️ Highlights:
1. Brisbane has surpassed Melbourne in median dwelling value ranks, with a median dwelling value of $787,000 in December 2023, surpassing Melbourne’s median value for the first time since July 2009.
2. Brisbane’s strong capital growth, rising 50.2% since the onset of the pandemic, is driven by increased housing demand and a seller’s market fueled by remote work and population growth.
3. Melbourne has a higher share of units in its housing market compared to Brisbane, which brings down the median dwelling value across all houses and units.
4. Brisbane’s growth in dwelling values significantly outpaced Melbourne’s, with a 50.2% increase compared to Melbourne’s 11.0% increase since March 2020.
5. Lifestyle factors, such as the appeal of South East Queensland and Melbourne’s extended lockdowns, contributed to the varied capital growth outcomes between the two cities. Brisbane saw record-high net interstate migration, while Melbourne experienced a net loss of interstate migration.
CoreLogic’s Analysis Reveals a Shift in the Housing Market Dynamics
In a significant shift in Australia’s property market, Brisbane has overtaken Melbourne in terms of median dwelling value. CoreLogic’s Head of Research, Eliza Owen, provides an in-depth analysis of this notable change, highlighting the factors contributing to Brisbane’s remarkable capital growth.
Brisbane’s Exceptional Capital Growth
Since the onset of the pandemic in March 2020, Brisbane’s housing market has experienced extraordinary growth, with a 50.2% increase in home values. This surge in capital growth has been fueled by strong population growth, driven by the city’s appeal amid the rise of remote work, leading to increased housing demand and a seller’s market.
Brisbane’s New Milestone
By the end of last year, Brisbane achieved a significant milestone, securing the third-highest median dwelling value among Australian capitals, behind only Sydney and Canberra. In December, Greater Brisbane’s median dwelling value reached $787,000, surpassing Melbourne’s median value for the first time since July 2009 by approximately $7,000.
Factors Behind Brisbane’s Success
The reasons for Brisbane surpassing Melbourne in median dwelling value are multifaceted:
- Composition of Housing Stock: Despite a higher median dwelling value, Brisbane’s median house and unit values remain below Melbourne’s. This is attributed to Melbourne having a higher share of units in its housing market, which generally have lower values than detached houses.
- Brisbane’s Booming Market: Brisbane’s dwelling values rose significantly since March 2020, contrasting with Melbourne’s modest increase. Lifestyle factors and the normalization of remote work, coupled with Melbourne’s extended lockdowns, have influenced this disparity.
- Migration Trends: Net interstate migration to Queensland reached record highs, while Victoria experienced net losses. This shift in population dynamics has played a crucial role in altering the housing market landscape.
Outlook for Brisbane’s Property Market
While Brisbane remains a seller’s market, the pace of growth in home values has slightly eased. As home values continue to rise, Brisbane’s claim to affordability may diminish, potentially impacting future demand. Additionally, recent weather events and flooding risks could influence the near-term market dynamics.
Conclusion
The rise of Brisbane’s median dwelling value above Melbourne’s marks a significant development in Australia’s property market. This shift underscores the impact of the pandemic on housing preferences and the evolving market dynamics. As the market continues to adapt, understanding these trends will be crucial for stakeholders in the real estate sector.