Buyers in Queensland are shopping in higher price brackets for a new home, with more house hunters now splurging in the million dollar-plus club.
For some, their move into the million-dollar plus club is being buoyed by record low interest rates and extra savings due to border closures putting a halt to overseas travel, but for others, rising house and unit prices are forcing buyers to spend more just to secure any home.
New data from realestate.com.au shows the number of buyers looking for property around $2 million in Queensland has soared 200 per cent in the past three years, up from just two per cent of buyers in 2019 to six per cent off all buyers as of April 2021.
The percentage of buyers shopping in the $1.5 million and $2.5 million price points has also doubled.
Across the state, the $750,000 price point continues to be the most popular, but the percentage of buyers in that price bracket has fallen from 35 per cent of all buyers in 2019 to just 30 per cent of buyers now, as median values push higher due to fierce competition for available properties.
On the Gold Coast, the number of buyers searching for properties under $1 million has plunged, while the number of buyers looking for a house or unit for $500,000 has halved.
The biggest percentage of buyers were in the $750,000 range, with 30 per cent of all buyers last month, down from 37 per cent of all buyers in April 2019.
That is a fall of 18.9 per cent in just three years, according to the data.
The biggest percentage growth in buyers has been for properties priced above $2 million, up 133 per cent last month compared to April 2019.
For buyers looking around $1 million, competition for stock has jumped 19 per cent, for $1.5 million properties it is up 100 per cent, and for those looking around $2.5 million, the number of buyers has also gone up by 100 per cent.
The percentage of buyers hunting for properties around $3.5 million also rose from one per cent of all buyers to two per cent.
REA Group economic research executive manager Cameron Kusher said there was strong price growth across Queensland, and in particular the southeast corner.
“There is a bit of FOMO (fear of missing out) going on as well,” he said.
Mr Kusher said there was “definitely more” million dollar-plus buyers in the market, and more people buying second properties, which only made it tougher for younger buyers.
It comes as the number of property listings dropped in May, according to SQM Research.
CoreLogic’s Home Value Index report also revealed that housing markets nationally continued to surge higher in May, with values up 2.2 per cent over the month and 10.6 per cent over the year.
Kollosche managing director Michael Kollosche said values had risen around 20 per cent across most price brackets.
“So those who were looking sub-$2 million are now looking over $2 million and if they have a stable income, and with low interest rates, they are looking up,” he said.
“The other factor is that we have such limited stock, which also means limited turnover which is probably skewing the market.
“There is also the issue of vendor expectation – some are hoping the buyer demand will mean they will get well above top dollar, but buyers are mindful of value.
“We are also still getting strong inquiry at the top end, but having stock that meets a buyers requirements is tough.”
Mr Kusher said he expected prices to continue to climb this year, albeit at a slower pace.
“There are fewer properties in the more affordable price ranges now so the number of buyers looking at the higher brackets will likely continue to go up,” he said.
The data shows that there are now almost as many buyers shopping in the $1.5 million bracket in Queensland as there is in $500,000 price point.
In order to find a balance, Mr Kusher said more housing needed to be constructed and more people needed to sell, but those same people also needed to be able to buy.
“I think once the borders open and the focus comes off property a bit, the pressure will ease up,” he said.
This content was originally published here.
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