End Of Financial Year Property Market Wrap

End Of Financial Year Property Market Wrap

19 June 2021

Having defied all predictions and expectations amidst the backdrop of Covid-19, Australia’s housing market is currently experiencing an incredible cycle of growth with no signs of slowing.

Twelve months ago, things were looking pretty dire for the property market. Covid-19 had changed the world forever and the experts had unanimously agreed that all signs were pointing to a catastrophic decline in financial markets and a dark future, at least in the short to medium term, for real estate. How wrong we all were.

Fast forward to June 2021 and suddenly, much to everyone’s shock, we are now in the midst of an unprecedented property boom with housing prices across Australia’s five biggest capital cities having jumped by an incredible 9.5% since only the beginning of the year. Median house prices in Brisbane alone have jumped by a staggering 6.2% in the past three months alone.

This trend shows no signs of slowing either. In Queensland, a rapid surge in interstate migration has injected the market with a huge spike in demand as cashed up buyers from the Southern states have fled the expensive and congested Sydney and Covid-stricken Melbourne for the comparatively affordable and largely Covid-free Sunshine State. This influx of domestic migration, combined with increased first home buyer interest driven by Government stimulus and the easy availability of cheap finance has created a perfect storm of high demand, low supply market conditions.

As always, there are two sides to the story and while this is all great news if you are a property owner, it is no so great if you are a first home buyer trying to get into the market or worse yet, needing to find somewhere to rent. One of the knock-on effects of the hot market has been the displacement of tenants and would be renters – As investors look to sell of their investment stock to take advantage of the positive market conditions, these rental homes are being bought primarily by owner occupiers which is further amplifying the shortage of rental stock.

This is a trend likely to continue (and possibly gain momentum) into the second half of 2021 at least; As the Queensland Government seek to introduce tough new laws to protect tenants from being unfairly displaced, this will likely add further fuel to the investment stock sell-off as investors look to liquidate their investment properties before these tough new laws are passed through parliament. All of which will further contribute to rising home prices and remove more and more rental stock from the marketplace.

While the spectre of Covid-19 still looms large, and will continue to pose a threat to growth in all financial markets, the property market in South East Queensland at least shows no signs of cooling and looks likely to continue its positive trajectory throughout the second half of 2021.

‘Til next time, ciao 😊

Lee Knutsen

Article by Lee Knutsen

Co-founder & Managing Director of House, Lee Knutsen first entered the real estate industry in 2006 as a residential sales specialist. After more than a decade as a sales agent…

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