Brisbane's fringe markets expected to remain steady: HTW
The suburban fringe of Brisbane sits around 15 to 20 kilometres from the CBD – that’s a reasonable Sunday run for some ultra-marathon participants.
This means while our most affordable property is still on the edge of established suburbs, it’s a commutable distance, according to valuation firm Herron Todd White's April 2016 residential property clock.
Brisbane also sits as a rising market for houses while starting to decline for units in HTW's property clock.
Our grand disadvantage as a city is we cover a wide area, and hence the primary public transport system servicing the majority of fringe residents is the bus network. That said, there are still plenty of these outer dwellers able to take advantage of car-accessible train stations, and if you must drive, our systems of tunnels and bypasses are certainly helping relieve congestion, say HTW.
When thinking of our most ‘active’ fringe suburbs, you can look at most compass points. In the west, it’s the multi-stage, mega community of Springfield Lakes. Go north and you’re starting to hit the urban edge around North Lakes, Mango Hill and Griffin although development is dotted beyond this as well. To the south we are building up to the point that it’s hard to tell where Brisbane finishes and the Gold Coast begins, but it’d be safe to say through Logan, Springwood and down to Beenleigh we’re looking at the very outer edges.
Pricewise, the western corridor demonstrates what buyers are looking at when it comes to a baseline buy-in figure. You can still find yourself a house in the very well serviced Springfield Lakes development at around $400,000, and you could even save $50,000 by heading a few kilometres up the road to Redbank Plains. There’s a ready tenant base and you can expect a gross yield of around 4.5% to 5%. According to our valuers, buyers and tenants are still looking to outer areas that are well serviced by facilities. Springfield Lakes has trains and shopping centres, both of which hold appeal for people who have to work in Brisbane’s CBD.
There are similar price points on offer in the North Lakes region. Investors require a touch over $350,000 to get a foot in the door. Once again, there are plenty of tenants available and gross returns of 4.5 percent to 5.5 percent help with the holding costs. North Lakes also appeals with it’s comprehensive retail facilities as well as ready access to the M1 (Bruce Highway) and Gateway Motorway. There’s also a public transport boost on the way as the new rail extension becomes established for those commuters.
While inner Brisbane does have relative affordability compared to a city like Sydney, those budget buyers with a long-term view can still expect a cheap purchase in the fringe to perform admirably. Springfield Lakes is potentially a good buy long term given it’s serviced by trains and shops, and other facilities coming on line including a hospital.
North Lakes and surrounds will probably take a little more time to pick up in their capital growth. There are plenty of infill subdivision sites close by, so supply is assured for some time yet.
As far as areas to avoid, there is still the flood overhang in some parts of the fringe. Make sure you check this carefully. Other attributes that create ‘secondary property’ such as main road frontages, high tension power lines or nearby industrial uses should also be treated with caution. Properties affected by these things can stagnate when the overall market slows down.
Over the medium and long term however, fringe markets are generally steady, so we expect the market to be relatively static for the foreseeable future.
Property Observer found a few recent sold examples of properties that reflect the fringe markets:
1. A four-bedroom house at 9 Talisker Street Springfield Lakes Qld 4300 (above) fetched $402,000
2. A three-bedroom townhouse at 45/42-51 Wattlebird Street Mango Hill Qld 4509 sold for $340,000