South-east Queensland is booming, as Victorians upped sticks and left

The property market in south-east Queensland is booming. At the same time, the prolonged lockdowns have reversed the recent migration trends in Victoria, with many residents choosing to make a lifestyle change in the sunny state.

Victorian population decline

As Melbourne passes a cumulative 230 days in lockdown, there has been evidence of internal migration away from the state of Victoria. There has been a marked shift towards south-east Queensland’s coastal and lifestyle locations.

While state borders have not always been open, even by the end of March 2021, there was a significant swing in population away from Victoria, reversing the internal migration trends towards Victoria prevailing in recent years. As Queensland has had relatively few restrictions over the past 18 months, residents have headed for the Sunshine State when the opportunity has presented itself.

South-east Queensland is booming, and the 2032 Olympics announcement has been the icing on the cake.

Australian Bureau of Statistics figures showed that Queensland’s estimated resident population increased by 43,900 over the year to March, while Victoria’s population fell by 42,000.

The main population growth hubs in the state are Greater Brisbane, Gold Coast, and Sunshine Coast, all of which have been busy locations in recent months.

Annual population change by state, March 2021
Figure 1 – Annual population change by state, March 2021

Vacancy rates in Melbourne have increased

We can see the impacts directly in the respective rental markets of the two states. For example, in Brisbane, the rental vacancy rates have continued to tighten to below 1.5 per cent, while the Gold Coast and the Sunshine Coast both have exceptionally tight rental markets. However, Melbourne’s inner regions have vacancy rates running at around 5 to 6 per cent.

SA4 RegionVacancy rate
Melbourne Inner6.6%
Melbourne Inner-East6%
Melbourne Inner-South5%
Figure 2 – Rental vacancy rates in inner Melbourne / Source: Riskwise, CoreLogic

The high vacancy rates in inner Melbourne have been exacerbated by the absence of international students and tourists, and as expected, we have seen declining rents. As a result, investors in Melbourne should expect and be prepared for low rental yields, at least for the coming year.

SA4 regionSuburbPostcodeMedian suburb rent
Melbourne – InnerFitzroy3065$495/week
Melbourne – Inner-EastBalwyn North3104$500/week
Melbourne – InnerFitzroy North3068$450/week
Melbourne – InnerCremorne3121$510/week
Melbourne – Inner-EastBurwood East3151$430/week
Figure 3 – Declining rents in Melbourne / Source: RiskWise, CoreLogic

There’s limited stock available in both states

Despite the shifts and the impacts on the rental market, property prices are rising in both states. Total property listings are extraordinarily low for this time of year, and this has seen housing prices push higher.

Even in Melbourne, where the housing market is almost in an induced coma at the moment due to restrictions on open homes, we still see some exceptionally strong results, and we expect that to continue in a renewed wave when restrictions are finally lifted.

The dynamics in south-east Queensland are a different matter entirely. The whole region from Noosa to the Tweed is booming, and our buyers agents are running at a very high capacity right now. The biggest challenge for buyers is sourcing stock, with properties selling exceptionally quickly.

Buying pre-market or off-market, if you can, is an excellent advantage in this type of market. Investors are coming back into the market in suburban Queensland, seeking detached houses with solid yields and the potential to add future value; however, demand is strong up and down the entire coastal strip.

Are you looking to make a sea-change to Queensland? We have experienced buyers agents who can help you find a property that ticks all your boxes.