Everyone is looking at where to invest now to have a great investment portfolio while having long-term growth. So, here’s some good news for everyone, especially for first home buyers, Queensland has recently outperformed all the other states in terms of offering the best affordable suburbs. But what’s going on in the market? How are the prices moving? Which factors should you consider while choosing a suburb, and which are the best destinations to buy a home?
Queensland Housing Market Trend
The Queensland market recently underwent seasonal shifts with several changes.
Constant Growth In Regional Areas
Where prices are growing everywhere, regional areas are presenting affordable housing options for first-home buyers. The regional areas like Brisbane, the Gold Coast, the Sunshine Coast, and Moreton Bay became affordable options.
Additionally, cities like Townsville and Rockhampton are not just affordable options but also show growth of 7.14% and 5.66%, respectively.
Population Growth & Migration
However, in Queensland, the population is rising at a rapid pace, and that’s mainly due to domestic migration. Trend shows that over 32,000 people migrated to the state last year. The Gold Coast, in particular, is a major destination for interstate migrants, further fueling demand and price growth.
As a result, the demand for housing is increasing, with housing prices making it difficult for first-home buyers to think of affordable suburbs.
Housing Shortages and Construction Challenges
Since the population is rising, the demand for housing is also increasing. This, in turn, puts more pressure on constructing housing. Research says that the state is lagging in housing construction by 96,000 homes.
This signals the major concern in the QLD housing market, thereby reducing affordable housing opportunities for first-home buyers.
Reasons To Invest in the Queensland Housing Market
Considering the above trend, we can say that the Queensland housing market is showing mixed signs. However, there are still strong reasons for buying your first home in the Queensland housing market:
High Investment Activity
Numbers say that in September 2024, more property investments took place, which was around 53% higher than in 2023. Moreover, borrowers borrowed $2.6 billion for property investments with high potential growth. That’s because many Southeast markets offered 1% vacancy rates with guaranteed returns.
Effective Regional Market Performance
Over time, Queensland regional markets are performing quite well. Here, the existing homeowners are already earning excellent rental yields with high capital growth.
Suburbs like Gladstone, Townsville, and Rockhampton are among the best, offering excellent returns. Therefore, for first-home buyers, these areas can be the best option now.
Favourable Interest Rate Environment
The RBA’s recent 0.25% rate cut in February has led to increased investor activity, along with expectations of further reductions. Such an environment also drives various investment opportunities. In particular, first-home buyers can take advantage of it while having more savings.
That’s because lower mortgage rates enhance borrowing capacity, making housing investment more accessible.
Government Infrastructure & Housing Initiatives
The Queensland government is also working on unique infrastructure and housing initiatives. For example, the Queensland Government’s Housing Investment Growth Initiative (GHIGI) is aimed at delivering 8,365 social and affordable homes.
The Homes for Queenslanders Plan is another initiative targeting one million new homes by 2046. As a result, the state remains a favourable investment choice, despite rising prices in some areas.
Now, the question is, which factors should investors consider while choosing an investment property in Queensland?
Consideration Factors While Looking for Investment Property
When choosing the right investment suburb, price trends shouldn’t be the only factor. Other factors include
Affordability and Entry Price
Before investing, check if the suburb’s median house or unit prices align with your budget and expected return. Affordable entry points in strong growth areas can offer better capital growth over time.
Rental Demand and Vacancy Rates
Areas with strong rental demand and low vacancy rates (around 1% or lower) indicate a healthy rental market. Such an environment can ensure consistent rental income and lower periods of vacancy. As a result, you can earn high rental yields while having high capital growth.
Migration & Infrastructure Trend
While choosing the investment suburb, it’s also essential to check where more migration is taking place. This helps identify suburbs with both rising prices and affordability. Further, checking upcoming infrastructure projects like Brisbane Metro will also add value to your investment decision.
High Cash-Flow Potential
While capital growth is important, cash flow is equally critical for many investors.
Check the suburb’s gross rental yield:
- A higher rental yield can help offset mortgage repayments.
- It ensures positive cash flow, reducing financial strain even if property values fluctuate.
Support From Government Initiatives
Since the Queensland government is also working to improve housing affordability, check for suburbs where you can get maximum benefits from them. For example, first-home buyers can take advantage of the First Home Guarantee Scheme, along with the Regional First Home Buyer Guarantee (RFHBG).
By this, they can secure their best suburbs without compromising their savings.
List of High-Performing Suburbs in Queensland
With the right factors in mind, Queensland will continue to offer favourable investment opportunities. Here’s a look at some of the best-performing suburbs to consider:
Stafford-Brisbane
Here, the homebuyers can buy their homes at a $1,100,000 median house price, while the unit price there is $605,000. This suburb is a viable option for first homebuyers who want higher rental yields. That’s because the average rental yield in this area is $650 per week for houses and $550 per week for units.
Gladstone Central
Gladstone offers affordable homes, with a $445,000 median house price and $315,000 unit price. This is the relatively cheapest suburb and also offers a 6.8% rental yield. Hence, first home buyers can look for this suburb with high capital growth potential and higher rental earnings.
Townsville-Northern Queensland
Although the property prices rose in this suburb in February to $526,000, now they are at $425,000. That means, with the blend of affordability and high growth potential, this suburb will be the best choice for investors and first home buyers. Here, they can earn a $500 per week rental yield with an 11.8% annual growth.
Beenleigh—Logan City
In this regional suburb, investors can buy houses at $685,000 and units at $435,000. As for rental yields, for houses it is 4.0% and for units it is 4.9%. Also, here you can see the compound growth of 17.7% for houses and 29.3% for units.
Macleay Island—Redland City Region
Currently, the median house prices are as low as $470,000, with high growth potential here. Investors/First home buyers can expect 19.9% capital growth and rental yields of up to $410 per week (5.0%). With a mix of beach views, this suburb will be the best choice for budget-driven investors like first-home buyers.
Kippa-Ring-Brisbane
Median house prices in Kippa-Ring are $775,000 for houses, while for units they are $508,000. These prices indicate it is the best investment hub in the Queensland housing market. Meanwhile, you can make $600 per week renting houses at a 4.2% yield, while units bring in $495 weekly with a 5.4% return.
Woodridge-Logan City
This regional suburb is also not less than any other. Here, the homebuyers can purchase a house for a median price of $650,000. Unit prices are also low here at $412,000, with high capital growth at 37.3% for units and 20.7% for houses. Furthermore, homebuyers can get rental yields of up to 4.3% for houses and 5.3% for units.
Goodna—Ipswich
Located in the greater region, Goodna is among the top affordable destinations. Here, the median house prices are $650,000 for houses and $424,000 for units. Additionally, homebuyers can rent houses for $505 weekly (4.4% yield) and units for $430 weekly (5.2% yield), offering solid investment returns.
Conclusion
So, we can say that Queensland is one of the most approachable states for investors and first-home buyers. That’s because regional markets are growing with extensive support from government initiatives. But before investing in suburbs, check rental demand, vacancy rates, cash flow, affordability, entry price, migration trends, and infrastructure growth.
Stafford, Gradstone, Townsville, Beeleigh, and Macleay Island rank higher among the high-growth suburbs. Now, since prices are rising, any further delay might cause you to miss out on the best housing opportunities.
Book your appointment at Nfinity Financials or speak to our mortgage experts at 1300 GET LOAN, 0456 456 267.
