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Riverside suburb prices surge as families rush to upgrade

Posted by on 29/06/2018

Property prices have increased in blue-chip suburbs close to the river and the CBD. Photo: Ray White The median house price in Bulimba has increased by 35.7 per cent over the past 12 months. Photo: Place Estate
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Families are upgrading in riverside suburbs like Bulimba. Photo: McGrath

Families are making the most of low interest rates and rushing to upgrade in some of Brisbane’s best suburbs close to the CBD and the Brisbane River, new figures suggest.

Domain Group data shows median house prices in the city’s most expensive areas have climbed by as much as 35 per cent over the past 12 months.

Domain Group senior economist Dr Andrew Wilson said the results were most likely caused by families buying better properties in better areas, mostly along the river.

“It’s no surprise that the inner suburbs have been the best performers, that still remains the strength of the market,” Dr Wilson said.

However, the jump in prices didn’t necessarily reflect double-digit price growth. It was more likely due to increased activity in the higher end of the market, which was pumping up median prices.

Nevertheless, rising auction numbers were encouraging. Domain Group figures, which looked at suburbs with more than 40 sales since January, showed the best-performing area over the past 12 months was Bulimba, where the median house price increased by 35.7 per cent, to just over $1 million.

Place Estate agent Phil Burley has a listing at 89 Kenbury Street, Bulimba. He said all price points have had a significant increase in value and there was lots of demand for larger blocks of land, including a 769-square-metre block he just sold for more than $1.2 million

“In the last 18 months they’ve gone ahead more than average because they’re very rare,” he said.

“There’s a character code through Bulimba but some land sales with post-war homes that can be removed have increased in price substantially.”

McGrath agent Mark Kelly has also noticed buyers asking to inspect properties before the first open home on a Saturday.

It happened recently at 114 Henderson Street, Bulimba, he said.

“That’s the sort of interest we’re getting. We’re also seeing people miss out on multiple offer situations.”

In the next suburb over to the east of Bulimba, Murarrie also showed strong growth with the median house price increasing by 23.9 per cent to $550,000.

Like Bulimba, Johnson Real Estate agent Chris Pisani said people wanted land, and a double block recently went under contract “straight away”.

“For double blocks you can’t get enough of them in this area. It seems to be the flavour of the month,” he said.

Dr Wilson pointed out there was a surprise drop in the Brisbane median house price over the past quarter and some of the lower-socio economic areas have struggled.

Inner suburbs outperformed the market and had an annual growth rate of 7.6 per cent, pushing up the Brisbane median house price to $565,000.

Demand is especially hot for blue-chip suburbs in the inner north.

New Farm’s median house price increased by 29 per cent to $1,175,000, while Ascot’s rose by 25.8 per cent, to $1.2 million.

Ray White agent Nicholas Given said he still didn’t know what the reserve would be for a listing at 209 James Street, New Farm.

“It’s an unpredictable market and in an unpredictable market you can get unpredictable prices,” he said.

“There are a lot of people in New Farm wanting to stay in New Farm. Money is cheap at the moment and so there’s a lot more buyers than sellers. There are prices being achieved now that people didn’t think were possible a year ago.”

Mr Given added there were 22 bidders for a property that sold for $1.53 million on just 304 square metres at 93 Little Chester Street, New Farm and it was probably one of the best results this year.

“The result shows there are some really solid prices happening in the market at the moment,” he said.

Cheaper alternatives

Slightly further out of the CBD, Gordon Park in Brisbane’s north experienced had a huge jump with the median house price increasing by 35.3 per cent, to $759,000.

The suburb was a cheaper alternative to New Farm, Hamilton and Ascot according to Coronis agent Lance Russell. He just sold a two-bedroom property at 28 Little Baron Street, Gordon Park, for $660,000.

“My view on Gordon Park is that it has got that feel of the Ascot, Clayfield Queenslander-type character homes but you can pick it up without the Ascot price tag,” he said.

“But it’s getting to the stage where you’d be struggling to buy something under $700,000 that needs work. To me it’s a desirable pocket because of everything that’s happened with infrastructure, the Airportlink and the Northern Busway. It’s right in the hub and you’ve got nice homes there.”

Further north the median house price of Virginia increased by 18.7 per cent, to $504,500, and the median house price of Talgum increased by 21.5 per cent, to $390,000.

On the south of the river, the median house price of Annerley increased by 21.3 per cent to $655,000.

And it seems the tide has also turned in Brisbane’s bayside suburbs. The Manly median house price increased by 29.5 per cent to $680,000, while slightly south Thorneside’s median house price increased by 20.3 per cent to $380,000.

However, First National Real Estate Bayside agent Peter McDonald said there was still a perception that bayside suburbs were too far from the city.

He said a house at 30 Saul Street less than 100 metres from the water just sold for $670,00 and represented “excellent buying”.

“People should be paying a premium to be that close to the water but they’re not,” he said.

He added most of the sales were occurring at the lower end of the market and it was still possible to find bargains there, such as a property he just sold at 57 Fisher Street, Thorneside, for $372,000.

“A lot of the older homes are being bought, demolished and going into new builds,” he said.

“But it would normally be very hard to find something for $380,000 unless you’re looking for a unit.”

The unit market

Speaking of units, results were mixed.

Cheaper suburbs including Goodna, Brendale and Upper Mount Gravatt showed strong price growth, along with the aspirational suburbs of Newstead, Ascot and Ashgrove.

But although Bulimba house prices had the best annual growth rate, the median unit price in Bulimba fell by 12.3 per cent, down to $490,000.

The median unit price in Paddington, Toowong and East Brisbane also dropped, by 10 per cent, 6.4 per cent and 5.9 per cent respectively.

Mr Kelly said new stock in Brisbane’s inner suburbs was creating lots of supply and probably explained why the unit market in some of Brisbane’s best suburbs had dropped.

“That would naturally dampen the existing unit market,” he said.

“Buyers (of units) are spoilt for choice.”

Dr Wilson added other local factors might also be hurting the unit market.

“There has certainly been a weakening sharemarket and that reflects an underlying fragility in sentiment, so we need to keep an eye on that,” he said.

“There are still local issues in that the Brisbane economy needs work and unemployment is over six per cent.”

Domain Group results

Over the past 12 months ending September, 2014, the 10 suburbs with the strongest increase in the median house price were Bulimba, (35.7 per cent to $1,007,500), Gordon Park, (35.3 per cent to $759,500), Manly, (29.5 per cent to $680,000), New Farm, (29 per cent to $1,175,000), Ascot, (25.8 per cent to $1.2 million), Murarrie, (23.9 per cent to $550,000), Taigum, (21.5 per cent to $390,000), Annerley, (21.3 per cent to $655,000) and Thorneside, (20.3 per cent to $655,000).

The 10 suburbs with the strongest increase in the median unit price were Goodna, (67.2 per cent to $311,000), Upper Mount Gravatt, (39 per cent to $490,000), Brendale, (21.5 per cent to $334,000), Newstead, (19 per cent to $885,000), Annerley, (17.9 per cent to $445,000), Ascot, (13.4 per cent to $422,000), Bowen Hills, (12 per cent to $442,500), Clayfield, (11.7 per cent to $391,000), Fortitude Valley, (11.4 per cent to $462,500), and Brisbane City, (11.1 per cent to $500,000).

This story Administrator ready to work first appeared on Nanjing Night Net.

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