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Brisbane Prime Residential Review Summary (Q3 2021)

Core Content Overview

This report provides a comprehensive analysis of the Brisbane prime residential market as of Q3 2021, highlighting trends in sales, price growth, rental performance, and the development pipeline. It also outlines the demographic and financial characteristics of the market, emphasizing the role of ultra-high-net-worth individuals (UHNWIs) and the influence of currency fluctuations.

Key Market Trends

Sales Performance

• Record Sales Volume: Brisbane's prime residential market experienced four consecutive quarters of record sales, with the strongest performance in Q2 2021.
• Sales Volume: 198 prime properties were sold in Q2 2021, marking a 42% increase compared to Q1 2021 and a 170% increase over the year ending June 2021.
• Super-Prime Sales: The number of super-prime ($7m+) sales remained steady at 3 in Q2 2021, but increased by 75% over the past year.
• Days on Market: The average days on market for prime properties in Q2 2021 was 127 days, slightly up from 129 days in the previous quarter.

Price Performance

• Capital Growth: Prime property prices in Brisbane grew by 5.8% over the year ending June 2021, with a 2.3% increase in the last quarter.
• Forecast: Knight Frank Research predicts a 7% increase in prime prices by the end of 2021 and a further 5% in 2022.
• Value for Money: At the end of 2020, US$1 million could buy 108 sqm of internal luxury floorspace in Brisbane, significantly more than in Sydney (46 sqm), London (30 sqm), or Hong Kong SAR (22 sqm).

Rental Performance

• Gross Rental Yield: The gross rental yield for Brisbane prime properties dropped slightly to 2.41% in Q2 2021 from 2.46% in Q2 2020.
• Rental Growth: Rental prices in Brisbane prime properties increased by 3.7% over the past year, with a 3.0% rise in Q2 2021.

Development Pipeline

• Completed Developments (2020): 3,425 medium- and high-density new apartments and townhouses were completed in Brisbane's prime regions, a 44% decrease from 2019 and below the 3-year average of 5,350.
• Forecast for 2021: Only 1,850 apartments and townhouses are expected to be completed in 2021, a 46% reduction compared to 2020.
• Distribution of Bedrooms:
  • 43% of the 3-year pipeline consists of 2-bed apartments.
  • 24% are studio and 1-bed units.
  • 33% are 3-bed or more properties.
• Price Trends: Brisbane's new prime apartment prices rose to an indicative $17,500/sqm in 2020, ranging between $15,000/sqm and $21,000/sqm.

Wealth and Investment Trends

• UHNW Population: Australia's ultra-high-net-worth individuals (UHNWIs) grew by 10.9% in 2020 to 3,124, with Brisbane accounting for 10% of this population (298 UHNWIs).
• Annual Growth Forecast: The UHNW population is expected to grow by 3.8% annually over the next five years.
• Private Investment: Total new private investment was down 3.6% at the end of 2020 but is forecast to rebound to 10.5% annual growth in 2021.
• City Wealth Index: Brisbane ranked 65th in the Knight Frank City Wealth Index in 2021, based on wealth, investment, and lifestyle factors.

Additional Information

• Prime Property Definition: Prime residential property is defined as the top 5% of each market by value, typically the most expensive and desirable properties.
• Sales Threshold: Prime residential sales in Brisbane are defined by a minimum value of AU$2 million.
• Currency Notes: All currency references are in Australian dollars (AUD), unless otherwise stated.

Contact Information

• Research: Michelle Ciesielski, +612 9036 6659, michelle.ciesielski@au.knightfrank.com
• Residential: Shayne Harris, +61 2 9036 6713, shayne.harris@au.knightfrank.com
• Valuations: Alistair Carpenter, +612 9036 6662, al.carpenter@au.knightfrank.com
• Franchise Partnerships: Scott Timbrell, +612 9761 1823, scott.timbrell@au.knightfrank.com
• Private Office: Sarah Harding, +612 9036 752, sarah.harding@au.knightfrank.com
• Media Enquiries: Caroline Stanley, +614 021 70901, pr@au.knightfrank.com

Recent Publications

• Sydney Prime Residential Review Q3 2021
• Melbourne Prime Residential Review Q3 2021
• Perth Prime Residential Review Q3 2021
• Gold Coast Prime Residential Review Q3 2021
• Australian Residential Tennis Court Premium 2021
• Australian Prime Waterfront Index 2021

Knight Frank Research Reports are available at knightfrank.com/research. The reports are intended for general information and should not be relied upon for decision-making.