Rising interest rates, soaring rents and affordability pressures are tipped to push a bigger pool of buyers back into Queensland’s apartment market.
Demand for units is surging and industry experts believe the return of investors driven by the rental crisis will push up apartment prices. PropTrack senior economist Eleanor Creagh said demand for houses outshone units during the pandemic as people opted for more space, but now demand for units was bouncing back.
In March, inquiries for houses and land slipped compared to a year ago, but the volume of unit inquiry is 16.6 per cent higher year-on-year, according to the data. “With the return of overseas migration and universities resuming in-person classes, investors are eyeing up the opportunity to purchase a unit,” Ms Creagh said.
Colliers Queensland residential director Andrew Roubicek said the price difference between houses and apartments in Brisbane had reached 49 per cent — the greatest differential in two decades. Mr Roubicek believes the city’s apartment market is in for a significant price increase in the second half of 2022. “We expect surge in demand from investors as the rental vacancy rates continue to fall to less than one per cent and rental yields approach five per cent. “This increase in demand will have a significant impact on the second-hand apartment pushing up prices reflecting the price of a new apartment.”
Kollosche agent Harry Kakavos, who sells prestige real estate on the Gold Coast, said skyrocketing building costs would also drive up apartment prices.
Hotspotting director Terry Ryder said units would start to become “a very attractive option” given the price gap between units and houses. “I think we’ll see more demand coming to apartments as the desired choice because of affordability, although there are plenty of places where apartments have had exceptional growth in median prices,” Mr Ryder said. “100 per cent of Brisbane suburbs have had house price growth in the past 12 months and 93 per cent of suburbs with apartment markets have also grown.”