A mere 3.85% of property investment experts believe Sydney offers solid prospects this year, a major drop from 11% in 2017, according to the Property Investment Professionals of Australia’s (PIPA) 2018 Member Survey.
Nearly half (46.15%) of respondents said Brisbane offered the best investment prospects for 2018. The Queensland capital was also the top pick by property investment professionals last year, with 44% of respondents selecting the city.
Melbourne was picked as the second best location for property investment this year (19.23%), down from 29% in 2017.
The third pick was Perth, which has shown signs of recovery over the most recent quarters. About 15.38% of respondents said the WA capital offered the best property investment prospects for 2018, a significant increase from 3.7% in 2017.
According to Peter Koulizos, chairman of PIPA, Sydney’s strong price growth over the past five years has resulted in its property investment metrics no longer adding up for sophisticated investors.
“Its sky-high property prices means that rental yields are constrained and smart investors aren’t prepared to make up the difference in cash flow from their back pockets,” Koulizos said.
He added that Brisbane’s affordability was one of the reasons why it was once again selected as the capital city with the best property investment prospects.
The huge difference in terms of affordability between Sydney and Brisbane was helping fuel interstate migration into the Sunshine State.
“When the numbers are literally two for the price of one, it’s no surprise that owner-occupiers and first-home buyers are opting to head north to southeast Queensland to take advantage of its more affordable property prices,” Koulizos said.
Michael Mata, Your Investment Property, 19 March 2018