PROPERTY: Where house prices are going up by 7%
SYDNEY might be the epicentre of Australia's housing market, but it's homes in Brisbane and surrounding regions where the value looks to stay as safe as houses.
National researchers BIS Shrapnel have crunched the data to deliver its forecast for Australia's key housing markets from now until 2019.
The Sunshine Coast, Brisbane and Gold Coast are among the biggest winners, as north Queensland and Sydney are warned that house values could be starting to plateau.
BIS Shrapnel found the best prospects for average or median house price growth for the next three years is in Brisbane and Hobart.
Brisbane house prices are predicted to increase by 7% over the three years to 2019.
The Sunshine Coast and Gold Coast are described as moving "in tandem" with Brisbane house prices.
Less construction in past years means there is too little housing, according to BIS Shrapnel, which translates to tight vacancy rates.
"Both the Gold Coast and Sunshine Coast are now seeing moderate price growth come through," the report found.
House prices on the Sunshine Coast are predicted to increase by 7% -- slightly lower than the Gold Coast's 11% -- "with the major Sunshine Coast University Hospital largely completed and fewer new projects to sustain the local economy".
In North Queensland, the cooling of the mining and resources industries are likely to quell increases in house prices.
Prices should bottom out by 2018, BIS Shrapnel found, and would calm down after that.
Referring to Townsville and Cairns specifically, it found "it will still take time for an upturn to come through given vacancy rates -- which are currently at 6 per cent -- will take some time to tighten".
"Strengthening local economic conditions, with a lower Australian dollar contributing to strong growth in local and overseas tourism, are contributing to a more buoyant employment environment."
By June 2019, house prices in Townsville are expected to be 35% below the peak of December 2007.
Returning to Brisbane, "affordability has improved significantly after weak price performance", it found.
The rate of new construction is focused on apartments, meaning there will still be high demand for detached houses.
Low interest rates, and an average house price of $520,000 means that Brisbane's best buys should have already gone. But with Queensland's economy being hindered by the slowing of the mining industry, the market appears to be waiting to pick up.
"Brisbane's median house price remains six per cent below its June 2010 peak in real terms," the report found.
"Together with the low interest rate environment, affordability in Brisbane is at levels seen in the 2000s."
In Sydney, where the average house is $1.05 million, prices are expected to fall slightly by 2019.
At this time in 2019, house prices in Sydney are expected to be 1% lower after taking falls for the next two years.