Offshore investors can't get enough of QLD

OFFSHORE investors' demand for residential property in Queensland has not abated with sales topping $558 million in the last financial year, according to DTZ.

According to DTZ’s national project marketing division, headquartered in Brisbane, the total value of QLD residential property sold offshore has increased at an average of 26% per year since 2003.

Director of project marketing Paul Barratt said total sales had surpassed the previous corresponding period by over $100 million, or 20%.

“More than 1,500 QLD residential property contracts were settled by offshore entities last financial year, not including unconditional contracts in projects currently being sold off the plan or under construction,”

But Barratt said whilst offshore sales had remained strong in the first half of this financial year, recent dramatic changes in the global marketplace had slowed activity across the board and would have a knock-on affect in terms of foreign investment into QLD.

“While these figures bode well for continued growth, the impacts of the global credit crunch aren’t to be underestimated. Realtors will have to be proactive in pursuing sales opportunities in key locations abroad in order to maintain the momentum moving forward,” he added.

The DTZ research revealed UK buyers were the most active property purchasers, investing $112 million.

Barratt said Brisbane had emerged as a favourite among foreign investors with $145 million in total residential property sales made to offshore sources in 2006-07.

“New Zealand purchasers spent the greatest amount on property in the wider Brisbane region, with a total of $32.5 million in sales. Also lining up were the UK at $30 million, China at $12 million, and the rest of Asia at $30 million.

“In terms of transaction numbers across the wider Brisbane region, there were just over 450 residential property contracts settled by offshore entities last financial year,” he continued.

On the Gold Coast, Russians represented the largest share of offshore sales at $35 million. Other nationalities represented included NZ with $32.5 million, New Caledonia at $28 million, Japan with $26 million, the UK at $22 million and the rest of Asia with $86 million.

The UK was the largest international investor of Sunshine Coast properties with a total of $21 million in sales in 2006-07. This was followed by NZ with $13 million, South Africa at $2.5 million, Ireland with $1.6 million and the rest of Asia at approximately $5 million.

The average value of offshore residential sales across the south-east ranged from $417,000 on the Gold Coast to $363,000 on the Sunshine Coast, and from $322,500 in the wider Brisbane area to $383,000 in Brisbane City.

Moving forward, Barratt said between 2,000 and 2,500 new apartments will be released to the Brisbane market next year, a marked increase on previous years, with around half of these falling into the $1 million-plus category and around 25% into the $2 million-plus price range.

And he identified the UK, United Arab Emirates and Asia as key targets, adding that buyers in these markets were well versed in foreign investment.

He said changes to NZ’s superannuation legislation could also pave the way for increased spending on QLD property.

Australian Property Journal