THE fallout from southeast Queensland's housing boom is expected to last the rest of this year, with property analyst Louis Christopher describing the area as a "basket case". Mr Christopher, the managing director of SQM Research, told a Sydney property conference yesterday that house prices should not get too far ahead of nominal GDP, but in Brisbane's case, house prices were running 33 per cent ahead of GDP, while the national average was only 17 per cent.
"On any measure, Brisbane looks overvalued and will correct this year," he said. The region was suffering from an over-supply of stock, much of it fuelled by mums and dads' first, and probably last, property investment.
He said the southeast Queensland housing market peaked in 2008 but was now experiencing a "big crash", and was not the place for amateurs to invest.
While southeast Queensland has recorded the strongest population growth in the nation for most of the past two decades, this has slowed in the past year with other parts of the country -- particularly the western suburbs of Melbourne -- offering lower prices.
Start of sidebar. Skip to end of sidebar. .End of sidebar. Return to start of sidebar. Southeast Queensland's summer of natural disasters has also pushed down property prices.
The latest information from residential researcher RP Data claims median house prices in Brisbane dropped by 2 per cent in the final quarter of last year and 3.4 per cent over the full year.
Mr Christopher also said the middle and outer suburbs of Sydney would represent good value for investors over the next 12 months, especially if the incoming government took a decision to boost the city's housing market by cutting sales tax.
"There is an under-supply situation occurring for NSW. We are actually building less dwellings now than in 1984 and have been building less since the year 2000," he said.
"In 1984, the population of Sydney was about 3.2 million. We now have 4 million.
"This has translated into Sydney having the tightest vacancies of all capital cities, with vacancy rates hovering around 1.5 per cent."
