Top units’ time to shine in Brisbane

Brisbane’s troubled apartment market is in recovery, with prices now outperforming Sydney and Melbourne.

Karen Walker will soon list her penthouse apartment at Brisbane’s Kangaroo Point, just as the price of luxury units in the capital are on the rise. Picture: Lyndon Mechielsen

Brisbane’s long-troubled apartment market is showing signs of recovery, with prices at the top end of town now outperforming Sydney and Melbourne.

The market in the Queensland capital has strengthened notably since being plagued by an oversupply of low-grade, investor-skewed apartment stock 2½ years ago. It has had sustained growth throughout the year, with prices in the top 2 per cent of the market growing 3.3 per cent in the three months to August, data from property researcher CoreLogic has shown. That was despite no growth in the rest of Brisbane’s unit market.

CoreLogic’s head of Australian research Tim Lawless said the result­s were not surprising, as the Brisbane unit market “has been through a fairly severe oversupply and it is well and truly emerging from that now’’.

Prices in Sydney’s top end surged 6.8 per cent in the past three months, but are still down 3.3 per cent in the year to August.

Unusually, gains in the greater Melbourne market (up 2.4 per cent) have outpaced the top end (up 0.7 per cent). The capital did experience the largest top-end declin­e through the downturn, with unit prices falling 7.4 per cent from 2016 peaks.

Household incomes down the east coast are generally consistent, but the cost to buy into the market varies greatly. The 98th percentile of homes in Brisbane is valued at $873,000.

Sydney is the least affordable market, with its 98th percentile at $1.85m, whereas 2 per cent of sales in Melbourne are above $1.18m.

Karen Walker is preparing to list her Kangaroo Point penthouse in Brisbane’s inner city.

She recently bought two apartments valued at $2.8m together off the plan in nearby Monterey Tower. “It is time to downsize,” Ms Walker said. “I’ve had a change in my circumstances and this place is very big for just me.”

Aria Property Group executive Michael Hurley said the top end of town was prepared to pay for quality. “Owner-occupiers tend to be emotionally driven and respond to quality,” he said.

The Brisbane-based boutique luxury developer has seen resale price increases across its portfolio.

Of the past 20 resales across five of Aria’s managed properties, 18 have recorded significant gains on original purchase prices, rang­ing from $100,000-$300,000.

Mr Lawless said Brisbane was “a great market to be buying into now … It has a strong lifestyle appeal­ to a lot of buyers, the economy is doing OK and is certainly growing, and you combine that with a marketplace at a very ­affordable price point.’’