Brisbane offers strong potential
QUEENSLAND'S booming economy and population makes it the best place for investing and living, its politicians and estate agents say.
In the state's capital, Brisbane, residential prices have risen faster than in any other Australian city over the past five years due to the combined effects of immigration and economic growth, according to a property specialist said.
Quoting from the Residential Property Index compiled by the Real Estate Institute of Australia, Nigel Clark, the managing director of estate agents International Home Brokers, said capital values had risen 15 per cent in Brisbane over the past five years and 14 per cent in Perth. This compared with only five per cent in Sydney and eight per cent in Melbourne.
An analysis of the Brisbane property market's performance has produced mixed results. The Australian Bureau of Statistics reported that residential prices fell there in the third quarter of this year, while the Real Estate Institute of Australia said median house prices had increased 3.8 per cent in the Queensland capital in the 12 months to July 1995, to become the second highest climber in Australia.
Mr Clark said migration to Queensland, primarily from southern Australia and also from overseas, was sustaining healthy demand for homes in the state.
More than 1,000 people moved to Queensland every week last year, although this had slowed to 800 a week this year, he said. The state's annual population growth of 2.7 per cent last year was more than twice the national average.
The Queensland economy was the strongest in Australia, he said. According to the Queensland State Treasurer, Keith de Lacy, the state's economy was developing as fast as Hong Kong's.
In his Regional Economic Report Gold Coast 1995, Mr de Lacy said the Queensland economy had grown by 20 per cent between 1991 and 1994.
That compared favourably with Hong Kong's 21 per cent.
Mr de Lacy expected tourism to grow further in Queensland, together with high technology, information and film-making service industries.
Because of the increasingly small size of Brisbane households, Mr Clark advised investors to buy smaller apartments valued at between A$200,000 and $400,000 (HK$1.16 million and $2.32 million) and to rent them because the returns would be higher.
Hong Kong buyers had recently snapped up a number of Brisbane high-rise units. For example, half of the units sold at a new low-rise residential development in Toowong, five kilometres from the centre of Brisbane, had been bought by Hong Kong buyers, he said.
In addition, all 19 Hong Kong-owned flats of the 38 sold at the 50-unit Village of Langler Drew development were rented out.
Hong Kong demand for Brisbane homes had started to pick up over the past six months after having fallen last year.
But buyers were now much more discriminating in what they purchased, he said.
Estate agents said Hong Kong buyers were learning from past mistakes when many of them had bought properties which were not as well located as they originally believed.
For example, some Hong Kong investors had bought homes in Coomera in 1992, which they believed was a prime area of the Gold Coast, only to find out that it was located in a no-man's land between the Gold Coast and Brisbane.
Mr Clark urged potential buyers to make 'position, position, position' the watchwords when making investments to avoid getting caught out in a rapidly expanding market.
Respectable yields of between four and six per cent were obtainable on properties in the Queensland capital, he said.
Matthew Georgeson, general manager of Australian estate agents Ben Boyd's Hong Kong office, recommended buyers concentrate on Brisbane's inner city.
Inner-city prices were holding up better than those in the suburbs, he said.
The prospects for capital values to strengthen in the future were good, because the number of high-rise apartment blocks which could be built in the centre of Brisbane was nearing saturation point.
Mr Georgeson said Brisbane was the world's sixth-fastest growing city. People without children from southern Australia and younger migrants were attracted to the high quality of life.