RESIDENTIAL RESEARCH - Knight Frank
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RESIDENTIAL RESEARCH LIVING & STUDYING BUYING PROPERTY WHY INVEST?
Contents
1. Brisbane—The new world city
page 2
2. Living in Brisbane
page 4
3. Studying in Brisbane To sustain an emerging global city, there
page 7 must be viable opportunities to attract Quality of Living 2018
globally scalable industry sectors and Index of 233 global cities ranked on internal
4. Housing in Brisbane stability, crime, law enforcement and
create a highly desirable place to do
page 10 relationships with other countries
business. Brisbane is rapidly emerging as
5. Renting in Brisbane a leader in this space while enabling 1. Vienna, Austria
page 11 affordable urban precincts to live, work
2. Zürich, Switzerland
and collaborate for higher education,
6. Buying in Brisbane research, start-ups and technological =3. Auckland, New Zealand
page 12 innovation. This guide focuses on living,
studying and buying residential property =3. Munich, Germany
7. Buying as a First Home Buyer
in Brisbane. 37. Brisbane, Australia
page 13
8. Buying as a Foreign Investor
page 14
Liveability
Brisbane ranked in 22nd place of the
9. Owning in Brisbane World’s Most Liveable Cities in 2018
page 19 according to the Economist Intelligence
Unit, as shown in Table 1. The index is City Wealth Index
10. Selling in Brisbane based on 30 factors spread across five The Knight Frank City Wealth Index 2018
page 20 areas: stability, infrastructure, education, ranked Brisbane 49th of the cities that
health care and environment. matter to the ultra-wealthy. Across the
Feature:
10 reasons to invest in Brisbane four categories, Brisbane performed best
page 22 in the ‘investment’ category (54th) based
on the annual average private investment
Most Liveable Cities 2018
Index of 140 global cities based on Stability, into property over 2016 and 2017. The
Infrastructure, Education, Health Care ‘future’ category also scored well (57th),
& Environment
considering future economic performance
1. Vienna, Austria (GDP) measured in constant prices.
2. Melbourne, Australia
3. Osaka, Japan
Knight Frank City Wealth Index
22. Brisbane, Australia
2018, Brisbane
314 international cities ranked in each category
Ranking
Wealth 76
Quality of Living Investment 54
Mercer placed Brisbane in equal 37th Lifestyle 141
position, from 233 cities, in their Quality Future 57
of Life index as shown in Table 2. This
OVERALL 53
index is ranked on internal stability,
crime, effectiveness of law enforcement
and relationships with other countries.
2
FOCUS ON BRISBANE Q2 2019 RESEARCH
International with unrivalled local, national and
international labels and flagship stores.
Visitors FAST FACTS
Brisbane is the gateway to Queensland’s Luxury brands are found along Queens
famous attractions with many local and Plaza within the mall, Edward Street and BRISBANE
international events held throughout the Wintergarden, with its striking and
year. colourful metallic webbed entrance. • Brisbane is the state capital of
Queensland (Qld).
A drive from Brisbane to the Gold Coast Fortitude Valley, on the edge of the CBD,
• Australia’s third largest capital
is approximately one (1) hour by road. provides a range of shops supporting
city, with approximately 2.4
Many of Australia’s largest theme parks local designers with luxury designers million residents estimated
are located on the Gold Coast. The home along James Street. Heritage living in the Greater Brisbane
destination is popular with families, buildings contrast modern, edgy region in 2017.
catering to all age groups and particularly buildings—much like the shopping
in school holiday times. experience. • Located on the East Coast with
a geographic area of
15,800 sqm.
Queensland is also home to one of the The number of international visitors to
most renowned natural wonders of the Queensland grew 2.3%, to total • Hot and humid sub-tropical
world—the Great Barrier Reef. A flight 2.8 million, in the year ending December summers (mean maximum 29°
from Brisbane to the serene Hamilton and 2018. The most number of international C) and warm winters (mean
Hayman Islands arrives within two (2) visitors came from China (502,000), New average of 10°C).
hours of take-off, a perfect weekend Zealand (483,000), United States
• Most daily sunshine is 11 hours
away for locals and tourists alike. (229,000), United Kingdom (227,000) and in the month of January.
Japan (208,000) as shown in Figure 1.
Brisbane accommodates a vast array of • Brisbane operates under the
renowned restaurants, art galleries, International visitors from Singapore, Australian Eastern Standard
independent fashion houses and vibrant Malaysia and Hong Kong grew by 11.2% Time (AEST) time zone at all
times of the year.
retail strips. Queen Street Mall, in the in the year ending December 2018, while
heart of Brisbane CBD, offers a Taiwan and France increased by 9.4% • From Brisbane, current
pedestrian-only shopping district, lined and 9.3% respectively. average flying travel time is
approximately eight (8) hours
to Singapore and Kuala
Lumpur, nine (9) hours to Hong
Kong and Jakarta, 11 hours to
Shanghai and 13 hours to
Beijing.
International Visitors to Queensland, by Country of Residence
Total number, year ending December 2018 • Brisbane is located in the
‘Sunshine State’ and home to
China one of the natural wonders of
New Zealand the world—the Great
U.S Barrier Reef.
U.K
Japan
Other Countries
Other Europe
Germany
Taiwan
Korea
India
Hong Kong
Singapore
Canada
Other Asia
Malaysia
France
Scandinavia
Italy
Netherlands
Switzerland
Indonesia
Thailand
0 100,000 200,000 300,000 400,000 500,000 600,000
3
Brisbane’s Cantonese (0.9%), Spanish (0.7%) and
Hindi (0.6%).
Demographic
Profile Education
Population Brisbane is a skilled city. A higher
Population has been steadily rising in proportion of people are educated at
Brisbane with recent interstate migration university level (22.9%) compared to the
into the city. Over the year to 30 June Australian average (22%). In Brisbane,
2017, an increase in the estimated 18.7% of the local student population
BRISBANE resident population was recorded at were studying at university in the 2016
ANNUAL EVENT 2.0% to 2.4 million. This is ahead of the Census, compared to the national
average of 16.1%.
CALENDAR overall Australian population growth of
1.6%. According to the Australian Bureau
JANUARY of Statistics (ABS), the Brisbane
• Brisbane Chinese New Year population is projected to grow annually Work
Festival by a minimum of 1.8%, to total 3.5 million
• Australia Day Brisbane The most common occupation of
persons by 2036.
Celebrations Brisbane’s residents are in professional
services—at 22.9% compared to the
FEBRUARY
• Brisbane Comedy Festival Age Distribution national 22.2% average. Clerical and
• BrisAsia Festival administrative workers (14.8%),
Residents are primarily young to middle
MARCH technicians and trades workers (13.0%)
aged—with 36% of Brisbane’s
• Brisbane Irish Festival and managers (11.8%) were the next
population aged between 15 and 39
• World Science Festival most common occupations.
years old compared to the national
APRIL average of 33.9% for this age group.
• Brisbane to Gladstone Yacht Of all the employed people in Brisbane,
Race 4.4% worked in hospitals. Other major
MAY Multiculturalism industries of employment included
• Brisbane Street Art Festival The Brisbane population is on par with primary education (2.4%), cafés and
• Brisbane Winter Racing Carnival the national average —with 32.2% of the restaurants (2.3%), state government
JUNE city’s residents being born outside of administration (2.3%) and supermarket
• Brisbane Racing Carnival Australia. The most prominent countries and grocery stores (2.3%).
• Oxfam Trailwalker
of birth include New Zealand (4.7%),
JULY England (4.0%), China (1.6%), India
• Queensland Music Festival (1.6%) and South Africa (1.0%). In Travel to Work
AUGUST addition, approximately 31.9% of
In Brisbane at the time of the Census
• The EKKA Brisbane Show Brisbane’s residents’ parents were born
• Brisbane Night Noodle Markets 2016, the most common methods of
overseas—slightly below the national
• Mercedes-Benz Fashion Week travel to work for employed people were
average of 34.4%.
SEPTEMBER by car, as a driver (61.2%), car, as a
• Brisbane Festival passenger (5.0%) and bus (4.7%). Other
• Riverfire Finale Religion common responses were worked at
• Brisbane Writers Festival home (4.6%) and train (3.6%).
The Catholic religion was practiced by
OCTOBER 21.5% of Brisbane residents at the time
• Oktoberfest Brisbane On the day, 11.6% of employed people
of the Census 2016, this was followed by
• Brisbane International Film used public transport (train, bus, ferry,
Festival Anglican at 13.3%, then Uniting Church
tram/light rail) as at least one of their
with 4.6%. No religion was the most
NOVEMBER methods of travel to work and 69% used
• Asia Pacific Screen Awards common response in Brisbane with
car (either as driver or as passenger).
• Wonderland Festival 30.6% of the population.
DECEMBER
• Asia Pacific Screen Awards Language
• Christmas in the City Key Employment
Celebrations Other than English, Mandarin (2.4%) is
• Brisbane New Year’s Eve the most common language spoken in a Hubs
Fireworks Brisbane household. Other typical The distribution of employment
languages include Vietnamese (1.0%), opportunities are wide across Brisbane,
4
FOCUS ON BRISBANE Q2 2019 RESEARCH
although there are key concentrated Hospital, Brisbane Private Hospital and to companies with synergy to the airport
areas for office and industrial workers. Brisbane Central State School. and/or logistics. This precinct also
Accessible by: train, bus and car. accommodates retail outlets.
Accessible by: train, bus and car.
Commercial Toowong is concentrated around
Brisbane CBD is the largest office market Toowong Village and Train Station and
in Brisbane. It extends around the bound by Anzac Park, Mt Coot-tha Industrial
Brisbane River from North Quay, cutting Botanic Gardens, and Toowong Park and Industrial areas are more spread across
across Alice Street, north along the Brisbane River to the south. the metropolitan area varying from
Boundary Street, south on Turbot Street Accessible by: train, ferry, bus and car. distribution centres to warehouses and
then south of Roma Street Station and industrial estates. Mostly they are
Transit Centre. Workers regularly access Urban Renewal Precinct incorporates the accessible via bus, truck and car.
the Brisbane City Botanic Gardens and vibrant urban precincts of Fortitude
Roma Street Parkland at lunchtime. Valley, New Farm, Teneriffe, Newstead North: Brendale, Geebung.
Accessible by: train, ferry, bus, car and and Bowen Hills with many vantage
footbridge from the Inner South. points along the Brisbane River. South East: Rochedale, Yatala, Ormeau,
Accessible by: bus, car, train and/or ferry. Stapylton.
Milton office accommodation is located
further around the Brisbane River and Inner South sprawls south of the South West and Outer South West:
based around Milton Train Station, Brisbane River to include locations such Richlands, Darra, Redbank, Ipswich.
extending through Petrie Terrace, skirting as Southbank, South Brisbane,
Suncorp Stadium and Gregory Park. West End, Woolloongabba, Kangaroo South: Berrinba, Acacia Ridge,
Accessible by: train, ferry, bus and car. Point, East Brisbane and Greenslopes. Heathwood, Parkinson, Salisbury.
Accessible by: bus, car, train, ferry and/or
Spring Hill adjoins the CBD to the south, footbridge from CBD. Trade Coast: Lytton, Eagle Farm,
and Victoria Park Golf Course to the Pinkenba, Hendra, Hemmant,
north and includes St Andrews Memorial Brisbane Airport Precinct is mostly home Morningside, Murarrie, Airport, Port.
Brisbane
Major infrastructure network
5
6
FOCUS ON BRISBANE Q2 2019 RESEARCH
Schools Universities single student visa regardless of their
chosen course of study and the Student
Schools in Australia generally comprise a Most universities have a main campus Guardian Visa—Subclass 590 where
mix of local and international students. with several smaller campuses located student guardians can apply for the new
The education system is broadly divided across multiple states and territories; in Student Guardian Visa.
into primary (aged 5-12) and secondary CBD, metropolitan and regional areas.
(aged 13-18). There are two main types This provides a wide range of options All students and student guardians will
of public and private schools: when studying in Australia with many generally be required to lodge their visa
universities also setting up campuses application online by creating an
based in major international cities. ImmiAccount.
Public Schools
Public schools are financially and
administratively operated by the State
Government and provide free education
International
to domestic students. First preference is Students
normally given to those living within a Reflecting the good reputation
particular catchment area from the internationally, universities in Queensland APPLICATION
school. Student visa holders must pay a accommodate a large international PROCESS FOR
fixed fee for each year of education, student base. International student
dependent on the type of visa held.
INTERNATIONAL
enrolments in Queensland increased
9.1%, to 135,000, in 2018. Higher
STUDENTS
Selective public schools are financially Education had the most demand in
and administratively operated by the student enrolments with 51,150, while
State Government. Selective public international enrolments in Schools
TO SCHOOL
schools are regarded as more prestigious represented 5,950 students. Expression of interest form: must
due to the academic selective nature. be completed prior to the school
Students must sit academic examination Across all education sectors, the largest year in order to guarantee a
and excel in order to be offered a group of international students enrolled in position for the student.
position from the respective school. Queensland are from China (30,900),
India (13,700), Brazil (12,480), South Wait for offer: If all requirements
Additionally, these selective public Korea (7,260) and Colombia (6,270). are met, the school will offer a
schools do not usually limit their intake to formal placement in writing.
catchment areas. Due to their public The application process for international
nature, student visa holders must pay a students applying to Australian Apply for a Student Visa: With the
fee for each year of education. universities is similar to local students. formal school offer, students can
The length of the application process can then apply for the SSVF online.
Private Schools often be longer than local students, as
more information is required before
Independent schools are financially and
acceptance.
administratively privately operated. TO UNIVERSITY
Independent schools therefore hold more Apply directly online: through the
Most universities will require an IELTS
control over the quantity and quality of university website and provide all
(International English Language Testing
teachers, classroom sizes, amenities and required evidence. In most
System) examination conducted, an
co-curricular activities. Fees for instances this is prior education,
internationally recognised education
independent schools are usually high, but financial and English language
qualification and a portfolio of previous
can be considered to provide an competence.
work experience where applicable.
investment for superior education and
amenities to students. Wait for Offer: If all requirements
The Simplified Student Visa are met, the university will offer a
Religion-based schools hold faith at the Framework (SSVF) formal placement in writing.
core of their education—however they The Simplified Student Visa Framework
continue to follow the state government (SSVF) is designed to make the process Apply for a Student Visa: With the
education curriculum. These religion- of applying for a student visa in Australia formal university offer, students
based schools are usually non- simpler to navigate via two subclasses: can then apply for SSVF online.
government, and thus often have higher
fees than government subsidised Student Visa—Subclass 500 where
schools. international students can apply for a
7
Private Schools for International Students, Brisbane Sample of private schools registered to accept international students, 2019 S ub ur b S chool R elig ion Gend er Year Lev els As cot St Margaret's Anglican Girls School Anglican Girls pre-K-12 As hg r ov e Marist College Catholic Boys 5-12 B ald Hills St Paul's School Anglican Co-ed pre-K-12 B oond all St Joseph's College (Boondall) Catholic Boys 5-12 B r is b ane Catholic Education Archdiocese of Brisbane Catholic Boys pre-K-12 B r is b ane Brisbane Grammar School Non-denominational Boys 5-12 B r is b ane All Hallows' School Catholic Girls 5-12 B r is b ane St Joseph's College (Gregory Terrace) Catholic Boys 5-12 B r is b ane St James College Christian Co-ed 7-12 B r is b ane Brisbane Girls Grammar School Non-denominational Girls 7-12 B r is b ane Anglican Church Grammar School Anglican Boys K-12 Cab ooltur e Grace Lutheran College (Caboolture) Lutheran Co-ed 7-12 Cannon Hill Cannon Hill Anglican College Anglican Co-ed pre-K-12 Cannon Hill St Oliver Plunkett School Catholic Co-ed pre-K-6 Car ind ale Citipointe Christian College Christian Co-ed pre-K-12 Clay field Clayfield College Presbyterian & Uniting Girls pre-K-12 Cor ind a St Aidan's Anglican Girls' School Anglican Girls K-12 D utton Par k St Ita's Primary School Catholic Co-ed pre-K-6 D ak ab in Northpine Christian College Catholic Co-ed pre-K-12 E nog g er a Hillbrook Anglican School Anglican Co-ed 7-12 E v er ton Par k Northside Christian College Christian Co-ed pre-K-12 For es t Lak e St John's Anglican College Anglican Co-ed pre-K-12 Good na Westside Christian College Protestant Christian Co-ed pre-K-12 Hawthor ne Lourdes Hill College Catholic Girls 7-12 Hend r a Our Lady Help of Christians School Catholic Co-ed pre-K-6 I nd oor oop illy St Peters Lutheran College Lutheran Co-ed pre-K-12 Kang ar oo Point St Joseph's Primary School Catholic Co-ed pre-K-6 Kar awatha Islamic College of Brisbane Islamic Co-ed pre-K-12 Kar r ab in West Moreton Anglican College Anglican Co-ed pre-K-12 Kep er r a St Williams School Catholic Co-ed pre-K-6 M ans field Brisbane Adventist College Christian Co-ed pre-K-12 M itchelton Mt Maria College Catholic Co-ed 7-12 New Far m Holy Spirit School Catholic Co-ed pre-K-6 Nund ah Mary MacKillop College Catholic Girls 7-12 Or mis ton Ormiston College Christian Co-ed pre-K-12 Par k R id g e St Philomena School Catholic Co-ed pre-K-12 R oched ale Redeemer Lutheran College Lutheran Co-ed pre-K-12 R othwell Mueller College Community Co-ed pre-K-12 R othwell Grace Lutheran College (Rothwell) Lutheran Co-ed 7-12 S alis b ur y Brisbane Christian College Christian Co-ed pre-K-12 S car b or oug h Southern Cross Catholic College Catholic Co-ed pre-K-12 S held on Sheldon College Non-denominational Co-ed pre-K-12 S outh B r is b ane St Laurence's College Catholic Boys 5-12 S outh B r is b ane Somerville House Presbyterian & Methodist Girls pre-K-12 S unny b ank St Thomas More College Catholic Co-ed 7-12 The Gap St Peter Chanel Primary School Catholic Co-ed pre-K-6 Toowong Stuartholme School Catholic Girls 7-12 Toowong Brisbane Boys' College Presbyterian & Methodist Boys pre-K-12 Toowong St Ignatius' School Catholic Co-ed pre-K-6 Up p er M t Gr av att Clairvaux MacKillop College Catholic Co-ed 7-12 Welling ton Point Redlands College Churches of Christ Co-ed pre-K-12 Wood end St Mary's College Catholic Girls 7-12 Wooloowin Holy Cross Primary School Non-denominational Co-ed pre-K-6 Z illmer e St Flannan's School Catholic Co-ed pre-K-6 8
FOCUS ON BRISBANE Q2 2019 RESEARCH
Universities, Queensland
Universities accepting international students
Annual Average
World Australian Number of International
Adjusted International
University Name Ranking Ranking International Students % of
Graduate Salary Student Fees
2017 2017 Students Total Students
University of Queensland 60 6 $49,752 11,236 23% $34,000
Queensland Uni. of Technology 292 11 $47,548 7,525 16% $28,000
Griffith University 353 8 $48,531 8,432 19% $24,000
James Cook University 377 16 $53,404 6,211 29% $25,000
University of Southern Queensland 805 22 $52,191 4,548 18% $21,000
Bond University 880 13 $49,204 1,763 35% $33,000
University of the Sunshine Coast 1,535 24 $47,046 1,921 14% $21,000
Definitions
World Ranking is calculated by averaging the ranking produced by QS World University Ranking, the Shanghai Academic Ranking of World Universities and Webometrics web publishing
rankings.
Australian Ranking is calculated from the combined score for World Ranking (reputation), Graduate Satisfaction (ratings) and Adjusted Graduate Salary (results).
Adjusted Graduate Salary is a measure of how well students are doing in the job market some months after graduating based on graduate salaries, rates of unemployment and the proportion
of students who go onto further study.
Annual International Student Fees are an estimate only. It is highly recommended to engage directly with the Australian university for information on the cours e and fees applicable.
Further information is available at univeristyreviews.com.au
9
The ‘Great Australian Dream’, a house
standing on a ‘quarter acre block’, is still • Oxley
Distribution of Tenure, Brisbane
relatively affordable across Greater % of private dwellings
• Queen’s Wharf
Brisbane and within close proximity to • Woolloongabba
the city and fringe. Although with our • Yeronga
fast-paced lives, many are now choosing
low maintenance living and opting for To deliver new well-planned communities
apartments in complexes with high ‘growth by consolidation’ in ‘Shaping
amenity. This is becoming particularly SEQ’, has been identified in key locations
popular with downsizing households. This including:
reinforces the changing demand across • Knowledge and technology precincts:
the metropolitan area for public parklands CBD, Dutton Park/Buranda, Herston,
St Lucia, South Brisbane, Kelvin
and shared facilities.
Grove, Gardens Point and
Auchenflower/Toowong.
• Brisbane north-east, south, south-west
Dwelling Types and east rail transport corridor:
Toombul, Strathpine, Caboolture/
Standalone houses (also known as
Morayfield, Logan Central, Beenleigh,
landed) continue to be the most dominant OWNED WITH MORTGAGE Meadowbrook, Toowong,
dwelling type in Brisbane, representing RENTED
Indooroopilly, Wynnum Central,
OWNED OUTRIGHT
76% of all dwellings. This trends higher NOT STATED Cleveland.
• Northern, Eastern & South East
OTHER
than the national average of 73% given
the greater volume of lower density Busway corridors: Chermside,
property. Carindale, Capalaba, Upper Mount
Gravatt, Springwood, Nathan/Coopers
Plains.
Similarly, semi-detached, row or terrace
houses and townhouses, with a compact
Considering ‘growth by expansion’ has
backyard, comprised a 10% share;
trending lower than the national share of
Growth precincts been identified in key locations including:
• Bahrs Scrub
12.7%. A little under 13% of dwellings The Queensland government has
identified key locations across Brisbane
• Caboolture West
are flats or apartments – compared to the
national average of 13.1%. suitable for rejuvenation with new homes • Flinders
and jobs. • Greater Flagstone
• North Lakes/Mango Hill
Ownership The employment growth action plan to • Park Ridge
deliver ‘Australia’s New World City’ • Southern Redland Bay
In Australia, most residential dwellings
identifies key precincts: • Warner
are purchased as freehold property, that
• Boggo Road/Princess Alexandra • Yarrabilba
is, the land and building are owned Hospital/The University of Queensland
outright, in perpetuity, under the Torrens • Herston/Kelvin Grove
Title system.
• Upper Mt Gravatt/Eight Mile Plains Prime properties
• City Reach
The same exists for Strata Title, although Prime properties, considered the top 5%
• City West
ownership allows individual ownership of of the residential market by value, are
part of a property (or ‘lot'), combined with
• South Brisbane, including Kurilpa mostly located close to, or dotted
shared ownership in the remainder, or • Australia TradeCoast around, the Brisbane River. Well-
common property, through a legal entity • Valley Gateway respected private schools located in
called the owners corporation (see further these suburbs attract both local and
information on page 19). Brisbane sites identified for specific international families alike.
accelerated development as Priority
Across Brisbane, on the night of the Development Areas (PDAs), with a focus New Farm is considered the most
Census 2016, 26% of residential private on economic growth currently include: expensive suburb by value, according to
properties being lived in were owned • Bowen Hills Australian Property Monitors (APM). This
outright, whilst 36% were owned with a • Fitzgibbon is followed by Teneriffe, Chandler, Ascot,
mortgage. The remainder (35%) were • Herston Quarter Hamilton, Bulimba, Fig Tree Pocket,
being rented from a landlord. • Northshore Hamilton Hawthorne, Pullenvale and Clayfield.
10FOCUS ON BRISBANE Q2 2019 RESEARCH
The process of renting (also known as in a trust. At the termination of the
leasing or letting) a residential property tenancy agreement, if the property is
can vary in each state, but generally the vacated and left in a suitable condition,
main factors for a tenant to consider are the bond will be repaid in full to the
outlined below. tenant.
Tenancy Agreement Utility & Service Charges
A tenancy agreement (property lease) is a Responsibility for utility charges will be
contract where one party conveys stipulated within the tenancy
property to another for a specified period agreement—this is not always covered by
of time, in return for a regular payment. the landlord. Although, the landlord must
When leasing out a property, the owner pay for the actual installation and initial
receives an income, but there are connection costs for electricity, gas, oil
maintenance costs and responsibilities and water supply. If these need replacing,
for the landlord. then the landlord must replace them to
the minimum efficiency standards.
Before signing a tenancy agreement, a
tenancy application must be submitted to
the real estate agency (property manager)
Inspections & Repairs
with proof of identity, ability to meet Throughout the tenancy, the property will
rental payments and good references. be periodically inspected by the landlord
or property manager. A minimum of
seven (7) days notice will be given with
Rent the purpose of these inspections being to
As stipulated in the tenancy agreement, check the maintenance of the property.
the tenant agrees to regularly pay rent to
the landlord. Most times this is Repairs to the property that are due to
conducted via a property manager and the normal wear and tear of the property
rent can be paid weekly, fortnightly or must be paid for by the landlord.
monthly. Any future increases will be Repairs classified as ‘urgent’ must be
stated within the tenancy agreement as completed as soon as possible, while
the landlord cannot increase the rent until ‘non-urgent’ repairs must be taken care
the end of the fixed term, unless of before the 14 days of notification.
otherwise stated.
Furniture
Term Generally, residential properties do not
The length of a tenancy agreement can come furnished, although this becomes
vary, however the standard term is more common for a rental property closer
usually six (6) or twelve (12) months for to the CBD. This will be clarified in the
the initial agreement although alternate tenancy agreement.
periods may be negotiable dependant on
the requirements of the landlord and/or
tenant. Once a tenancy agreement
Terminating the Tenancy
expires, the tenant can request a new A tenancy can be terminated at the
fixed term, or alternatively the tenant can conclusion of the tenancy agreement.
stay in the premises at the same rent and However, both landlord and tenant can
conditions until advised. request to end the tenancy for a variety of
reasons. Certain conditions must be met
before it can be terminated, including
Bond days of notice, number of notices and
A bond is a lump sum payment paid reason for termination.
upfront by the tenants as security before
moving into the property. This lump For further information, contact
sum—usually four (4) weeks rent—is held Residential Tenancies Authority.
11The Process inspection to guarantee the quality of the should the market slow over this time.
building and be aware of maintenance It’s wise for this type of investment,
The process to purchase a residential
required. especially with smaller and unknown
property can vary widely but the most
developers, that contracts are reviewed
common steps are outlined below. For
Negotiate by private treaty the highest by legal representation and the ‘sunset
further information and clarity, consult
price willing to be paid for the property clause’ explained, which places a
with your legal representative.
with the vendors (via the selling agent) or deadline for the construction timeline.
alternatively bid at public auction. Should a development not proceed,
Finance Representation deposits will be returned, but could be at
Before starting the journey to purchase a Holding deposit is recommended for a the expense of missed interest and
residential property, carry out due private treaty until cooling off ends (say, capital gains through other investments.
diligence of the subject property and $1,000) until formal finance is approved;
surrounding area to ensure the price at this time the full deposit (say, 10%) is There can also be more tax depreciation
expectation can be achieved with the paid. If bid was accepted at auction, the available on new properties, meaning
allocated budget. full deposit is payable at this time (say, maximising benefits and improving after-
10%) with any cooling off period now tax cash flow for investment properties.
The lending environment has become void. The deposit is generally paid by
challenging in recent years, when seeking cheque or electronic transfer (private
a loan from a financial institution. Many treaty only). General Costs
local banks will only lend if 20% of the When buying property in Australia, there
deposit has been saved and there is Contracts are signed and exchanged by
are both federal and state taxes and a
good evidence the property loan can be both parties and it’s time the solicitor (or
range of fees that are implemented.
repaid regularly with the property loan conveyancer) finalises the formal
based on market value. Shop around as paperwork with the lender. Loan
mortgages and deposits can vary documents are signed. Transfer Duty
significantly between providers. Transfer duty (also known as Stamp
Settlement occurs when the property
Duty) is levied by the state government
officially changes ownership, following
on the purchase of property.
Legal Representation one final inspection on the day and the
Engaging a solicitor or conveyancer prior locks are changed.
to purchasing the property is highly Legal Fees
recommended so they can review the Legal fees will vary between legal firms
Buying Off-The-Plan
contract before signing, and then stay and may be dependent on property
engaged throughout the process until the In most cases, buying off-the-plan (OTP)
value. Generally fees range from $1,000
property settles (when the property is the commitment to buy a property
to $3,000 plus GST.
officially changes ownership). that’s not yet built.
An OTP property can be better priced Land Transfer Fee
Buying Established Property than established stock as developers are When a property changes ownership, a
Search for a property priced to match keen to secure the project so lenders will document known as a Land Transfer is
requirements for location, proximity to provide funding so construction can lodged and registered with the Office of
transport, work and education and the commence. There is also the potential State Revenue, and a fee is charged. It is
quality, size and age of the dwelling. flexibility at this time to make design this document that records the change of
Staying abreast of comparable sales will changes to an apartment or house prior ownership. The cost to register the title
assist in the negotiation process. to turning sod. varies in each state of Australia. A
solicitor or conveyancer will perform this
Inspect the property at an open house or In most cases a deposit, typically 10%, is task on your behalf.
by private appointment. Request a copy paid to the developer and the remaining
of the contract and have solicitor (or is paid on settlement of the property,
conveyancer) read over the document. allowing more time to save throughout Mortgage Application Fee
the construction period. Through this A fee charged by the state government
Gain pre-approval for loan from lender time, the market may push market values for the registration of a mortgage. A
and confirm qualification from FIRB if up, at an advantage to the buyer, at the lender will perform this task on your
required. Arrange a pest and building same time consideration must be made behalf.
12FOCUS ON BRISBANE Q2 2019 RESEARCH
Both the Australian and state home. The scheme allows Australians to
governments provide incentives for make voluntary contributions of up to First Home Owner Grant Eligibility
Australian first home buyers. $15,000 in any one financial year, to a Criteria
maximum $30,000 across all years. This First Home Owners’ Grant
Incentives for includes undeducted (non-concessional)
personal contributions, deducted Queensland; including Brisbane & Gold Coast
First Home Buyers (concessional) personal contributions and
salary sacrifice contributions. These
Threshold (the property must valued less than)
in Australia contributions, which are taxed at 15%, Buyer of new property $750,000
along with deemed earnings, can then be
First Home Super Scheme withdrawn for a deposit if the eligibility
Conditions
The Australian Government, from 1 July criteria is met. Dwelling must be new, unless specified;
2017, has allowed individuals to make
Persons must be a minimum age of 18 years;
voluntary concessional (before-tax) and Concessional contributions and earnings
non-concessional (after-tax) contributions that are withdrawn will be taxed at At least one applicant is a natural person and an
into superannuation funds to fast-track marginal rates less a 30% offset. Australian permanent resident or citizen;
the time taken to purchase a new home Contributions made under this scheme
The contract date must be on or after 1 July 2018;
under the First Home Super Scheme are not a new type of contribution. They
(FHSS). Since 1 July 2018, individuals are voluntary contributions made to your You or your spouse must not have previously
can apply to release these voluntary superannuation fund. As a result, a received a first home owner grant in any state or
territory of Australia. If you received a grant that you
contributions, along with associated separate special account doesn't need to later paid back, together with any penalty, you may
earnings, to assist in purchasing their first be established nor does the fund need to be able to reapply for the grant;
be notified.
You or your spouse must not currently or previously
owned property in Australia that you lived in, or
For further information, contact the
First Home Super Scheme Eligibility Australian Taxation Office. owned a home before 1 July 2000 whether you lived
Criteria, Australia in or not. However if you owned an interest in
First Home Super Scheme (FHSS) residential property since this time, for investment
purposes (with evidence), you may be eligible;
Conditions
Incentives for First Must live in new home as principal place of
First home buyer – never owned property in Australia
– this includes an investment property, vacant land,
Home Buyers in residence continuously for at least 6 months within
the first 12 months of settlement.
commercial property, a lease of land in Australia or a
company title interest in land in Australia;
Queensland
First Home Owners’ Grant
Must live in the premises you are buying, or intend
to as soon as practicable; Queensland First Home Owners’ Grant is
home is valued at $500,000 or under, the
currently available. An eligibility criteria
Must intend to live in the property for at least first home concession amount will match
must be met before the grant is issued.
six months of the first 12 months you own it, after it the home concession rate resulting in no
is practical to move in; duty payable. First home vacant land
concession only applies to vacant land
Superannuation contributions can be from any age First Home Owner Grant Available
but persons must be a minimum age of 18 years to First Home Owners’ Grant
valued under $400,000.
request for funds to be released;
Queensland; including Brisbane & Gold Coast Only one of these concessions can be
Not previously requested the Commissioner to issue
a FHSS release authority;
claimed, with similar eligibility as the First
Grant
Home Owners’ Grant, plus, one must not
Eligibility is assessed on an individual basis—so dispose of the property before moving in.
One-off $15,000
multiple persons can access their own FHSS
contributions to purchase the same property;
Additionally for a home, one must live in
on a daily basis within a year of
If any persons have previously owned a home, it will settlement and for land, only one home
not stop any other persons being eligible to apply;
can be built, one must be certain there is
Don't sign contract to purchase or construct the
Stamp Duty Concessions not already an existing dwelling and live
home until money is released or there may be FHSS The first home concession only applies there daily within two years of settlement.
tax liability; this may take up to 25 days. to a home valued under $550,000, where
purchasers may be eligible for a stamp For further information, contact the
duty reduction on a sliding scale. If the Office of State Revenue.
13Current
regulations for
foreign investors
purchasing
residential • Must apply and gain approval from
the FIRB prior to purchasing
property in property in Australia.
• A temporary resident is a person
Brisbane • Applications are generally approved who is residing in Australia and
holds a temporary residency visa
if the property purchased adds to
the housing stock, including new which permits them to stay in
dwellings that are yet to be Australia for a continuous period of
occupied or sold, off-the-plan more than 12 months (regardless of
properties under construction or yet how long remains on the visa); or
to be built. This includes vacant has submitted an application for
land for residential development permanent residency and holds a
where ongoing construction begins bridging visa which permits them to
within 24 months. stay in Australia until that application
has been finalised.
• Non-permanent residents are
forbidden to purchase established • Are required to notify FIRB prior to
dwellings as investment properties purchasing property in Australia,
or as homes. Although there could including an established dwelling, a
be an exception if the established new dwelling that has been
dwelling is being redeveloped into purchased directly from the
multiple dwellings, and as a result, developer and has not been
there is an increase in the dwelling previously occupied for more than
count. Over the development 12 months in total and vacant land
For further information: period, the house must remain for residential development where
unoccupied. ongoing construction begins with 24
months. Temporary residents are
• Foreign buyers can purchase an off not permitted to buy established
Foreign Investment Review -the-plan dwelling, when another dwellings as investment properties.
Board [FIRB] buyer has failed to reach
settlement—reverting to its previous • May acquire one established
firb.gov.au status as a new dwelling. An dwelling only and it must be used as
apartment or house that has just their main residence (home) in
been built, or is still under Australia. Such proposals normally
construction and for which the title meet with no foreign investment
Department of Immigration has never changed hands, is not objections subject to conditions;
and Border Protection considered an established dwelling. such as, that the temporary resident
sells the property when it ceases to
border.gov.au be their main residence.
Non-Permanent Temporary Resident
Resident (Temporary
(Foreign Investor) Residency Visa)
14FOCUS ON BRISBANE Q2 2019 RESEARCH
The Australian Government welcomes foreign investment into Australia’s residential property market. The current rules around foreign
investment in residential property aim to direct investment into new housing, increasing the housing supply and support local
economic activity.
• Acquiring second-hand dwellings for
the purpose of providing housing for
their Australian-based staff normally
meet with no objections subject to
the conditions set by FIRB. • Investment migrants under this
• Investment migrants under this scheme are required to invest at
• The company must sell the property scheme are required to invest at least AUD$15 million into complying
if it is expected to remain vacant for least AUD$5 million into complying investments in Australia for a
six months or more. In remote and investments in Australia for a minimum of 12 months before
rural locations foreign companies minimum of four years before becoming eligible for permanent
may rent out dwellings acquired becoming eligible for permanent residency; a more expeditious
under this category only where they residency. pathway than the SIV.
are unable to sell the property.
• The SIV scheme is intended to • The PIV scheme is aimed at
• Whether a company is eligible, and target the migration of high net- attracting applicants with business
the number of properties it may worth individuals to Australia with and entrepreneurial skills and capital
acquire under this category, will the longer-term aim of transferring to enhance investment into
depend upon the scope of the wealth of international businesses innovative Australian businesses
foreign company's operations and and individuals to benefit Australian and the commercialisation of
assets in Australia. businesses and the broader Australian ideas, research and
economy. development.
• Foreign companies would not be
eligible under this category where • The SIV scheme was introduced on • The PIV scheme was introduced on
the property would represent a 24 November 2012 and is operated 1 July 2015 and is operated by the
significant proportion of its by the Department of Immigration Department of Immigration and
Australian assets. and Border Protection. Border Protection.
Significant Investor Visa (SIV) Premium Investor Visa (PIV)
Foreign Company Investment Migrants
with Australian (High Net Worth Individuals)
Business
15Additional Costs for Fees payable by Foreign Investors,
Foreign Buyers Residential property
Based on Property Value, AUD
All foreign persons — that is, temporary
residents and non-residents — can apply $0 - $1,000,000 $5,600
to purchase vacant residential land for
development and newly constructed $1,000,001 - $1,999,999 $11,300
dwellings in Australia.
$2,000,000 - $2,999,999 $22,700
Non-resident foreign persons are $3,000,000 - $3,999,999 $34,000
generally prohibited from purchasing
$4,000,000 - $4,999,999 $45,400
established dwellings in Australia.
However, temporary residents can apply $5,000,000 - $5,999,999 $56,700
to purchase one established dwelling to
use as their residence while they live in $6,000,000 - $6,999,999 $68,100
Australia, although on the condition the
$7,000,000 - $7,999,999 $79,500
property is sold when it ceases to be
their principal place of residence. $8,000,000 - $8,999,999 $90,900
$9,000,000 - $9,999,999 $102,300
Once a property has been identified to
purchase, an application must be made $10,000,000 or more tiered per million
to the Australian Foreign Investment
Review Board (FIRB).
It is highly recommended that an
application is submitted prior to the
advance of any transaction—to ensure
complete legality of the purchase. The FIRB provides an interactive fee
Additionally, approval from FIRB is estimator.
property-specific—one application per
property.
Duty Surcharge
When the application is submitted, the The Queensland state government
government investigates to ensure that imposes a duty surcharge for foreign
the purchase of the property will be in the investors, payable in addition to general
country’s best interest. state-based transfer duties; known as the
Additional Foreign Acquirer Duty.
A decision on the application is made
within 30 days—unless complications or Since 1 July 2018, foreign purchasers are
alterations occur, in which it may take up required to pay an additional 7% of the
to 90 days. sale price.
Other states with foreign investor duties
Foreign Investor Application include New South Wales (8%) as of 1
July 2017, Victoria (7%) as of 1 July 2016
Fee
and Western Australia (7%) as of 1
All foreign investors must pay a fee January 2019.
before their foreign investment
application will be processed.
Foreign investors are required to pay Duties payable by Foreign Investors,
$5,600 to purchase a new property if Residential property
valued under $1 million, with additional Based on Property Value, AUD, Payable in
addition to general state-based transfer duties
fees payable per million in the value of
the property. Queensland; including Brisbane
Duty Surcharge on Purchase Price;
This fee does not provide any assurance 7%
from 1 July 2018
of securing the property and strict
penalties are applied for those who
breach the rules.
16FOCUS ON BRISBANE Q2 2019 RESEARCH
Estimated Property Purchase Costs, Brisbane
All costs represented in AUD, As at 1 April 2019
Purchase Price 350,000 500,000 750,000 1,000,000 1,250,000 1,500,000
Transfer Duty 3,500 8,750 19,600 30,850 45,230 59,600
Land Transfer Fee 790 1,310 2,190 3,060 3,940 4,810
Legal Fee (includes GST payable) 1,500 1,500 1,500 2,000 2,000 2,000
Mortgage Application Fee 190 190 190 190 190 190
General: Estimated Total Costs 5,980 11,750 23,480 36,100 51,360 66,600
Foreign Investor Application Fee* 5,600 5,600 5,600 5,600 11,300 11,300
Foreign Investor Duty Surcharge @7% 24,500 35,000 52,500 70,000 87,500 105,000
Foreign Investor: Estimated Total Costs 36,080 52,350 81,580 111,700 150,160 182,900
Estimated Property Purchase Costs, Brisbane
All costs represented in AUD, As at 1 April 2019
Purchase Price 1,750,000 2,000,000 2,250,000 2,500,000 5,000,000 7,500,000
Transfer Duty 73,980 88,350 102,730 117,100 260,850 404,600
Land Transfer Fee 5,690 6,560 7,440 8,310 17,060 25,810
Legal Fee (includes GST payable) 3,000 3,000 3,000 3,000 3,000 3,000
Mortgage Application Fee 190 190 190 190 190 190
General: Estimated Total Costs 82,860 98,100 113,360 128,600 281,100 433,600
Foreign Investor Application Fee* 11,300 22,700 22,700 22,700 56,700 79,500
Foreign Investor Duty Surcharge @7% 122,500 140,000 157,500 175,000 350,000 525,000
Foreign Investor: Estimated Total Costs 216,660 260,800 293,560 326,300 687,800 1,038,100
1718
FOCUS ON BRISBANE Q2 2019 RESEARCH
WHAT IS THE
In Brisbane, costs and taxes associated
with the ownership of a property can vary
Additional Costs as ROLE OF AN
dependent on the services the building a Landlord OWNERS
provides. CORPORATION?
Property Management Fees
General Costs Letting Fees are usually equivalent to two The rights and responsibilities of
(2) weeks rent paid to the agent as a fee both the owners corporation and
Land Tax for finding and securing a tenant. its members is different in each
Land tax is an annual state tax that is Management Fees cover any costs state but generally comprise:
calculated based on the aggregated associated with managing the property
taxable value of all land owned (or jointly and range from 7% to 8.5% plus GST. • Maintain and repair the common
owned) by an individual. Land Tax is not property of the strata scheme;
applied if the property is your principal Utility and Service Charges • Manage the finances of the
residence.
The owner must pay for the use of strata scheme;
utilities (electricity, gas, oil and water
Council Rates supply). Although if the owner leases the • Maintain required insurances
including public liability and
This varies across states and local property to a tenant, some of these can
building insurance where
government areas. This is the tax the be passed on but this must be stipulated applicable;
council charges owners for the services within the tenancy agreement. However,
to the property—generally paid quarterly the owner must pay for the actual • Keep records of all details of
installation and initial connection costs. notices given under the relevant
or annually.
state strata management
legislation;
Income Tax Landlord Insurance
Landlord insurance is designed
• A strata register must be
Income tax is payable on gross rental established and maintained,
income, less any allowable deductions specifically to cover rental properties. detailing the owner’s name or
incurred in earning that income. As there Depending on the insurance provider, it agent’s name and address for
protects the home from damage, theft, each lot within the strata
are a number of potential allowable
severe weather or rent default in some scheme;
deductions, it is recommended that an
cases. To decrease risk, landlord
Australian Tax advisor is consulted.
insurance is highly recommended.
• Administration of any by-laws for
the strata scheme;
Owners Corporation • To provide a grievance register.
If the purchased property is Strata Titled Additional Costs for
(a building with common areas and
facilities for the use of all occupants of Foreign Owners
the building), an owners corporation will
be established for the building. Foreign-Owned Vacant
Residential Property Levy
A regular fee must be paid to the Owners The Australian government charges an
Corporation to maintain these common annual levy for foreign-owned vacant
areas. This can include elevators, foyers, residential property (ghost tax). The levy
swimming pools and spa, gymnasiums, is equivalent to the FIRB application fee
plants and foliage, lighting, staircases, imposed at the time the property was
fences, visitor car parks and security. purchased if they fail to occupy or lease
for at least six (6) months of the year.
A group of elected people manage the
operations and decision-making of the Absentee Land Tax
common area of the property. Surcharge
In most states, the owners corporation The Queensland state government has
comprises of an executive committee imposed a 1.5% absentee land tax
(generally individual owners of the surcharge for foreign investors. This is
apartments) who make decisions on the payable in addition to general land tax
behalf of their owners. and is based on the taxable value.
19There are costs and taxes to consider
when selling residential property in Additional Costs for
Australia.
Foreign Owners
General Costs Capital Gains Tax Clearance
Legal Fees Certificate
Foreign and temporary tax residents are
Legal fees include, but are not limited to,
no longer entitled to access the CGT
the costs for preparing a contract for
main residence exemption from 7.30PM
sale. The solicitor or conveyancer fee
(AEST) on 9 May 2017.
could be dependent on value of property,
and may vary between state and territory
Although, existing properties held prior to
as well as the particular solicitor chosen.
this date will be grandfathered until 30
The cost may range between $2,000 and
June 2019.
$4,000, plus GST.
A CGT withholding rate for foreign
Real Estate Agent Fees investors is applicable for all contracts
An agent fee is the commission paid by with a market value over $750,000 when
the owner, to the agent, for selling the signed on or after the 1st July 2017.
property—either tiered rate or a fixed
rate. Do ensure you understand the This requires 12.5% of the purchase
breakdown of the fee structure as price to be withheld by the purchaser and
commissions will vary between states, remitted to the Australian Taxation Office
and price point. Fees often range (ATO) unless a clearance certificate has
between 2% and 3% of the value of the been provided by the vendor. The money
property sold. withheld is a portion (not in addition to)
from the agreed sale price.
Marketing Costs If a purchase price negotiated between a
When an agent is selected to sell the purchaser and vendor is on an ‘arm’s
property, the fee breakdown will often length basis’, then the purchase price
DOWNSIZER stipulate the budget associated to the may be used as a proxy for market value.
INCENTIVE marketing and advertising of the
property. Additionally, there may be a The ATO can only grant a clearance
Downsizers (aged 65+ years) period allocated to marketing with certificate to a vendor who is considered
can make a non-concessional
multiple open house inspections over to be an Australian resident.
(after-tax) contribution into their
Superannuation account of up several weeks. Budgets for marketing,
to $300,000 from the sale of media, as well as length of advertising Do note a residency status for tax
their family home. should all be discussed with the agent to purposes is not necessarily the same as
ensure maximum advertising potential. that for immigration purposes; or for the
Introduced from 1 July 2018, FIRB. It is recommended to seek
the legislation states the
professional legal advice to further clarify
property sold must be the Capital Gains Tax the residency definition for this
person’s home (main residence
Capital gains tax (CGT) is a federal tax legislation.
and be eligible for the main
residence exemption for capital levied on the gain or loss upon the sale of
gains tax) and held for at least an investment property. The foreign resident CGT regime for
the past 10 years. withholding tax applies to taxable
The tax is implemented on the difference Australian property including vacant land,
This will increase their tax-free between the cost of acquiring the buildings, residential and commercial
fund limits. Couples will be able property, and the value when sold. The
to contribute up to $300,000 property, leaseholds and strata title
difference is then added to the income schemes.
each, giving a total contribution
per couple of up to $600,000. tax for the individual or company for that
financial year, and taxed accordingly with For further information, contact the
those rates. Australian Taxation Office.
20FOCUS ON BRISBANE Q2 2019 RESEARCH
In recent years, the federal and state governments have introduced foreign investor fees, tax surcharges and levies. Below is a
summary of the current process for foreign buyers when purchasing, owning and selling Australian residential property.
The Process for Foreign Buyers when Purchasing, Owning and Selling Residential Property, Brisbane
As at 1 April 2019
BUYING
Check if the Applies to all
Property-specific;
Must be made Developer has a Australian
APPLY TO FIRB one application
prior to purchase Exemption residential
per property
Certificate properties
+ PAY FIRB Above If within several
APPLICATION FEE Below = $11,300 + fees Contact ATO if categories the
based on AU$1M = $5,600 are tiered per over $10M highest fee
value million applies
Decision is Must be in the Approval or fee
AWAIT FIRB Strict penalties
normally made best interest of does not secure
APPROVAL occur if in breach
within 30 days Australia sale
Qld
TRANSFER DUTY
(incl. Brisbane &
SURCHARGE
Gold Coast)
on market value
= 7%
OWNING
AUSTRALIA > Equivalent to
not genuinely on
VACANT Applicable if application fee
Annual levy rental market for
RESIDENTIAL vacant or paid at time of
6 months of year
PROPERTY purchase
Imposed if
Absentee Owner
Qld > taxable land is
= 1.5%
$350,000 +
SELLING
A clearance Clearance
CAPITAL GAINS TAX 12.5% of the Applicable to all
certificate must certificates
(CGT) on market purchase price contracts over
be provided by granted to Aus.
value withheld $750,000
the vendor residents
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