House prices won’t go up or down because of it.
The real estate market in Queensland is just in a different stage of its cycle – as are all the states, cities and even suburban micro-markets.
Queensland is on the upswing of its current cycle. This phase is generally characterised by low interest rates, low stock volume, short time on market and rising property values, which affect affordability. Also, along with increasing rents, increasing construction, population growth and rising employment levels, these influences firm up the closer the market gets to the top of its cycle.
The Reserve Bank left interest rates at 2.5 per cent from August 2013 until lowering rates to 2.25 per cent this week. However, unemployment or job concerns are the greatest inhibitor to making real estate decisions, regardless of record-low interest rates and further rate cuts.
After consistently underperforming since 2008, Brisbane has shown improvement over the past 12 months, and regional centres are beginning to hum.
Since a post-boom realignment in housing prices in the mining areas, other regional centres are coming to the fore as top performers. RE/MAX sales associates are writing big figures on the Sunshine Coast and Gold Coast; Cairns, Townsville, Bundaberg and Hervey Bay are also reporting strong sales.
The traditional wave of people moving up from southern states has not yet resumed, but it is on its way. Queensland has that ahead of it. This is actually good news for the southern states as it will release properties onto the market there, which is very much needed.
When there is around 40 per cent pricing differential, people start to think about moving. First come those moving for lifestyle decisions, generally not needing employment; but as their numbers grow in their new locations, they require services. Employment opportunities rise for the next wave.
This internal migration will add to the other positive influences on the Queensland property market, including foreign investment, self-managed super funds and the confident domestic market activity.
This is a very opportunistic time to get into the market – now, and not in six or 12 months’ time.