3 Trends Investors Must Know About Brisbane Apartments

Today we look at 3 trends for Brisbane apartments: 

1. Brisbane’s apartment sales
2. Last year’s apartment buyer profile/origins
3. The current state of new apartment supply

1. Sale volumes

Calendar years	Settled sales	Yet to settle	Total sales
2013	7,482	750	8,232
2014	10,696	1,550	12,246
2015	11,302	2,350	13,652
2016	9,784	3,500	13,284
2017	7,465	1,100	8,565

 

Product type	Total sold (2017)	% sales
One bedroom	1,713	20%
Two bedrooms	5,824	68%
Three bedrooms	942	11%
Four+ bedrooms	86	1%
Total	8,565	100%

Sales volumes are falling. 

The median value of a new apartment in Brisbane was $585,000 in 2017, which is down 5.0% on the year before.

There were 8,565 apartment sales in Brisbane last year, of which most were either one, two or three bedroom product.

2. Buyer profile/origins

Buyer profile/origins	Resales (2017)	New sales (2017)
Buyer profile
Investor	65%	85%
Owner resident	35%	15%
Buyer origins
Brisbane region	60%	15%
Other SEQld	10%	5%
Other Qld	5%	5%
New South Wales	10%	35%
Other interstate	5%	15%
Overseas	10%	25%

New apartment product mostly sells to investors.

Local buyers dominate apartment resales but the majority of new apartment buyers live interstate and increasingly, overseas.

3. Status of new apartment projects

Project status	No. of projects	No. of apartments
Recently built (last 2 years)	65	11,500
Under construction (most completed in 2018)	43	10,000
Development approval & possible over next 2 to 3 years, but unlikely	49	10,350
Development application, concept phase, deferred, site for sale or abandoned, most very unlikely over next 3 to 5 years	96	27,650
Total	253	59,500

There are 253 recently completed or ‘active’ new major apartment projects in Brisbane.

This equates to some 59,500 apartments. 

Some scary stuff especially given the underlying need to build about 3,000 new apartments per year (revisit yesterday’s missive).  

But most of this new apartment stock is likely to be delayed or may not proceed at all.

Already we are seeing apartment sites being converted to office and other land uses.

Yet there is still pain to come, with 10,000 apartments, under construction, and most likely to be completed during 2018.

This equates to three to four years supply.

In simple terms, the cranes on Brisbane’s apartment skyline will be helping build other things, or moving somewhere else, once these 10,000 apartments currently under construction are squared away.