Money Minute – May 24 2017 “Brisbane Jitters”
And welcome back to the Today Show right around Australia.
Well, if you’re in Brisbane this morning, this is what you’re waking up to.
The fog, which is going to cause all sorts of problems with transport, but on top of that, just the peaks of those new buildings coming out.
Because right now, the peaks of those buildings are almost emblematic of what’s happening in Brisbane.
There’s a race on, not a race to the bus, the race is to lock in renters and the vast number of these new apartments that have been built over the past three years.
Brisbane, you see, join the property party the apartment building boom that Melbourne and Sydney were enjoying.
But Queensland being Queensland has got easy development and planning laws so the apartments were going up much more quickly and changed that skyline.
So now, in Brisbane at least, supply seems to be outstripping demand.
Too many apartments’ means investors are scrambling to lock down tenants,
There are stories of rents being cut by as much as 17 per cent…
So the story is, if you’re renting in Brisbane and your lease is up, have a really good look around before you re-sign, there could be some great deals out there for you.
A month or so back, research group SQM, suggested Greater Brisbane property faces an oversupply of 8,000 new dwellings this year – that’s across all of Brisbane.
In terms of inner city apartments, it says 1812 apartments are now under construction – 666 will be complete this year, 810 next year, 336 the year after…
There are signs right now that new building is on the wane,
The oversupply means it could be softness in prices, not just rent, and owners will need to hang on for at least two years before the demand can soak up that excess supply.
But if there are shocks to the system, in the meantime, that could also exacerbate short-term price movements, especially in Brisbane.
Now the same can’t be said for most of our other capital cities…
Melbourne, perhaps, is our closest but otherwise the rising population in the capital cities is keeping prices firm.
Notwithstanding warnings from the likes of S&P global ratings, that it’s increasingly worried about a sharp retraction in property prices, because of higher levels of household debt.
The message though for people in Brisbane, whether you’re a property investor or renter, you’ve got some negotiation to do.
Now the Dow Jones index of US shares is actually up by 43 points. Aussie dollar, this morning, 74.78 US cents
Karl, Lisa…a beautiful view in …Brisbane right now