Hotspotting

We’ve just put together the new 2021 edition of our most popular report, the National Top 10 Best Buys.

It’s very timely – because we’re coming to the end of the most remarkable year most of us have experienced …

And, in real estate terms, we’re about to enter what I expect to be most dynamic year ever.

We’re ending 2020 with prices growing in most locations across Australia and building towards a nationwide real estate boom, I believe.

Because there are so many vibrant markets across Australia right now, I’ve found it extremely difficult to make the necessary choices for this new edition of the Top 10 Best Buys report.

There are so many genuine candidates for inclusion in capital cities and in regional areas around the nation.

It means that many worthy locations, places that I expect to show good growth in 2021 and beyond, have not made the cut.

But I’ve come up with a Top 10 list that includes a mix of big cities and regional centres – with locations in five different states.

They’re all places with identifiable strong growth drivers.

They’re all places that are representative of the major trends that are sweeping the nation, including the Exodus to Affordable Lifestyle and the Infrastructure-led Property Boom that’s coming.

It’s not only our most popular report – I expect this edition to be most important we have published, given everything I expect to happen in the year ahead.

We’ve just published our two major hotspots for Queensland – Top 5 Brisbane and Top 5 Regional Queensland – at a time when many of these markets are on the cusp of a real estate boom.

The Brisbane market has shrugged off the impacts of the pandemic and is in its strongest position to generate price growth for five years. This is starting to translate increasingly into evidence of uplift in property values.

Our analysis of sales activity across the Brisbane metropolitan area has identified 56 suburbs with rising momentum, the highest number since late in 2015 and double the number identified in our survey six months ago. The numbers show an all-round improvement in the Brisbane market, with a sharp reduction in the number of declining or danger markets.

Brisbane’s affordability relative to the biggest cities is helping to boost its market, with more people relocating to South-East Queensland from Sydney and other parts of Australia. Brisbane is a natural beneficiary of the Exodus to Affordable Lifestyle trend and is also benefiting from strong consumer confidence as a result of the success in controlling Covid-19.

We’re also seeing very positive trends in the state outside of Brisbane. Indeed, this is the strongest Regional Queensland market in the six years we have been conducting our quarterly surveys of sales activity and prices. The number of rising markets is the highest recorded, by a considerable margin, and property values are growing.

We have identified 72 locations with rising sales activity, a remarkable result in the year of the pandemic. Locations across the state are benefiting from the Exodus to Affordable Lifestyle and/or the improvement in the resources sector.

Vacancies are ultra -ow in most of these places. There are seven regional cities with five or more suburbs with forward momentum in sales activity: the Sunshine Coast, the Gold Coast, Toowoomba, Mackay, Rockhampton, Gladstone and Townsville. These cities, plus smaller regional centres like Gympie, Emerald, Warwick, Kingaroy and Dalby, all have markets trending in the right direction for sustained price growth.

The Sunshine Coast is again the standout location, but other regional markets are emerging, notably the important inland city of Toowoomba. And we are seeing recovery in resources-related centres which have spent several years in downturn, including Gladstone, Mount Isa and Emerald.

So the best way to find out which are the best markets to focus on in Brisbane and Queensland – and why – is to get our Queensland Bundle. It includes Top 5 Brisbane and Top 5 Regional Queensland and is a great way to make some decisions about where you might buy in 2021.

Seven of the eight capital cities delivered growth in their house prices during 2020, according to the latest data from CoreLogic.

The price increases were highest in Darwin, which grew 12% last year, followed by Canberra’s 8.5%, Hobart’s 7.7% and Adelaide’s 6%. Melbourne was the only city to record a decline in its median house price, down 2% in 2020.

Sydney (up 4%), Brisbane (4.6%) and Perth (2%) all recorded moderate growth in their house prices, in a year when most of the nation’s cities defied the pandemic and its negative economic impacts.

The average growth figure for the combined capitals was reported by CoreLogic as 2.6%, a number that seems unreasonably low given that six of the eight cities had growth considerably higher than that.

Apartment markets did not fare as well as houses, with four cities delivering price growth, two recording no change and two (Brisbane and Sydney) having small declines in their median un it prices. The combined cities average was a rise of 0.2% in 2020.

So the capital cities did pretty well in the pandemic year, especially the smaller ones …

BUT …

Regional property markets across Australia out-performed the capital cities – and by a considerable margin.

CoreLogic data shows that the result for the Combined Regions was a rise of 7% for houses and 6% for units, compared to 2.6% and 0.2% for the Combined Capital Cities.

House prices rose 12% in Regional Tasmania (compared to 7.7% in Hobart),

8.8% in Regional NSW (compared to 4% in Sydney),

7.8% in Regional South Australia (compared to 6% in Adelaide),

7.3% in Regional Queensland (compared to 4.6% in Brisbane) and

5.5% in Regional Victoria (compared to a 2% decline in Melbourne).

Unit markets also did well in the regions, with price increases headed by South Australia (up 11.7%) and Tasmania (up 10.5%).

NSW, Victoria and Queensland all recorded unit price rises between 5.5% and 6.5% in the regional areas.

The only regional market to record price decline was Western Australia, which dropped both for houses and for units.

So, overall, an amazingly positive result for property prices in a year that threw up all kinds of hurdles – and in defiance of the negative predictions by economists and journalists.

All this was achieved without a great deal of involvement from investors.

And that’s one of the things that will be different this year.

Stand by for a big big year in residential real estate in 2021.

The year of the pandemic has been a very good advertisement for residential property as an asset class. And our new Summer edition of The Price Predictor Index demonstrates the point well.
Our analysis of sales activity and prices in capital cities and regional markets across Australia has revealed a series of highly positive outcomes – pointing to strong price growth in 2021.
Many jurisdictions have had the best results on sales trends we have seen in the six years we have been conducting our quarterly surveys, including Sydney, Perth, Regional NSW, Regional Queensland and Regional WA. Brisbane has had its best result since 2015.
Other precincts have done outstandingly well with prices. In Regional Victoria, 92% of suburbs and towns have had growth in their median prices in the past 12 months. In Hobart and Tasmania, 90% of locations have delivered growth, while 80% of towns in Regional South Australia have grown their prices and 81% of Canberra suburbs have had uplift.
Looking at it from another perspective, Canberra and Regional Tasmania have both had some level of house price growth in every one of the past nine months (i.e. since February, when the pandemic struck the nation), while Adelaide, Regional Queensland and Regional NSW have all had growth in eight of the nine months.
One of the dominant themes in this edition of The Price Predictor Index is the trend of people relocating
from the biggest cities to more affordable locations that offer lifestyle. This trend has been gathering speed for a number of years and has been enhanced by the pandemic period,
with its enforced lockdown phases. Regional areas in particular have attracted increased demand as a result of this pattern.
In the most populous states - NSW, Victoria and Queensland - the regional jurisdictions have out-performed their capital cities on the number of suburbs or towns with rising sales activity.
Sydney had a record 93 growth markets in this quarterly survey, but Regional NSW had more, with 116. Melbourne has been outdone by Regional Victoria and Brisbane has been bettered by Regional Queensland. Collectively in those three states, the regional jurisdictions had a total of 223 growth markets, compared to 174 growth suburbs in the capital cities.
Regional towns have also excelled in South Australia, Tasmania and Western Australia. Sales activity is rising and prices are responding.
What started as a steady drift of people moving from the big cities to the smaller cities or to regional areas
has turned into something approaching a stampede.
We know from other research that first-home buyers are one of the most active cohorts in the market.
The lending data shows the market share of FHBs is the highest in more than 10 years. This is reflected in the results of this quarterly survey. In many of our capital cities, the best results in terms of the number of suburbs with upward momentum have been the cheaper areas.
Those are just some of the highlights of this new Summer edition of the Price Predictor Index.
It’s one of our most popular reports because it provides a reliable forward indicator of what’s likely to happen with property prices in every significant suburb and town across Australia. It includes our National Top 50 list of Supercharged suburbs and our National Top 50 list of the most consistent markets in the nation. It highlights the Top 10 municipalities in Australia in terms of uplift in sales activity heading towards strong price growth.

So get yourself a copy of the new Summer edition of the Price Predictor Index to find out what’s going to
happen in real estate across Australia in 2021.

Melbourne’s unique situation in the year of the pandemic has delivered a markedly different outcome to many other locations.

The second wave lockdowns and restrictions have meant that the Melbourne market has had to deal with difficulties that other cities and regions have not experienced.

But, despite everything, the Melbourne market has managed to get through to December without any major damage to prices or consumer sentiment.

The latest price data from CoreLogic suggests that in the 12 months to the start of December, the median unit price has risen marginally – 0.4% - and the median house price is down slightly, just 1.5%.

But the latest figures out this week from SQM Research suggest that houses have risen 1.8% in the past 12 months and units have increased 4.5%.

Those are remarkably strong statistics for a market that has experienced all that has afflicted Melbourne in 2020.

So, against that backdrop, I’m expecting a strong performance from Melbourne markets in 2021.

We’ve already seen, in the short time since the restrictions were lifted by the State Government, evidence of busy activity in property markets and some strong sales.

So, as we contemplate what might happen in Melbourne in the New Year, where should investors be buying?

To answer that question, this week we have published our new Top 5 Melbourne Hotspots report, to provide our best insights into what to expect in 2021 and where best to focus your attention.

I think Australia will experience a national real estate boom in 2021 and Melbourne will be part of it.

To find out more, have a read of our new 2021 edition of Top 5 Melbourne hotspots.

In this short episode,  Terry discusses what is happening in the property market right now with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

In this short audio, Terry discusses the idea of diversifying when an investor is unsure of the area, with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

Every capital city and every regional market recorded house price growth in November, according to the latest data from CoreLogic.

Nationally house prices rose 1.1% in November, led by a 1.4% in regional markets which continue to out-perform the capital cities.

Apartment markets rose 0.2%, again headed by a 1.4% increase in the regions.

The results continue the strong performance of most property markets across the nation during this year of the pandemic.

Of the 15 major market jurisdictions in Australia (eight capital cities and seven regional markets), 13 have recorded house price growth in the past 12 months, the only exceptions being Melbourne and Regional WA.

All of the markets except Brisbane have also recorded annual growth in the median apartment prices.

In November, house price growth was led by a 2.2% rise in Canberra, with Regional Tasmania up 1.8%, Hobart up 1.7% and Darwin rising 1.6%.

The annual growth in house prices has been headed by Regional Tasmania (up 10.6%), Darwin (up 9.1%), Canberra (up 7.8%) and Regional NSW (up 7.4%).

Regional markets continue to outdo the capital city markets. The growth in house prices has been greater in the regions in the past month, the past quarter, the year to date and in the past 12 months.

In the past year, regional house prices on average have risen 5.9%, compared to 2.9% in the capital cities. Regional unit prices on average are up 4.7%, compared to 0.8% in the cities.

And of course, individual markets have done considerably better than those average numbers.

So the CoreLogic data published today is the latest in a series of reports which show how well real estate markets have done in the year of the pandemic.

2020 has been the best possible advertisement for residential real estate as an asset class.

It was predicted by many that prices would collapse this year, but in virtually every capital city and regional market, they have risen.

And next year, I’m expecting similar but even more so.

The nation-wide property boom I’m predicting is already under way in many locations across the nation.

Brisbane In Strongest Position In 5 Years To Deliver Price Growth

The Brisbane market has shrugged off the impacts of the pandemic and is in its strongest position to generate price growth for five years. This is starting to translate increasingly into evidence of uplift in property values.

Our analysis of sales activity across the Brisbane metropolitan area has identified 56 suburbs with rising momentum, the highest number since late in 2015 and double the number identified in our quarterly survey six months ago.

The numbers show an all-round improvement in the Brisbane market, with a sharp reduction in the number of declining suburbs and a reduction also in the number of danger markets.

Brisbane’s affordability relative to the biggest cities is helping to boost its market, with more people relocating to South-East Queensland from Sydney and other parts of Australia. Brisbane is a natural beneficiary of the Exodus to Affordable Lifestyle trend and is also benefiting from strong consumer confidence as a result of the success in controlling Covid-19.

In the six years we have been conducting our quarterly surveys of sales activity and prices, it has been common for northern Brisbane to dominate the positive results – and that is certainly the case in this Summer 2020 survey. Of the 56 suburbs with rising sales activity, 12 are in the Brisbane-north precinct of the Brisbane City Council area and 13 are in the neighbouring Moreton Bay Region.

While the most prolific markets are in the north, there also has been a notable revival in Logan City in the south. The municipality is the urban bridge between Brisbane City and the Gold Coast and traditionally attracts buyers seeking cheap real estate and good infrastructure.

There are growth markets in other parts of the Greater Brisbane area as well – Brisbane-inner (4), Brisbane-east (5), Brisbane-south (3) Brisbane-west (3) and Redland City (5) all have some suburbs with rising sales activity.

Our analysis of price trends across the Brisbane metropolitan area shows that most suburbs have recorded house price growth in the last 12 months, but an even higher percentage have had growth in the most recent quarter.

This again shows that the city has done well through the pandemic period.

Our latest Top 5 Brisbane Hotspots include the areas that we have identified as those with the best prospects for returns and future capital growth. These recommendations are based on exhaustive analysis of the data and Terry Ryder’s 35+ years of experience as a property analyst.

Discover Terry’s recommendations in the Top 5 Brisbane Hotspots.

In this short video, Terry discusses the possibilities of buying an investment property in our own neighbourhoods with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.