Brisbane Property Market Forecast 2020

Wondering what the rest of 2020 will bring to the Brisbane housing market? As we enter the last month of summer, we decided to look at expert forecasts for the Brisbane property market to see what the rest of 2020 and beyond will bring.

The property market in Brisbane looks set for moderate growth throughout the rest of 2020, after a turbulent year that saw prices end at roughly the same point they started at.

Like elsewhere in Australia, there was a property market downturn in Brisbane in 2019 that reached its lowest point halfway through the year, before a recovery saw prices grow in the second half of the year. However, both the downturn and the recovery were less pronounced in Brisbane compared to other capital cities.

Brisbane real estate
Brisbane house prices are expected to grow in 2020

Modest growth is set to continue over the next few months, and may accelerate as buyers in Melbourne and Sydney are forced to look elsewhere due to affordability issues in these cities.

With prices continuing to rise, and the likelihood of increasing buyers in the market, 2020 could be an ideal year to sell.

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What happened to the Brisbane property market in 2019?

Brisbane house prices grew by 0.3% in 2019. Prices decreased in the first half of the year until June, then grew in the second half of the year to finish just above where they started.

At the end of the year, the median house price in Brisbane was $546,781, the fourth highest in Australia after Sydney, Melbourne and Canberra. The median price for a unit was $389,023, the fifth highest in the country.

Learn more: How To Get The Most Accurate Property Price Estimate

The slump in the Brisbane real estate market was much less severe than Melbourne and Sydney, with values only 2.4% below their previous peak. The slump began in 2018 after stricter lending restrictions were put in place after the financial services royal commission, making it more difficult for buyers to access credit.

However, a strong economy and growing population helped soften the downturn in Brisbane, with Queensland being the number one area in Australia for interstate migration. As with the rest of the country, the market recovery in the last six months of the year was due to easing lending restrictions making it easier for buyers to access credit, and interest rates remaining low.

The premium end of the market saw the strongest recovery, with an increase of 2.4% after June for the top quartile, compared to growth of 1.5% for the bottom quartile.

The graph below shows this history of property prices in Brisbane over the last 10 years. As you can see, the slump last year was much less pronounced that the last market crash, and prices are on the rise again.

Brisbane property market graph
Brisbane property market graph

The growth of the second half of 2019 has continued into 2020, with house prices in Brisbane growing by 0.5% in January.

Growth looks set to continue for the rest of the year, so 2020 could be a great year to think about selling your home.

Thinking about selling? Find and compare the best real estate agents in Brisbane.

Brisbane property market: Expert forecasts for 2020

We looked at a range of experts’ predictions for housing prices in Brisbane and Queensland for the rest of 2020.

Overall, the market outlook is looking positive, with most experts expecting at least modest growth and possibly a further trend upwards as buyers are priced out of other markets later on in the year.

SQM research predictions

Analysts at SQM Research are forecasting property prices in Brisbane to grow by 3-6% under their most likely predicted scenario for 2020.

This scenario would see interest rates remaining low, the economy improving, and regulator APRA not intervening with increased lending restrictions in an attempt to slow down growth until at least the end of the year.

Under its second most likely predicted scenario, similar conditions to the first scenario would be in place and the reserve bank would also introduce a further cut in rates – as many experts are expecting. If this were to happen, SQM expects Brisbane house prices would increase by 4-7%.

If the conditions of the first scenario eventuate and APRA does intervene to increase lending restrictions, it still expects prices to increase by 3-6% (though growth would slow in most other capital cities). The Brisbane market is likely to be buoyed by mining investments, which would help insulate it from the effects of an APRA intervention.

AMP Capital predictions

AMP Capital predicts growth will start to pickup in Brisbane towards the end of the year, after buyers are priced out of the Sydney and Melbourne markets as they approach record highs. It sees prices as being on track to break records in Melbourne by March and by May in Sydney. Brisbane’s relative affordability and vacancy rates will make it an attractive proposition to those who can’t afford to buy in Melbourne and Sydney.

ANZ predictions

ANZ is forecasting property values in Brisbane to rise by 4%.

Earlier in 2019, it forecasted a lower rate of growth for 2020, but revised this after lending restrictions were later relaxed.

As with AMP Capital, it expects demand will be displaced to Brisbane as affordability limits are reached in Melbourne and Sydney. Although lending restrictions have been relaxed, they are still stricter than they were before the royal commission. ANZ expects that this will see affordability limits hit sooner than in previous real estate boom periods.

Westpac predictions

Westpac is forecasting growth in Brisbane house prices of 8% in 2020.

It sees the market gather pace during the year, being well placed in terms of affordability and in population growth.

It expects Brisbane house prices to grow more than any other capital city in Australia.

Like AMP and ANZ, Westpac sees more and more buyers being displaced to the Brisbane market as they are priced out of Melbourne and Sydney, adding to population growth and increasing the rate of price growth.

See top-performing agents in Brisbane: Real Estate Agents In Brisbane

Long-term Brisbane property market outlook (2021-2022)

Looking to 2021 and beyond, the Brisbane housing market is very well placed to continue growing strongly.

Brisbane property market outlook
Looking ahead at the long-term Brisbane property market outlook

The BIS Oxford Economics property forecast is predicting Brisbane house prices to grow more than anywhere else in the country over the next few years, expecting a 20% increase by 2022 (as reported by Michael Yardney of PropertyUpdate).

Yardney is confident of strong price growth in Brisbane in the medium to long-term, with a growing migration rate and relative affordability contributing to growth. Supply is also shrinking, in large part due to a reduction in new apartment construction over the last few years.

With the likely increasing demand from buyers priced out of Melbourne and Sydney, conditions are ideal for growth to remain strong for at least the next few years.

Yardney also sees positive signs for Brisbane’s economy, with major projects underway such as Queen’s Wharf, Cross River Rail and the second airport runway.

Learn more about selling: Real Estate Agent Fees in QLD + Brisbane

QBE is also expecting strong growth in the Brisbane property market over the next few years, predicting an increase of 20.3% in median house prices for the period of June 2019 to June 2022, and a more modest increase of 3.2% in unit prices.

It also expects price growth to be stronger than any other capital city in the country. With Brisbane only experiencing modest growth over the last ten years, houses are still relatively affordable. With rising population growth and falling supply of houses, Brisbane is in a strong position to see high and sustained price growth in the long-term.

QBE also expects the Queensland economy to strengthen, further contributing to accelerate price growth in 2021 and 2022.

The predictions are expecting a much lower rate of growth for units due to a continuing high level of supply. This is reflected in a high vacancy rate for apartments in the inner city, where most new complexes have been constructed.

Brisbane apartment market
Brisbane unit prices are predicted to grow more slowly than house prices

Overall dwelling supply peaked in 2016/17 and new dwelling completions have been falling every year since as the market moves towards under-supply.

With a growing job market, it’s likely there will be more and more buyers moving over from Melbourne and Sydney as they are priced out of those markets.

Falling supply and growing demand will keep Brisbane house prices trending upwards over the next few years.

Overall, the Brisbane real estate market is looking better and better for sellers, especially in the house market, as demand increases and more and more buyers move into the market.

Thinking about selling? Find and compare local real estate agents in your area.