A fine festive forecast

Well, it’s almost time to wax up the surfboard, peel a few prawns, and raise a cold glass or two with family and friends for Christmas.

In summary, this year has been one of steady growth across the inner city market. While sales activity is cooling in Sydney and Melbourne, Brisbane is continuing on its growth trajectory.  Here are our key observations, as we move into the New Year:

1. “Buy land, they’re not making it anymore”–  Mark Twain. In our books, land remains king. Every year the value of your allotment increases while your improvements depreciate. Buy an allotment, a patch of dirt (regardless of the improvements), in a quality inner city location. You will be handsomely rewarded over time.
2. When investing in real estate, the law of supply and demand dictates your capital growth. By selecting a category where supply is fixed or decreasing, you will be assured of good growth. Look for land with redevelopment potential or hilltop, beachfront, riverfront, inner city, ‘brand’ streets, and parkland locations. Select one of these categories for a turbo-charged investment.
3. Business confidence is rising, with a more optimistic government outlook at the Federal level. People always ask ‘when is the best time to sell?’ The answer is simple, when business confidence is is on the up.
4. Low interest rates are fuelling the bottom half of the market. We can’t see this cooling any time soon.  The impact trickles up.
5. We speak with a lot of buyers looking to purchase an inner city home where they can ‘add value’ for the future. Competition for the inner city renovator is at fever pitch, driven by a combination of affordability (low interest rates) and social infrastructure (cafes, bars and public transport). If you are trying to buy in one of Brisbane’s inner hot spots (Taringa, West End, New Farm, Red Hill, Wilston) in the $750,000 to $950,000 price range, it’s a bit like trying to buy fresh prawns on Christmas day … expect long queues!
6. There is still excellent value for buyers at the top end of the market. Napier Blakeley Quantity Surveyors now estimate the cost of construction for an architecturally-designed home at $2,500 to $4,500 per square metre. So, if you do your sums on the cost of a high-end renovation of that diamond in the rough, compared to buying the finished product, you will be surprised at the buying opportunities at the top end of the market.
7. As buyers increasingly compete around the mid-price point, many will end up buying in a higher price bracket, saving themselves time and stress. Strengthening lower and mid-price markets always create upward pressure. We are expecting the top end of the market to do well in 2016.

Thank you to all our clients who’ve sent business our way in 2015. Dixon Family Estate Agents has recorded its best year yet! Included here are some of our sales highlights, along with our four most popular blogs for 2015.

We strongly agree with the market analysts now saying current sales activity patterns, considered alongside other positive indicators, suggest Brisbane will enjoy a healthy and rising market in 2016.  So, if we can assist you again in the New Year, please be in touch.  All the very best for the festive season and the year ahead.