Brisbane Property Market Update September 2021
Brisbane Property Market Update September 2021 from Alistair Kelsall Brisbane Buyers Agent. A look at the Brisbane property market from the ground, what I am seeing, what is happening and why are property prices increasing so much. This Brisbane Property Market Update is from my own experiences as a Brisbane Buyers Agent and does not include any data other than actual results.
The Brisbane property market is seeing rapid price increases in properties in many suburbs of Brisbane right now. The reason we are seeing such dramatic increases in property prices is due to 3 major factors:
- Market Phase
- Stock Availability
- High Number of Buyers
I will endeavour to explain each subject to give you a true understanding from a ground-level perspective.
Brisbane has been in a Seller’s Market Phase now since the begging of the year. A seller’s market phase is when market conditions favour the seller of a property, not the buyer, meaning the seller is at an advantage and can command a higher price for the property being sold. In truth, this is the wrong time to be a buyer as we are around 9 months into this market phase and as stock levels continue to deteriorate, property prices rise. It comes down to the simple formula of supply and demand.
Stock availability is the next factor that is affecting property prices in the Brisbane and South East Queensland region. With fewer numbers of properties for sale in the market combined with a high number of buyers, sellers to a degree are asking more for their homes than the normal capital growth rate would dictate. Again the factor of supply and demand comes into effect, more buyers with fewer properties, places a higher level of demand on the available homes which leads to price increases
High Number of Buyers
This is the actual factor that is affecting the high price increases we are seeing in property sales throughout Brisbane and the South East Queensland region. It is not uncommon to see around 40 groups through an open home. If you talk to these people and listen to their stories about trying to buy a house right now, you will hear a very common experience. People are attending open homes and placing offers on properties over and above the asking price. Because they miss out on a property and are becoming desperate to purchase a home, they are submitting much higher offers to increase their chances of securing a property. It is this factor that is leading to the price increases we are seeing.
Why Are There High Numbers of Buyers
The reason there are such high numbers of Buyers in the Brisbane property market right now is simple, low-interest rates. It is very cheap to borrow money right now and this is leading to more and more people looking to invest in real estate. This will not change till we see an increase in interest rates.
If you have worked with me or are an existing client of mine, you would know that I have been targeting a particular street in Doolandella called Fred Pham Crescent. I and a number of clients have been very fortunate to have a good agent in the area who has given me access to off-market properties, so I haven’t had to buy a property on the open market.
One of these properties I will use as an example of the current market effects. The property below was purchased in June this year, off-market for $535,000. It’s a 4 Bedroom 2 Bathroom home on 535m2 of land overlooking parklands.
On Friday night I attended an open home at 5 Fred Pham Cres. A very similar but in my opinion inferior property being 4 Bedrooms, 2 Bathrooms on 534m2 of land. All in all very similar properties with the main difference being the layout of the homes and the location. My client’s property in Fred Pham overlooks parklands whereas 5 Fred Pham has homes on the opposite side of the road which decreases its potential value.
The open home was attended by at least 40 people with more coming at the time I left and another open home booked for the next morning. I could see what was going to happen, the other attendees had been trying to secure a home for a long period of time, 6 months in some cases and were frustrated by continually missing out to others bidders. This factor alone is the reason buyers are willing to submit higher than normal offers for a property rather than miss out again and is the cumulation of all the factors above that is leading to the results.
Right now this property above has an offer of over $600,000 and is waiting for the finance and due diligence conditions to be filled but it clearly shows you what is happening in the Brisbane property market.
How to Purchase a Property in a Sellers Market
The most successful method of purchasing a property in the current market conditions is to purchase off-market. If you have an agent with a potential listing it is very advantageous for that agent to have a buyer lined up. This is something that is an important part of my business and over the last 20 years, I have been able to develop some very strong relationships with very good agents throughout the Brisbane region who will let me know what they have coming up. From the results of the previous off-market sales, I have been able to save my clients between $10,000 to $20,000 off the potential sale value of the home if it were made available to the general public. These properties are listed on this website in the for sale section. CLICK HERE TO VIEW
The second method of buying a property in Brisbane in the current market conditions is to use the methods I have used all along and that is to identify the next popular suburbs. As I mentioned I have always promoted Durack and Doolandella as potential future Brisbane Hot Spots and we are now in the phase where the suburb has become extremely popular and the prices are rising and getting close to the top of the property price cycle.
When Will This Market Phase End
This market phase will not end till the RBA or the Banks increase their interest rates. That is the only factor that will slow down the market. Right now it is very cheap to borrow money which is leading to the high number of potential buyers in the market pace.