Brisbane s apartment supply hits four-year low

Brisbane’s apartment supply hits four-year lowSupply in Brisbane’s inner-city new apartment market has fallen to a four-year low as demand for stock continues, according to the ‘Inner City Brisbane Apartments Market Report’ for the March quarter.The latest report from Place Advisory shows that only 1225 apartments remained for sale at the end of March. According to the current sales rate, this quantity would supply the market for less than six months. The report also found the weighted average price increased by about 30 per cent, rising from $546,657 in the December quarter to $710,524.While the number of sales to March 2014 (639 apartments sold) was down on the record-breaking 1011 apartments sold in the December 2013 quarter, Place Advisory found that the sales rate was still well above historical averages, being almost twice the 10-year average of 326 unconditional sales per quarter. The drop in the March quarter was a natural correction, said Place Advisory, adding that sales rates in that quarter bode well for the coming 12-month period.The findings of the report point to a continued undersupply of new off-the-plan stock in the inner city. Some commentators contend that a proposed pipeline of apartments will soon lead to an oversupply in the Brisbane market, but Place Advisory rejects this. It states that many of these projects are unlikely to make it to the open market, with bank lending hurdles ensuring that only feasible residential projects will make it as far as the construction phase. The undersupply of apartments, it says, is set to endure in the short term.While investors have been active in Brisbane’s new apartment market, the rise in the weighted average price in the March quarter reveals a marked increase in the number of owner-occupiers entering the market. According to the report, this points to continuing improvement in sentiment, as well as an upswing in market conditions, which, in turn, is helping create urgency among buyers.The Place Advisory report can be found here