Investors who keep a keen eye on property news headlines may have been surprised when researcher CoreLogic declared Brisbane had overtaken Melbourne in median dwelling values.
But are the numbers what they seem? Digging deeper into the data is always a worthwhile exercise because it perfectly illustrates how property is never a static investment.
These key points explain Brisbane’s amazing growth while also revealing that Melbourne hasn’t exactly fallen off the perch.
Stellar growth
Brisbane has enjoyed the post-pandemic boom more than any other capital city. According to CoreLogic, its property values are up 50.2% since March 2020. Strong demand and a shortage of available properties have been the critical driving forces.
People power
Brisbane attracted 51,500 new residents in the 12 months to March 2022. By comparison, Melbourne lost 20,000. This also significantly impacts property supply and demand dynamics; an attractive issue for landlords when looking at further investments.
Impressive number
At $787,000, Brisbane now has the third-highest median value behind Sydney and Canberra.
Tricky maths
Brisbane beats Melbourne on median averages because Melbourne has a higher proportion of properties that are units. Given houses are usually more expensive, this drags down Melbourne’s median average.
The reality?
Is Brisbane more expensive, then? No. Individually, its median house and unit values are still $72,000 and $49,000 below Melbourne’s, according to CoreLogic. It’s just that the volume of units cruels Melbourne’s numbers.
What’s the lesson?
Investing in new or distant markets can be tricky, and the numbers are not always what they seem. Due diligence in every aspect of a purchase is essential before investing.
NOTE: The information in this article is general in nature and provided as a market overview only. Always consult your financial advisor or accountant for advice specific to your personal circumstances.