- Sydney and London showed market under-performance after hosting the Games, though jobs and economic performance were significantly boosted
- Queensland leading the nation in population growth, attracting residents though affordability, lifestyle and economy factors
- Olympics only the icing not the cake says Pete Wargent, several other factors to consider before buying in
With the 2032 Brisbane Olympics on the horizon, investors are eagerly awaiting the expected boost to south-east Queensland’s economy and housing market.
However, as BuyersBuyers co-founder Pete Wargent warns, investors wanting to benefit from the global event will have to turn their focus to conducting granular research first.
Under-performance the price to pay for Olympic boost
Mr Wargent agreed there may be truth in the popular belief that the host city of the world’s most prestigious sporting event will consequently experience a surge in aggregate demand.
“Everyone talks about Sydney’s boom when house prices all but doubled over half a decade up to 2001, for example, and the Olympics may have played a part in that story, with prices booming in the lead up to the event,” he said.
Mr Wargent highlighted however, that interest rates were raised twice following the Games in an effort to slow the growth rate, resulting in Sydney under-performing against all capital cities for six or seven subsequent years.
Australian Residential Price Indexes
London hosts boroughs sustain out-performance
A similar scenario played out in London at the time of the 2012 Olympics, as prices rose 37% between 2009 and 2014, although the market has performed dismally since 2017.
“The takeaway message from London was the massive regeneration which took place in areas like Stratford and Newham, or the other London boroughs to host the Olympics, such as Barking & Dagenham, Waltham Forest, Greenwich, Tower Hamlets, and Hackney.
“Not only did all of the host boroughs experience sustained out-performance in property prices over the course of a decade, but the regeneration schemes in many cases resulted in a lasting transformation,” Mr Wargent said.
UK Average House Prices by Region (GDP)
While Mr Wargent acknowledged that applying the regeneration schemes had its difficulties and not everyone stood to benefit, the overall impact was positive with jobs and economic growth in the host boroughs surpassing other areas long after the torch had been passed.
Affordability, lifestyle and economy drawing residents
Doron Peleg, BuyersBuyers CEO and co-founder, explained that Sydney and Melbourne were out-performers in the economy and housing market of the past decade, prompting south-east Queensland to strengthen its affordability against its south-of-the-city counterparts.
The strength of the coastal market in south-east Queensland, in conjunction with the rise in flexible working arrangements, drove significant migration patterns last year and placed Queensland in the national lead for population growth.
“The lifestyle areas of the Gold Coast and the Sunshine Coast, which enjoy very good access to Brisbane, are experiencing outstanding demand as more Australians look for a sea-change. This, with the planned improvements in the infrastructure, will only increase that trend.”
Doron Peleg, BuyersBuyers CEO
In addition to the attractive affordability and lifestyle factors, the Queensland economy has shown significant improvement recently that will also act as a drawcard for residents.
“As for the direct impact of the Olympics? The Games will certainly add significantly to long-term projections. The hosting of the Olympics is expected to cost at least $5 billion, but when we include all of the likely associated infrastructure, the total investment will greatly exceed this figure.
“These investments not only will create jobs, but they will also provide substantial improvements to the infrastructure in Brisbane and south-east Queensland” Mr Peleg said.
Investors urged to conduct granular research before buying in
Mr Wargent advises investors keen to cash in on the Brisbane Olympics boom to do their research and get granular.
Mr Wargent highlighted the suburbs of Woolloongabba, Dutton Park and Albion as areas of potential that will receive infrastructure investment in preparation for the Games.
He added that while most areas like these typically hold some desirable property types, it’s important to do your due diligence and consider all factors such as flood risk and noise levels when selecting an investment property.
“The Olympics coming to Brisbane is uplifting news, no doubt. It will put the city on the international map, and the associated investment in infrastructure will be very welcome.
“But remember this is only one factor of many impacting the housing market, and if your goal is specifically to benefit from the Olympics, then you’ll need to conduct more granular research,” Mr Wargent concluded.
