QLD MARKET OVERVIEW
QUEENSLAND
QLD Market Overview with Mark Witheriff Please take us through the current market dynamics across the Brisbane/SE QLD region, what is your gauge on the level of transaction activity taking place? so, has the market shifted in any material way, for example increasing appetite from interstate investors or developers, and if so, what have been the impacts?
The previous 12 months has seen a material shift. We have seen strong appetites from developers and end users together with investors into the residential sector. Given the current volatility in the market, it would be fair to say that developers have taken a pause and are reassessing the opportunities, however demand from the end user continues to be strong. Currently across South-East Queensland, residential vacancy rates are at record lows at sub 1% and given the continual growth in population and limited new development stock available, this trend is unlikely to shift anytime soon.
The market has reacted to a change in Government, a number of interest rate increases, and a volatile equity market, and therefore there is currently caution across South-East Queensland and a slowdown in transaction numbers. There remains optimism due to strong population growth, low job vacancies, and significant infrastructure spend in the lead up to the Olympic Games in 2032, therefore overall, a slowing of the market has occurred but a genuine confidence that this current instability should settle over the next few quarters. How would you evaluate buyer sentiment across the market, which asset classes are performing strongly and what are the factors at play that are generating such interest in these sectors? Current buyer sentiment is one of caution. The institutional market for investments has slowed significantly, however the high-net-worth private investors continue to look for value in properties with long term leases or value adding opportunities. In the development sector, the rise in interest rates is a concern but there is clear demand from the owner occupier market, particularly families relocating from Sydney and Melbourne to South-East Queensland, and this is fuelling demand, particularly on the Gold Coast, parts of Brisbane and the Sunshine Coast. The major concern in the development sector is the cost of construction escalating at rapid rates.
MARK WITHERIFF MANAGING DIRECTOR OF CBRE GOLD COAST
With regard to development sites in particular, can you give us an
understanding as to the profile of buyers that are transacting in this space, who are the most active buyer groups (local, interstate or international) and what are the characteristics they’re looking for in terms of ideal size, scope, price-range etc. And then with regard to development site values, what’s your take on how these have shifted and are there still pockets of value available for those groups looking to source suitable opportunities? The buyer profile currently sits at traditional South-East Queensland developers, and we have seen a range of new development groups entering the market from Sydney and Melbourne who have identified the slowdown in their marketplace and have followed the population
Reflecting on the past twelve months or
50 –July / August 2022
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