Brisbane Leapfrogs Canberra to Become 2nd Most Expensive City to Buy a House

Property sales signage is displayed in North Lakes in Brisbane, Australia, on June 10, 2016. Glenn Hunt/Getty Images

Brisbane, the capital city of Queensland, has leapfrogged the nation’s capital Canberra to become the second-most expensive city to buy a house in the country.

A position it has not held since 1997.

The leaderboard for Australian real estate markets continues to reshuffle, mainly due to a lack of housing supply, increasing prices, and the influx of overseas and intrastate migration in the post-pandemic period.

In January, Brisbane house values surpassed Melbourne’s median for the first time since June 2008.

Now, according to the latest CoreLogic report (pdf) released on June 3, the median house value in Brisbane sits at $937,479—just $190 above the Melbourne median.

The unit value in Brisbane sits at $615,429, higher than the unit value in Melbourne, which sits at $614,299.

CoreLogic noted that before the pandemic, Melbourne’s median dwelling value held a 37 percent premium over Brisbane’s, while the Australian Capital Territory’s (ACT) median was about 24 percent higher.

However, since the beginning of COVID-19, Brisbane values increased at more than five times the pace of Melbourne values, with growth of 59.8 percent compared to its southern neighbour’s 11.2 percent.

Brisbane has also outpaced growth in the ACT where values are up 31.8 percent since March 2020.

The Brisbane CBD is seen from Kangaroo Point in Brisbane, Australia, on Aug. 5, 2021. AAP Image/Darren England

Low Housing Levels Driving Up Prices

CoreLogic research director, Tim Lawless, attributed the difference in growth rates to extremely low levels of housing supply across the strongest markets.

For example, the number of properties available for sale in Perth and Adelaide remain more than 40 percent below the five-year average for this time of the year, while Brisbane listings are 34 percent below average, he noted.

“Inventory levels in these markets remain well below average despite vendor activity lifting relative to this time last year,” Mr. Lawless said, according to the Hedonic Home Value Index report.

“Fresh listings are being absorbed rapidly by market demand, keeping stock levels low and upwards pressure on prices.”

CoreLogic research head Eliza Owen agreed, noting that while the pace of population growth is not compatible with the level of housing supply.

“Population moves quickly, housing supply doesn’t,” she told AAP.

“The shock of that population increase is something that developers and councils really haven’t been able to keep up with, and that’s what’s creating so much urgency and price pressure across the Brisbane market.”

Migration Numbers Strong

Data from the Australian Bureau of Statistics revealed the population growth in Queensland jumped by 2.7 percent within a year from September 2022 to September 2023, or 144,000 people. This was the highest growth on record in absolute terms

Queensland’s population is also predicted to boom in the coming decades, growing from the current 5.4 million to between 6.4 and 8.27 million by 2046, according to the Queensland government’s Department of Development and Infrastructure.

Government data showed that over the next decade, 30 percent of population growth in Queensland will be driven by natural growth, another 30 percent from interstate arrivals, and 40 percent from international migration.

After taking a dip when borders closed during the COVID-19 pandemic, Queensland’s international migration levels are set to average 27,000 people per year over the next decade.

Calls To Moderate Overseas Migration Levels

In May, Queensland Premier Steven Miles urged the federal government to consider reducing international migration levels.

“While our Homes for Queenslanders plan will deliver more homes, if migration continues at current levels we'll need tens of thousands more homes every year than industry can build,” he said at the time.

“That’s a big part of why prices and rents have risen so rapidly.”

“The federal government needs to assist us to ensure infrastructure keeps pace with population growth.

The Queensland government is trying to find a remedy, announcing the construction of up to 600 modular homes.

It has locked in a further $2.8 billion in the 2024-25 budget toward a plan to build 1 million homes by 2046.

AAP contributed to this article.