Follow the yellow brick road?
Finding the next real estate “hot spot” is a sport some investors follow with a passion. Various magazines and websites devote pages to crystal balling and it wouldn’t be a good Australian bbq without someone claiming inside knowledge on the next suburb to experience double-digit price growth.
One of the most well-supported theories is to follow major infrastructure projects and look for the impact from new roads, rail lines, bridges, schools and other major community amenities. When Toowong’s City Cat ferry stop was proposed the developers of the adjacent Regatta Riverside apartments contributed heavily to the pontoon’s sizeable cost, punting that easier CBD access would earn them extra revenue – and no doubt it did. New infrastructure can often mean quick jumps in property prices.
To test the theory we took a look at property near the new Eleanor Schonell Bridge in the inner south’s Dutton Park. Completed in December 2006 it’s a ‘green bridge’ linking the area to St Lucia’s University of Queensland. UQ has some 38,000 students and staff, so when Brisbane City Council first announced the bridge inner south agents declared rents and home prices were about to boom…
One year on the local market appears largely unaffected. The median rent of a 2 bedroom apartment did jump 22% in Dutton Park and its adjoining suburbs (up from $230 to $280/week in the year to December 2007). But interestingly 2 bedroom apartment rents also jumped 21% in the postcode in the year before the Bridge opened! Three bedroom houses actually recorded a small drop for the year. Dutton Park’s median house sale price in 2007 was up 9% on 2006. Good, but considered relatively slow compared to other inner city suburbs.
Suburbs adjacent to the Bridge did perform well but there’s no real sign of this easier access to UQ having any major impact. This has always been a popular part of Brisbane and it continues to be, and buyers have probably been pricing the new infrastructure in over the years since its announcement. For tenants though the Bridge may just be a ‘good to have’ and they’re not paying $30 or $40 per week over and above the market now that it’s completed. Ironically the recent expansion of the PA Hospital has had as much or even more impact on demand and we’ve sold homes in Annerley where that was a definite drawcard.