A new report has found Brisbane’s new apartment supply is shrinking fast. Image: AAP/Darren England.
The time to buy an apartment in Brisbane is now, according to a leading property analyst.
Nearly two thirds of apartment projects planned for the city have been ditched or deferred as it heads towards an undersupply of stock that could drive up prices and competition, a new report reveals.
The Place Advisory report shows new development applications now account for just 10 per cent of the future apartment pipeline, with 62 per cent shelved or abandoned and only 28 per cent approved.
Place Advisory director Lachlan Walker says it’s a good time to look at buying an apartment in Brisbane.
Inner Brisbane “appears to be headed toward undersupply within the next 12 to 18 months”, according to the report, which makes a return to sustained capital growth in the apartment market an increasingly likely scenario.
Place Advisory director Lachlan Walker said there had been a significant shift away from investor-grade one-bedroom units to higher quality two-bedroom and three-bedroom, which was good news for buyers.
Quality apartments aimed at owner-occupiers like those in Gallery House in Hamilton are selling fast.
Mr Walker said less stock was coming to market, which meant increased demand and likely price growth.
“It’s definitely a good time to be looking at the apartment market again,” Mr Walker said.
“Compared to 18 months ago, when the apartment market was to some degree flooded, the current product on market is designed for owner occupier purchasers (not investors).”
The average apartment sale price in Brisbane is 6.5 per cent higher at $841,333 based on 150 unconditional sales — up from $790,000 in the September quarter and $700,000 in the same period 12 months prior.
The second stage of the waterfront development Gallery House sold 22 apartments during the December quarter, the highest result of any development.
Jorge and Alejandra Palacios recently bought an apartment off-the-plan in Gallery House in Hamilton.
Other developments, including 443 Queen, Alcyone Residences, Capri, Soko Waterfront Apartments, The Mews and The Standard all recorded more than 10 unconditional sales for the quarter.
The report said construction of the majority of new apartments would be completed in 2019, with 44 per cent currently completed.
The latest Urbis apartment report predicts the national apartment market will show signs of recovery this year.
The report found that with new stock coming in and sales experiencing speed bumps, national apartment sales as a percentage of available stock dropped to a new low of 7.7 per cent in the December quarter of 2018.
It noted that the first half of 2019 would likely bring more than 1000 new apartment launches for Brisbane.
Originally published by Elizabeth Tilly, The Courier Mail (Realestate.com.au) here.
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