Brisbane has been ranked the weakest property market in the country, but home prices continue to defy pressure to fall, holding up stubbornly thanks to one key factor.
Hotspotting’s Winter 2023 Price Predictor Index ranked Brisbane as the weakest sales market in Australia with only 12 suburbs named as rising, and a whopping four out of five now in negative territory.
Index head researcher and Hotspotting head, Terry Ryder, said “Brisbane is one of the weakest markets in the nation and the worst Brisbane market we have recorded in the eight years of our quarterly surveys of sales activity”.
But the Queensland capital was defying the odds that lower sales numbers mean prices will also fall – thanks to real estate listings continuing to fall way short of demand, keeping prices buoyant.
“The most remarkable thing about this is that Brisbane prices are not falling,” he said in the report. “Individual suburbs have experienced price decline recently but overall the median house price (according to several research sources) is holding up.”
“This confirms a factor evident elsewhere in Australia: that the low level of sales activity is partly explained by the low number of listings of properties for sale. It’s as much about reluctant vendors as it is about reticent buyers.”
Hotspotting Price Predictor Index has often demonstrated that rising sales activity leads to price growth, “as it depicts rising demand – and areas where sales are falling tend to see prices falter or fall,” Mr Ryder said.
Hotspotting General Manager Tim Graham added that “currently, there are areas across Australia where sales activity is weak but prices remain strong – because there is a shortage of listings of properties for sale”.
“This is the most common complaint from property professionals and investors throughout the nation – there is demand from buyers but a serious shortage of stock for sale. Examples include Brisbane and Regional Queensland, where sales activity is weak but prices are holding up stubbornly.”
Some of regional Queensland’s previously buoyant centres were seeing sales subsiding, with locations with negative rankings outnumbering positive ones by two to one now.
“Prices are stubborn however,” Mr Ryder said, “reflecting – again, similar to Brisbane – the shortage of stock on the market”.
Mr Ryder said across the busiest markets in the country – Perth and Adelaide – the strongest
activity was coming out of cheaper areas with affordability a key attraction for both homebuyers and investors.
“In Melbourne and Sydney, we’re seeing very different trends. In the biggest cities, the strongest markets tend to be the more expensive areas where interest rate levels are less impactful because there are many cash buyers, while the cheaper outer-ring precincts are struggling,” he said.
Article source: Queensland Property Investor
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