Brisbane home price growth back in the black

Brisbane has fought its way back into positive annual home price growth, shaking off 12 interest rate hikes since May 2022 to now sit just 0.81 points away from last year’s record level.

At the current rate of price growth, Brisbane’s dwelling price could surpass the last year’s peak by Spring.

Brisbane has fought its way back into positive annual home price growth, shaking off 12 interest rate hikes since May 2022 to now sit just 0.81 points away from last year’s record level.

The PropTrack Home Price Index, out Saturday, found home prices in Brisbane grew 0.08 per cent in a month – with the median price for all dwellings now $731,000 – and annual growth ending the financial year up 0.07 per cent.

PropTrack economist Angus Moore said Brisbane home prices are now just 0.81 per cent below the market’s April 2022 record level for all dwellings.

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Brisbane annual price growth for houses was negative at -0.53 per cent to end the financial year at $818,000, with units doing the heavy lifting rising 3.94 per cent to $546,000.

At the current pace of growth – which has been slowing after a 2.9 percentage points worth of rises since December – Brisbane could surpass the peak by Spring.

“Six consecutive months (of growth) is a pretty good outcome given what’s happened with interest rates. It’s probably not far off that we’ll cross that peak.”

“Limited supply of new properties hitting market, paired with strong demand, solid auction clearance rates, a slower pace of interest rate increases, and restricted rental stock are contributing to the recovery in prices this year.”

That spells bad news for buyers, with “price growth is likely to continue in the near term, despite the potential for further interest rate increases”.

“Higher interest rates are being offset by a limited flow of new properties hitting the market, as well as strong fundamentals for housing demand. While the total number of properties listed on realestate.com.au has picked up compared to a year ago, the flow of new properties hitting the market remains subdued, which is creating a more competitive environment for properties coming to market.”

PropTrack economist Angus Moore said the market is aware that the interest rate peak is also close.

Mr Moore said the market was very aware that “the peak of interest rates is likely close” which would bolster hard hit buyers.

“Buyers have a bit more confidence about what their costs are going to be, how much they can borrow, which really wasn’t the case in August, September last year when we were seeing 50bp increases every month,” he said.

“If you got a pre approval in July, bought a home in September, the amount that the bank was willing to lend you would have dropped dramatically over that period. It just made it a very hard environment to buy a home. We’re not really seeing that sort of rapid change (in borrowing power) at the moment.”

Brisbane is expected to see price growth continue in the near term “despite the potential for further interest rate increases”.

MORE: See the latest PropTrack Home Price Index

Brisbane’s unit market did a lot of the heavy lifting for the capital, with annual growth of 3.94 per cent to $546,000 – though both figures were surpassed by regional Queensland’s 4.89 per cent jump to $569,000.

Annual growth for houses was negative for Brisbane at -0.53 per cent to end the financial year at $818,000, but the rest of the state saw houses rise 2.19 per cent to $628,000.

Despite being one of only four regional markets where home prices declined over the month (-0.05 per cent for all dwellings), the rest of Queensland’s annual growth remains in positive territory overall, up 2.79 per cent year-on-year.

Cairns delivered the biggest annual jump in prices across Queensland’s cities, up 6.02 per cent to $480,000 annually, but median dwelling prices in both the Gold Coast (up 3.96 per cent to $840,000) and Sunshine Coast (-1.61 per cent to $929,000) continue to outperform Brisbane.

Townsville, which has been a popular target for interstate buyers looking for rental properties, has seen prices grow 2.34 per cent over the year to $390,000 – a level of affordability that’s likely to continue to drive up demand.

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