Saturday, July 24th, 2010
During a recent review of South East Queensland conducted by property research house SQM Research, South Brisbane has emerged as one of the region’s suburbs most likely to show above-average growth in both rental yields and capital growth over the next six years.

According to the study, median unit prices in South Brisbane are due to rise to $455,000 in 2011, increasing to $645,000 by 2016. This represents compound growth of 7% for the next six years, significantly more than the expected growth rate for Brisbane overall, which sits at just 6.2%.

Additionally, median rents for South Brisbane are projected to rise by 6.3% per annum during the period, compared to the Brisbane average of 6.0%.

SQM Research Managing Director Louis Christopher said it’s an unusual scenario for an area to show above average projected growth in both rental returns and capital growth, which may offer investors the opportunity for “double-dipping.”

“Although there are no guarantees, taking into account rental yields and capital growth projections and assuming normal economic conditions prevail, we could expect total returns for South Brisbane to be somewhere in the low double digits” Christopher said.

While other areas of Brisbane may experience oversupply issues, Christopher says the South Brisbane growth projections are underpinned by an expected accumulated undersupply of more than 4000 dwellings by 2016.

“Population projections forecast an increase of 6% per annum compared to the 30 year Brisbane average of 2.4%. Mooted development in the area until 2016 is likely to result in an undersupply, at least over the short to medium term.”

“The challenge will be for developers and planners to ensure supply is adequate to meet this increased demand, while at the same time, not overbuilding, which would cause an oversupply situation regardless of demand.”

“Nevertheless, South Brisbane is a likely candidate for outperformance in Brisbane and across South East Queensland.”

Contact Profile

SQM Research

SQM Research is an independent property research house which specialises in providing accurate property related research and data to financial institutions, property professionals, real estate investors and the media.

It is owned and operated by one of the country’s leading independent property analysts, Louis Christopher.

For six years Louis was Head of Research and then General Manger of Australian Property Monitors before leaving the firm to launch SQM Research and Adviser Edge Property, a leading fund manager ratings house specialising in ratings for agribusiness, structured products and property.
Louis Christopher
P: 0410667651


property, south east queensland, hot spots, real estate, property projections


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