Demand for townhouses in Logan primarily comes from owner-occupiers, a local sales agent says, with investors instead preferring higher-yield properties.
The principal of Ray White Waterford, Kate Handley, said the townhouse market had grown drastically in the last year.
“Since the start of the year, it has changed from the record price being $420,000 now up to $545,000,” she said, referring to a complex along Albert Street in Waterford.
“That is unprecedented in the townhouse market.
“In the 20 years I have done real estate, I have never seen a jump like that.”
Ms Handley credited the unaffordability of detached houses for the sudden growth.
“The average entry level market in our precinct has usually been around $550,000 for standard homes,” she said.
“This jumped because there are so many people wanting to purchase with low supply… so now your entry price is $650,000.
“Buyers don’t have that $650,000 to jump up to, so buyers look at the townouse market.”
This has also led to a market comprised mostly of owner-occupiers.
“I am selling 95% of these townhouses to owner-occupiers,” Mr Handley said.
“The investors aren’t there.
“A lot of investors shop by yield, and the yield just isn’t there.”
In one townhouse complex along Albert Street in Waterford, blocks that are essentially the same are selling for anywhere between $400,000 to almost $550,000.
“They are all the same floor plan, but they vary in terms of condition and they vary in terms of occupancy,” Ms Handley said.
“Some of them have tenants and some of them are available for you to move in.
“That is what is determining the prices – the premium prices being achieved are for properties that are renovated that you can move straight into.”
She said many of the townhouses already had tenants in place.
Unit 53/36 Albert Street is currently on the market for offers over $475,000.
The three-bedroom, two-bathroom townhouse “needs work” and has tenants with around seven months left on their lease.
Ms Handley said many buyers in the townhouse market were looking for their first home, and needed to move into the property straight away.
As the year draws to a close, Ms Handley said demand for townhouses was beginning to slow.
“At the start of the year when these properties were mid $400,000, you were getting big groups through and ten offers,” she said.
“Now you’re getting a couple of offers on them, so we’re certainly starting to see demand slow.
“I don’t foresee the same accelerated trajectory we’ve seen in the last 12 months continue again for the next 12 months because it would almost push most people out of the market,” she said.
