The suburbs property experts have tipped as good investments

A slight cooling of the Queensland housing market is providing the perfect opportunity for investors to make a move, and property experts have tipped the areas where buyers should be watching.

A slight cooling of the Queensland housing market could signify the perfect opportunity for investors to make a move with property experts tipping the areas where buyers should be watching.

Core Logic’s March quarter data revealed a recent downturn in some suburbs across Townsville, Toowoomba and even on the Sunshine Coast.

The property data provider found median unit prices dropped more than 2 per cent in Townsville’s Hermit Park and Ayr, and 2.2 per cent in Toowoomba’s Middle Ridge.

Property researcher and Hotspotting founder Terry Ryder said buying into a market during a downtown was “probably the smartest strategy” for investors taking a long-term view.

“Because you can buy better, with less competition and for a good price provided you believe in the long-term growth potential of that area,” Mr Ryder said.

“If for example some parts of Townsville are showing a dip, well personally I think Townsville has a very strong future.

“It’s an important city, a growth city with a strong and diverse economy, lots of infrastructure spending and long term it’s going to do very well.

“So using that as background information, it would be a good investment to buy when the market is a little weaker.”

Mr Ryder said no one investment strategy would fit all buyers who need to consider their own budget and circumstances.

But generally they should look for specific growth drivers including diversity in the local economy, infrastructure spending, and low vacancy rates.

Another region Mr Ryder believed would experience significant growth was Toowoomba, where median unit prices plateaued or dropped in four suburbs in the March quarter.

He believes the market, long-term, will be driven by major and influential infrastructure projects underway as well as rising sales volumes and low vacancy rates.

Median unit prices dropped more than 2 per cent in Townsville’s Hermit Park and Ayr. Pic: unit in Hermit Park

Mr Ryder said while it was inevitable the national property boom wouldn’t last forever, he believed there was still strong growth to come in the southeast.

“I think one of the problems is a lot the analysis published talks about Australia as a single market and that’s the wrong way to approach it,” he said.

“The latest price figures from Core Logic showed that we have many different markets in Australia and different things are happening.

“Other sources have different figures but the Core Logic figures indicate we’re seeing small price declines in March in Sydney and Melbourne but Brisbane and regional Queensland there are very major increases.

Property researcher and Hotspotting founder Terry Ryder.

“We believe fundamentally that property markets rise out of local economies and we have very strong conditions in southeast Queensland and throughout Queensland.”

The impact of the floods in early 2022 is yet to be reflected in Queensland data and Mr Ryder believes Brisbane in particular is in still in the early stages of a major growth phase.

He expects the state’s capital to continue to lead the nation with Logan and Ipswich also being targeted for their affordability.

“One of the impacts of the flood is that it exacerbated the rental shortage so we’re going to see rents continue to rise which is unfortunate for the renters but good for the people who own the properties,” Mr Ryder said.

For those with a bit more cash to splash, Mr Ryder said suburbs such as Woolloongabba and Annerley, near infrastructure for the 2032 Olympics, should see significant growth in the lead up to the event.

Experts say the impact of the 2022 floods is yet to be reflected in QLD’s property data.

He touted regional centres including Bundaberg and Rockhampton as other areas of opportunity for investors who want to buy affordably with potential for growth.

“The Gold Coast has also been rather remarkable because at a time when its economy has been very negatively impacted by international border closures, it still managed to produce a property boom,” Mr Ryder said.

“So now international borders are open again and state borders are unrestricted I think the Gold Coast will have a strong year.”

Mr Ryder had less confidence in continued growth for the Sunshine Coast saying there were indications it was beginning to taper off after a fruitful three years.

He said property data, however, could be misleading and investors needed to take short-term analysis with a grain of salt, and instead take a long-term view.

Host of Selling Houses Australia Andrew Winter agreed with that sentiment and stressed the importance of investors considering their own personal circumstances.

“The little tip for investors is very simple and straightforward- if everybody is buying in that suburb at the time you’re looking at buying then it’s the wrong time to be buying,” Mr Winter said.

“Because investment is all about your point of entry, what you pay, and what you sell for and everything else in between is kind of irrelevant.

“If you buy at the peak of the market as an investor but you’re prepared to sit tight then you can still make a decent profit.

There is less confidence in continued growth for the Sunshine Coast. Pic: Caloundra

“But if you buy at the peak of the market and you get finally stretched during your time of ownership and have to sell at a time that's not ideal then you can lose money.”

Mr Winter said while growth would calm down, prices don’t fall as drastically as they rise.

A lack of land and housing supply across much of the Sunshine Coast, Brisbane and Gold Coast is expected to soften the blow of the end of a boom.

Mr Winter expects markets across southeast Queensland will begin to resemble those in Sydney in Melbourne.

“Where although the market may have quietened down, if you want to be in a particular established or highly-sought after prime suburb, there’s not really much stock on the market,” he said.

A lack of land and housing supply across much of the Sunshine Coast, Brisbane and Gold Coast is expected to soften the blow of the end of a boom. Pic: houses in Burleigh

“So you might get a little bit off but you’re not going to get an absolute bargain because what people will do is just knuckle down and think if they can’t sell for what they want they will forget it for the moment, rent it out or hold onto it rather than flood the market.”

Mr Winter expects areas with more supply will be hit harder as owners under stress might take a low offer and that could have a flow-on effect in the area.

But Queensland seems to be retaining demand and Mr Winter said there shouldn’t be panic for those who currently own.

For those looking to invest, Mr Winter said the knowledge people have of the market they actually live in and know can be a huge benefit.

“You have to make sure you’re very confident of your knowledge of the market that you’re about to enter,” Mr Winter said.