Buying in Brisbane has suddenly become top of mind for real estate consumers, influenced by confirmation of the 2032 Olympics.
But Brisbane was already one of Australia’s rising markets. The Olympics decision simply adds another layer to Brisbane’s growing credentials as the place to own real estate.
Firstly, what does the Olympics decision mean? The answer is 10 years of intense investment and premium growth – not just for Brisbane but for South-East Queensland (SEQ) real estate generally and other parts of the state as well.
Confirmation that Brisbane, the Gold Coast and the Sunshine Coast will be the 2032 hosts is an undeniable game-changer for the economies and property markets of SEQ.
Property prices and rents are already rising across SEQ but the Olympics announcement will turbocharge markets throughout the region.
Spending on major new infrastructure has been pivotal in generating economic activity, jobs and real estate demand in SEQ in the past year – and the prospect of hosting the Olympics in 10 years’ time will generate an elevated program of investment and development.
The real estate industry tends to spruik a property boom after a major event like the Olympics but all the evidence suggests that the greatest impact for property markets occurs in the lead-up to the event, not in the aftermath.
The Sydney Olympics in 2000 and the Commonwealth Games on the Gold Coast in 2018 provide templates for how these big events can impact local economies and property markets.
The years leading up to the 2018 Commonwealth Games on the Gold Coast saw increased real estate activity, thanks to the rising levels of construction of infrastructure and facilities, the jobs this generated and the consequent demand for real estate accommodation.
There were similar outcomes around the 2000 Olympics in Sydney.
The Olympics announcement also creates increased media focus on the SEQ region and the affordable lifestyle it offers. And it starts now – and will extend over the next 10 years.
A state government analysis suggested that the 21 July announcement by the International Olympic Committee alone generated publicity and profile for Brisbane and Queensland that was worth $170 million.
Property prices and Olympic Games host cities
PIPA chairman, Peter Koulizos, has commented on what the 2032 Olympic Games may mean for the Brisbane property market.
“Research shows that residential property prices do perform better as a result of an Olympic Games,” he said. “A study on six host cities, from Los Angeles in 1984 to Sydney in 2000, suggests that the impact on the economy and residential property prices is not even. It depends on the planning and the scale of the Olympic investment.
“Research on the London Olympics showed that areas close to Olympic facilities increased in value by 2% to 5% higher than other areas.
“An investigation on the impact of the Sydney Olympics on the residential property market found that the markets of host suburbs experienced substantially higher growth during the bidding and pre-Olympic periods, but not after the Olympics were held.
“PIPA has conducted research into Sydney’s residential property prices pre- and post-Olympics that shows that from the time the announcement was made in September 1993 to the Olympics being held, Sydney was one of the best performing capital cities. However, post-Olympics, the rate of growth decreased significantly.
“Based on our research and analysis, it is obvious that Brisbane and SEQ will benefit from hosting the Olympic Games.
“However, the benefits will vary depending on the location of Olympic facilities and the new infrastructure to be built, especially infrastructure that will better link the Sunshine Coast and Gold Coast to Brisbane.”
Things were already looking good
Keep in mind that the markets most impacted – Brisbane, the Sunshine Coast and the Gold Coast – were already in the ascendancy pre-announcement.
The rise in sales activity in Brisbane since late 2020 has been exponential. Markets right across the Greater Brisbane area were recording sales volumes not seen in more than a decade. This was translating into big growth in median house prices, with some of the million-dollar suburbs rising more than 20% and some suburbs in middle- and outer-ring areas increasing 10%-15%.
More people are moving to Queensland
The official population data shows that Queensland, particularly SEQ, is by far the biggest beneficiary of internal migration (people relocating from one part of Australia to another).
In simple terms, people are leaving Sydney and Melbourne in significant numbers and moving to the smaller cities and to regional Australia.
SEQ is the number one target because it offers what these internal migrants are seeking – a more relaxed lifestyle at an affordable price. This part of Australia also scores highly on its successful control of the pandemic, particularly in comparison to Sydney and Melbourne.
The Gold Coast has been particularly targeted by big-city residents fed up with the long and repeated lockdowns. It has also been targeted by expat Aussies escaping coronavirus hotspots overseas and seeking real estate hotspots in Australia.
The Sunshine Coast has been on an irresistible growth path for the past three years, helped by a $20 billion infrastructure program. Just when its market appeared to be tapering after very strong price growth, the Olympics decision has come along to create a second wave of buyer interest.