Hi all, there are so many threads here from investors looking to buy in Brisbane, and I am one of them but I have concerns that the Brisbane economy is following Perth's recent path..noting Queensland/Brisbane has a similar (but smaller) reliance on mining for its economic stability.
I attended a bank Chief Economist presentation last week and he noted the following in relation to Queensland:
1. Consumer spending growth per capita (per head) is zero. By comparison NSW is above +2% and WA -1%.
2. Labour income per capita is down 2.3% (NSW up 0.1%) in past 12 months
3. Unemployment is on an upward trend, currently approx. 6.7% - above national average. WA is approx. 5.6% and rising. NSW and VIC both around 6%.
Rising unemployment, slower spending and lower incomes point to a weak demand story for Brisbane which may well continue with forecast 10%+ reductions in mining investment expected over the next few years.
From a purely property perspective, it was interesting to note:
1. Dwelling approvals at record levels across Australia - approx. 230,000 annualised but high rise unit approvals increasing from approx. 2200 per month around 9 months ago to 6300 per month today (mostly driven by VIC and NSW).
2. While the current approval levels almost cover Australia's current housing shortage (approx. 240,000), problems exist across the States given the NSW shortage is 60% of the nation's shortage and VIC's shortage is only 3% of the nation's shortage. I would be very concerned on this information investing in new build city centre Melbourne apartments.
3. Brisbane's house price growth is close to zero and the growth rate has substantially slowed in the past 12 months (6 month growth rates annualised). WA down approx 3%. They used CoreLogic RP Data, APM, ABS and Residex as sources.
I understand that the Brisbane median price is way below the Perth, Sydney and Melbourne (no sustained post GFC and floods recovery) but what other factors makes so many Somersoft investors look to Brisbane as the next market to take off. Economic factors make me concerned that 2012 was the time to invest there and its period of reasonable growth has past or is passing. If there are property fundamentals that make Brisbane still attractive despite its deteriorating economic environment, I would welcome any comments.
Thanks
GG
I attended a bank Chief Economist presentation last week and he noted the following in relation to Queensland:
1. Consumer spending growth per capita (per head) is zero. By comparison NSW is above +2% and WA -1%.
2. Labour income per capita is down 2.3% (NSW up 0.1%) in past 12 months
3. Unemployment is on an upward trend, currently approx. 6.7% - above national average. WA is approx. 5.6% and rising. NSW and VIC both around 6%.
Rising unemployment, slower spending and lower incomes point to a weak demand story for Brisbane which may well continue with forecast 10%+ reductions in mining investment expected over the next few years.
From a purely property perspective, it was interesting to note:
1. Dwelling approvals at record levels across Australia - approx. 230,000 annualised but high rise unit approvals increasing from approx. 2200 per month around 9 months ago to 6300 per month today (mostly driven by VIC and NSW).
2. While the current approval levels almost cover Australia's current housing shortage (approx. 240,000), problems exist across the States given the NSW shortage is 60% of the nation's shortage and VIC's shortage is only 3% of the nation's shortage. I would be very concerned on this information investing in new build city centre Melbourne apartments.
3. Brisbane's house price growth is close to zero and the growth rate has substantially slowed in the past 12 months (6 month growth rates annualised). WA down approx 3%. They used CoreLogic RP Data, APM, ABS and Residex as sources.
I understand that the Brisbane median price is way below the Perth, Sydney and Melbourne (no sustained post GFC and floods recovery) but what other factors makes so many Somersoft investors look to Brisbane as the next market to take off. Economic factors make me concerned that 2012 was the time to invest there and its period of reasonable growth has past or is passing. If there are property fundamentals that make Brisbane still attractive despite its deteriorating economic environment, I would welcome any comments.
Thanks
GG