9 FEBRUARY 2015
It found Brisbane’s price growth has risen to 6.1%, providing another piece of evidence that Brisbane and South East Queensland is the nation’s major rising market.
That in itself is not startling news, as many property analysts and commentators, including me, have been advocating Brisbane as a nation-leading growth centre for 2015.
On 1 December I wrote on Property Observer:
“There’s a pretty good argument that the hottest property precinct in Australia right now is South East Queensland.
“Brisbane, the Gold Coast, the Sunshine Coast ... All three have hot markets. The research conducted by Hotspotting for the latest edition of the Price Predictor Index revealed 254 suburbs across South East Queensland with rising sales activity. To put that in perspective, the Sydney metropolitan area has 106 growth suburbs.”
So that’s a good starting point. But South East Queensland is a big chunk of territory. As I pointed out on 1 December: “Together they comprise a vast metropolitan area - ongoing urban growth means these three big centres have merged into one big conurbation which starts at the NSW border and extends 250 kilometres north to Noosa.”
So where to place a more focused span of attention? There are myriad options but one that I particularly fancy is the unheralded (indeed often maligned) municipality of Logan City.
The local council sees it as a strategic “city between two cities” because Logan bridges the gap between Brisbane City and Gold Coast City.
It’s a municipality of 60 mostly affordable suburbs and collectively they are a nice fit for my core formula of affordability + infrastructure + jobs = price growth.
It certainly qualifies on the affordability score. It has numerous suburbs with median house prices below $300,000 and many others in the low-to-mid $300,000s. That affordability attracts a lot of people and its population is tipped to grow from 300,000 to 500,000 over the next 20 years.
An area needs to offer more than cheap housing to qualify as a hotspot and some have unkindly renamed the area Bogan City.
But Logan offers plenty in the way of infrastructure, services and amenities. Logan City is a 35 minute drive from the Brisbane CBD and the Gold coast via the Pacific Motorway - and is also well serviced by buses and trains on the Gold Coast and Beenleigh lines.
The area is especially strong on retail facilities. The Logan Hyperdome is among the largest shopping centres in Australia while furniture and homewares giant Ikea has a large outlet in Springwood. The Logan Mega Centre has 28 retail stores which mostly offer household and furniture outlets, but also camping and sporting goods.
There are plenty of schools throughout the region and there are also an unusually high number of golf courses.
Jobs nodes include Teys Australia, the second largest meat processor and exporter in Australia, based in Beenleigh. Teys, which employs 800 people, was inducted into the Queensland Business Leaders Hall of Fame in December 2014. Another landmark is the Beenleigh Rum Distillery which began operations in 1884.
Logan is also not far to the Gold Coast theme park precinct, which includes Dreamworld and Movieworld.
Investors like Logan City because, in addition to cheap prices and solid growth prospects, it has strong rental yields. Most suburbs have median house yields of 5.5% and above, with several between 6% and 6.5%. The median yield for units in Beenleigh, according to Domain, is 7.1%.
Most of the Logan City postcodes have vacancy rates below 2%, according to SQM Research.
In the past 12 months, a number of the suburbs of Logan City have recorded growth in median house prices between 8% and 12%.
Developers are increasingly targeting this area with large-scale projects, including a $600 million retirement village, a $550 million tourism village, a $200 million residential estate and the new Alma Park Zoo, which is being relocated from the north of Brisbane.
A number of the area’s icons – including the Logan Hyperdome shopping centre, the Beenleigh Rum Distillery and McNevin’s Motel Loganholme – are undertaking expansions.