There’s been a tangible change in the Brisbane property market since the federal election, with our sales team’s phones far busier than during the 2 month lead-up. Some confidence in making real estate decisions has returned. And amongst those popping their heads back up are investors and, finally, larger numbers of downsizers looking at selling the family home.
We’ve all been hearing for some years now that Australia’s 50 plus demographic are about to make a seismic shift from their suburban homes into city apartments. Toss out the free-loading 20-something ‘kid-ults’ and find a low maintenance lifestyle amongst our flourishing inner city neighbourhoods with their cafes, bars, theatres and parklands. And make no mistake it has started, and the trend for our empty-nesters to city living is gaining momentum. But many Brisbanites have been sitting on the fence and delaying the decision.
A couple of recent changes may now prove to be the tipping point that gets many more off their tired suburban armchairs and into a designer apartment!
The gap between our house and apartment prices has rarely been as large as it is today. REIQ data shows over the past 5 years Brisbane city’s house prices have risen 26% to a median $675,000, while apartments rose just 5% to $440,000. The gap has widened over the last 12 months as the apartment marketplace continues to absorb the avalanche of new supply added from 2015-2018.
Selling a house to downsize to an apartment will right now leave more dollars in your pocket.
And on all the market KPI’s it’ll be easier to do, with less days on market and less need to discount your price to achieve a sale than for the apartment owner you’re buying from. But – and here’s the caution in this tale – market commentators are already looking forward to an uptick in apartments. Leading valuation firm Herron Todd White this month moved their ‘property clock’ to place Brisbane apartments at the bottom of the cycle and from there the only way is up. Rents are firming, demand is solid and supply is no longer high.
Of course median prices are just a market midpoint and there’s been stronger price growth achieved for some segments of Brisbane property. Notably many owner-occupied targeted apartments and townhouses have outperformed. But on any measure this current gap in house and apartment prices is a great opportunity for those wanting a new lifestyle amongst the energy and action of our inner city.
And if you needed another financial incentive to make your move?! It’s rarely talked about but since July 2018 the Federal Government’s introduced a non-concessional downsizer super contribution opportunity for over 65’s who sell their home. Provided you’ve owned it for more than 10 years you can tip up to $300,000 each into super. Naturally there’s lots of fine print so please get expert advice.
Please share your comments – Are you considering a move? What’s your thoughts on downsizing to an apartment?