Both investors in rental property or first home buyers would prefer to invest in properties which will appreciate more than average over the years. This will not only grant them stability of the investment, but will also increase their wealth over time. This is why it is important to choose wisely prior to making the investment.
When analyzing the investment potential of Brisbane’s suburbs, their ranking may vary depending on the methodology used. Sure, all similar rankings will take into consideration:
- Historic prices;
- Increasing rents;
- Insignificant vacancy rates;
- Infrastructure and proximity to facilities (important);
- Upcoming significant construction projects (very important);
- Improving demographics;
- Social life and sports;
- Decreasing days on market.
However it is reasonable to go a step (of a few steps) further:
Property investments are long term ones. This should not be underestimated, as the prices of properties will vary month to month and year on year. However short-term fluctuations should be excluded when considering the investment potential of the suburbs. Rather we are interested in their long-term potential.
Future Vs. Past
Looking at the past price performance for a given area is a starting point but nothing more. Investors want to invest in suburbs which have future growth potential, rather than past good performance. The reverse is also feasible. The example of this would be Chermside, where intensive construction over the past decade had outperformed demand. Thus the suburb prices, especially for units, were steadily decreasing (10% for the last 10 years, to be exact). However, large construction is over. A more wealthy demographic is moving in the new construction. The Westfield shopping centre is growing and new bars and cafes are popping up all over the area. All of this does not look good historically, but is offering some promising investments today, viewing the future.
Sometimes data can lead to the wrong conclusions. In these cases a field visit or some additional information is a must. Such is the case with Kallangur to the North of Brisbane. The suburb has performed remarkably well for units. However this is house-territory. The few units available and sold are sending wrong signals to investors, who are not looking at the big picture.
More Than Meets The Eye
Some areas are growing strongly and have growth potential. … but there is a hidden story, which investors need to be aware of. Banksia Beach is one such location. Prices there have grown by 37% over the past ten years. The suburb offers secluded peace and quiet, no traffic, no shopping malls. This may be great for retirees. However this is not good news, when investment growth potential is concerned. Such locations could turn their trend very quickly and lead to investment losses.
The “Average” Problem
You may have heard of the joke: “I eat the garnish and you eat the pork. On average we are both eating pork with garnish.” Deception Bay offers just such a deception. The suburb has a great location, minutes’ drive both from the City Center and from Sunshine Coast. House prices have enjoyed a 33% price increase over the last 10 years.
So, investment in a house would seem a good idea. Right?
Just visiting Deception Bay will reveal the issue. The suburb is split in two by Deception Bay Road. On one side a massive renovation project and facility upgrade have been under way for some time. Such is not the case by far just on the other side of the street, where the sight is somewhat sad. The locomotives of the price surge in Deception Bay have been the renovated homes in larger blocks, whose prices have skyrocketed. Not so on the other side of the Road. This is a suburb where being on the correct side of the road really counts.
The 2022 List
Having said all that, now let’s look at the shortlisted top 5 Brisbane suburbs for investment consideration in 2022. This time things are really getting interesting – the 2032 Olympic Games are coming (a healthy 10 year investment stretch):
Located just 2 km. south from Brisbane CBD and encompasses the Brisbane Cricket Ground (AKA Gabba). This will be the location of many Olympic events. If the latter is not enough, the suburb is also one of the best emerging city suburbs with a little something for everyone. Average house prices are expected to soar from the current AUD 1 million to AUD 2 million after 2032.
Hamilton is expected to house the Olympic Village. Should this come to pass, house prices are predicted to jump from AUD 1.65 million to AUD 4 million post Olympics. It is an affluent riverside mixed-use suburb even today. The huge surge in house prices is expected to be the result of large infrastructure projects in the suburb, linked with the Olympics.
3. Dutton Park
Construction of the Cross River Rail line from Dutton Part to Bowen Hills with tunnels under the Brisbane River and under the Brisbane CBD will elevate property prices in the suburb.
One of the five new Olympic bridges promised by Lord Mayor Schrinner is the Breakfast Creek Green Bridge. This should link Newstead to Albion, thus connecting the Olympics Village Hamilton to the city.
This suburb of the Gold Coast should be carefully considered as it is expected to house the second Olympic Village. Even without this it currently has fantastic infrastructure and a perfect selection of recreational facilities and schools.
In this article we have ranked the top 5 Brisbane suburbs for property investment in 2022. We have also provided the methodology used and our logic. However separating the wheat from the chaff, when it comes to property investment advice, is not set in stone. As one may guess, all of the methodology factors are dynamic and may change from month to month. This is why we advise that future investors may use our article as a starting point, but should consult with their mortgage brokers in Brisbane.
The mortgage brokers or home loan brokers in Brisbane keep their hands on the pulse of the Brisbane market. As Turkish Citizenship by Investment, they have to know all the details of the market they work on.