Brisbane isn’t the first city that springs to mind when one ponders Australia’s beachside lifestyle and 365-day spring. To be fair, it’s not all beach (just ask anyone in Alice Springs) and it’s not always spring (Melbourne hit a whopping 2 degrees in July) but for the most part, is a lovely day more often than not. Perched just about dead centre on the east coast, Brisbane has plenty going for it. They just keep it under wraps.
Brisbane is an under the radar kind of city. It doesn’t have an iconic opera house, it doesn’t have a crowded art scene. There’s no mining, and it isn’t the de facto capital of wine country. But it is efficient (the underground Clem7 city bypass helps ease traffic), with a high living standard for its two million-plus residents. Brisbane’s population growth exceeds the national average, which is buoying its economy, based in tech, financial services and refining. The Port of Brisbane is a major point of entry for goods and tourism is on the rise. Brisbane is the capital of Queensland and it sits one to two hours away from major attractions at the Sunshine Coast, the Gold Coast and a little thing called the Great Barrier Reef.
“When I look at demographics I find that [investors and immigrants] swing into either Perth or into Melbourne. Then when they find out what they’ve missed out on you get the migration up to Queensland,” says area specialist John McAndrew, managing director of McAndrew Properties in Brisbane. “The entry point seems to be the southern states, then whatever the drivers are — lifestyle, and price is a big point — it drives people up here. We don’t get as many initial migrants but we pick them up in the long term.”
Development is on the rise, perhaps an extension of the rebuilding required following the devastating floods of 2010-11. South Bank has been reinvented as a swank dining and leisure district, Portside Wharf (the city’s cruise ship terminal) hasn’t look back since it opened in 2006 with chic residences, shops and dining and nearby Hamilton is currently dominated by empty lots and cranes for a massive 300-hectare riverfront redevelopment. The city in general has little reason to look back. “Overall the growth in Australia, broadly speaking, is about 3.3 percent and we’re at about 2.6 in southeast Queensland. So we’re leading from a growth factor. Sydney has been a very hot market and if you had a property clock Sydney is starting to get up around 11 o’clock. Queensland is probably around 6,” theorises McAndrew.
Brisbane is currently defined by the familiar refrain of undersupply and high demand. Supply is catering to first-home buyers after almost five years of stagnation and the new federal government has boosted confidence. Interest rates are staying low and locals are finding fresh borrowing capacity. “In turn that stimulates investors. Brisbane’s cycle is coming around and you’ve got the bigger developers saying, ‘We’ll start building because we’re confident we’ll be able to sell them.’ A lot of stock is sold to international investors. Both ends of the market are working right now,” explains McAndrew.
McAndrew Properties is a property agent and manager that also deals with marketing as well as a developer, and like most in the Brisbane area they’re finding clients’ needs and goals for a property range from owner-occupiers to overseas investors, with strong interest coming from Asia. Research by Knight Frank puts Brisbane’s rental yield rate at a national best 5.43 percent. McAndrew’s metric is $1 per $1,000 sold, meaning a property that sells for AU$350,000 (HK$2.5 million) will rent for roughly $350 per week (roughly HK$10,000 per month). Vacancies average two weeks per property, or 4 percent.
So while it’s not a stampede, there’s a steady trickle heading to Brisbane and southern Queensland and the reasons are simple. “Affordability and lifestyle are the two drivers,” says McAndrew. “We are affordable. Right now we have some townhouse 20 kilometres outside of the CBD for AU$350,000. Those are going to rent for $370 or $380 per week. It’s incredible stock and you’d pay twice the price in Sydney. And of course there’s lifestyle. Once people understand we’ve got it … it ticks a lot of the boxes.”
McAndrew isn’t the only game in town, but his new projects are typical of what’s going up in the area: spacious well layed-out units, with contemporary designs and many with sustainability features. McAndrew’s South Bank West End property boasts 80 percent investors that appreciate the one- and two-bedroom units that suit rental. Almost 70 percent of residents in the area are renting their homes. Also garnering significant investor attention are the centrally located Citro West End, Evolve at Chermside and Indigo Townhomes at Warner (both northern suburbs). “We’re very excited about the Brisbane cycle — the economy, interest rates, rentability,” finishes McAndrew. “It’s a good time to be involved in the southeast Queensland area.”