Report: the new hurdle for first-home buyers

Brisbane is no longer a haven for first first-home buyers, with property prices in the city predicted to remain strong through 2022, a new report has found.

Jutta and Andreas Pilz are selling their home in the affordable and liveable suburb of Mudgeeraba on the Gold Coast. Picture by Richard Gosling

Queensland’s housing affordability crisis has hit a new low, with first-home buyers now priced out of all but a handful of metro markets.

PRD Real Estate’s latest Affordable and Liveable Property Guide found strong price growth in Brisbane through the first half of 2022, even as the national market cools from the pandemic boom.

Househunters with a budget of under $700,000 can now only access 18 per cent of the Brisbane market.

For unit buyers with a budget of $400,000, it’s much worse on the Gold Coast, where you can access just 1.5 per cent of the market, compared with 16 per cent of available apartments in Brisbane.

Meanwhile, affordable housing options on the Gold Coast shrunk by half over the last 12 months, with a two-speed market emerging fuelled by deep undersupply.

Gold Coast house prices continued to grow but at a slower pace than through 2021.

Report author and PRD chief economist Diaswati Mardiasmo said the Gold Coast had emerged as, “the least friendly market for first-time unit buyers”, with fewer affordable options than any of Australia’s capital cities.

The report highlighted the most affordable and liveable suburbs, based not only on median price but also socioeconomic criteria including low crime and unemployment rates, nearby amenities and strong future development projects.

For houses, top picks were Tingalpa, Geebung and Lota in Brisbane, and Oxenford, Carrara, and Mudgeeraba on the Gold Coast

Brisbane’s best bets for units were Warner, Nundah, and Birkdale; and on the Gold Coast, Upper Coomera, Robina and Runaway Bay.

Longtime Mudgeeraba homeowners Jutta and Andreas Pilz were drawn to the suburb for its leafy acreage blocks and village atmosphere.

“When we moved here 31 years ago, Mudgeeraba was just a little village with a post office and butcher,” Mrs Pilz said.

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“We bought our block of land for $57,000, which even in those days was a steal. Up the road people were asking for $200,000. They weren’t necessarily better blocks, but everyone else walked away from this one because it was steep and there was only a strip of land across the top for a house. But my husband and I were open-minded and knew we could do something special with it.”

Jutta and Andreas Pilz in their unique pole home. Picture by Richard Gosling

The couple built a unique pole house at the bottom end of the half-hectare block which today also houses an art studio and short-term rental lodge. It is on the market, as the couple needs to downsize.

While prices in the suburb have risen significantly since they bought in, Mrs Pilz said it was still a “lovely place to live”, with three major supermarkets and a friendly community.

Ray White Upper Coomera agent Brad Wilson said the Gold Coast’s northern area offered good value for money for first-home buyers as well as downsizers.

“In Upper Coomera as well as Pimpama and Coomera, a four-bedroom house is still great value at $700,000 or under, while more downsizers are looking at units priced under $550,000 or $600,000,” Mr Wilson said.

“In the last few weeks, there has been a shortage of properties coming onto the market because of the interest rate rise and talk of prices dropping, but they haven’t really dropped.

“It’s still pretty competitive. We saw a lot of active buyers out last weekend and that was voting day, so it is still a great market for sellers,” he said.

Harcourts Property Centre agent said Tingalpa offered a convenient location close the city, with great schools and local facilities as well as easy access to the Gateway Mwy.

“You can still get into a townhouse priced in the mid to high $500,000s, while a low-set brick home is now priced from $800,000.

“Tingalpa is very affordable compared to surrounding suburbs, and there have been quite a lot of first-home buyers looking in the area up until the election announcement, when they went a bit quiet,” he said.

Dr Mardiasmo said Qld property prices would hold strong through 2022.

“Brisbane can no longer hold its title as a haven for first-home buyers, a title held all throughout 2021,” she said.

“An undersupply is evident in Brisbane metro, particularly for houses,” Dr Mardiasmo said.

“The Olympics 2032 announcement brought a certain buzz into Brisbane’s property market, and with border openings, this trend is expected to continue.”