Brisbane’s record-breaking prestige market has raised sellers’ expectations of what their properties are worth but as Chinese buyers become locked out of the market, those expectations will have to become more realistic, agents say.
Jaw-dropping deals such as the $18.48 million sale of 1 Leopard Street, Kangaroo Point, have inflated sellers’ ideas of how much their house is worth, McGrath New Farm agent Henry Hodge said.
“Everyone knows about Leopard Street and how much it went for, so a lot of sellers assume their houses are worth more as a result,” he said.
“And while that’s true to a point, the problem is that the buyer situation has changed since then.”
Price Finder records show it was Chinese billionaire Zijian Zheng who purchased the clifftop luxury residence in March. Other significant sales include 390-402 Benhiam Street, Calamvale, which sold to a Chinese buyer for $7 million after only one week on the market.
However since then, Chinese authorities have clamped down on how much cash they allow their nationals to invest in foreign property.
“So the situation has changed,” Mr Hodge said. “The Chinese buyers are still here and they still want to buy but it’s a lot more difficult for them to get their cash out [of China].
“The days of the Chinese buyers coming along and paying over the market value have come to an end.”
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However Mr Hodge said it’s far from doom and gloom, with plenty of cashed-up local and interstate buyers willing to splash their millions in Brisbane.
“I wouldn’t discount the local buyers – they’ve got money,” he said. “They’re just a lot more savvy and really want to do their homework before signing a contract. While the Chinese are product-driven and often willing to pay whatever it takes to get the house they like, the local buyers are going to do their research first, which takes time.”
Nowhere is this more evident than in Hamilton, where this week a hilltop Queenslander reputed to have undergone one of the most extraordinary renovations in Brisbane’s history finally settled for $7.6 million after more than a year on the market.
Property records from Price Finder show 9 Anthony Street sold for $7.6 million on June 17.
The seven-bedroom, eight-bathroom property overlooking the Brisbane River included a fully automated dual-lane bowling alley, fitness centre with 25-metre lap pool and 1000-bottle wine cellar with a wine tasting room.
Ray White New Farm principal Matt Lancashire brokered the deal and said that while the restrictions on Chinese buyers were having an impact on who was buying, Brisbane’s prestige market was still having a record year.
“It’s the local buyers. They’re still buying. Brisbane is very undervalued compared to Australia’s southern states. Confidence in the Brisbane market is at an all-time high, and it is certainly not slowing down in the short to medium term.”
Mr Hodge said people selling their homes needed to be realistic and do their homework on what’s moving in their area.
“The crux of it is that the buyers are still there but they’re doing their homework first – they’re not coming in over odds like the Chinese were when they were swept up in buying property,” he said.
“The idea that people just drop $8 million-plus on a property without doing their research is a fairytale. Prestige buyers today need to have all their ducks in a row before they’ll take that leap, which can take a lot of time.”
Mr Lancashire was optimistic about the future.
“It is hard to fathom that much will change here over the next 12 months, if the last year is anything to go by. Brisbane real estate is seriously undervalued,” Mr Lancashire said.
By Ellen Lutton