much longer. In the financial year of 2018/19, Brisbane had the highest rate of net internal migration amongst all the major cities – gaining 15,194 new residents. Regarding smaller regions, Queensland’s Sunshine Coast had the highest net internal migration too. Not only that, but out of the top 10 smaller regions for internal migration, 5 of those regions are in Queensland and the rest were either in VIC or NSW. Queensland’s lower cost of housing is likely the driving factor for migration and of course, it is the sunshine state!
When restrictions came into full force most businesses only had 24hours notice, this saw onsite auctions ceased and public open homes suspended. Fortunately, businesses quickly adapted by adopting an e-commerce business model. Having virtual homes inspections, live-streamed auctions and real estate agents working remotely. Even with all this happening, clearance rates were actually higher than before the lockdown. Brisbane house values increased by 0.3% in April and had a 0.6% in March, as calculated by CoreLogic. So being a homeowner is not only possible during this uncertain period, if anything it could be working towards your favour!
With government stimulus packages for first home buyers and an increase in migration within Queensland, the property market is stronger than you might think. Rates are having never been as competitive as they are at the moment and due to the curve being flattened much sooner than expected.
All that being said, if you think your dreams of becoming a homeowner has been shattered due to the pandemic, it thankfully may not be the case. The stats speak for itself!
Steve Foulis is a qualified finance and mortgage broker and the owner of Money Quest Park Ridge.
You can contact him for more information at:
p: 0433 366 550