EP. 10 | Queensland - State of Investment | Property Market Outlook 2026

Parag Dixit

Hey guys, how are you evening?

Julius

Buddhist, Julius, good, good.

Mudit

Good to see you. Parag, studio, back in the studio. Yes, we've been eagerly waiting for this evening again, where we can discuss and talk about another another topic, another day. But is there's so many that things that we've been keep we keep discussing, and it will be good to share more on our new series that we're talking about.

Parag Dixit

Yeah, Parag, definitely. But yeah, lots, lots happening. You're right. There's, there's so many things which have moved around the world is changing every day we speak. The environments are changing every day when we speak the things which we are and that's where, you know, we thought about doing this series about in what's going to happen in each state in 2026 the state of investment series, which we want to start off, and we want to be, you know, talk in depth about each state. Obviously, we've spoken on on, broadly about what's happening in Australian market. What in depth is important, right? It is so much happening everywhere.

Julius

There is lot which is happening in every state, and it is going to be very different than what we had witnessed. Yeah, so it's important to understand how we're going to invest what I want to look at, and then what kind of data sets we need to follow. Plus, what are the strategies

Parag Dixit

the low hanging fruits are gone now it's hard yards. I think 26 will be hard yards. 27 will be hard yards as well. There is, there are so many factors which are going to come in and which are playing along, where how markets are moving, how things are moving, but yeah, it's, it's going to be interesting. And I suppose it's going to be very, very challenging for anyone who wants to come in and someone who wants to just invest, because they want to invest, those times are gone where you can that you strike lucky with whatever you do. But yes, and that's where the this series becomes important for us, which we want to start off with, the state of investment series in which we'll talk about Queensland today, and I think we'll talk in detail about Queensland. We'll talk about how, you know, we'll maybe, we'll break it down into Brisbane, and rest of Queensland, Brisbane skews the data a bit. So we'll do that. We will talk about what kind of purchase affordabilities Are there, and what's happening Rental Affordability is how they're moving along. How's the outlook for if you're wanting to buy a property in Queensland, if you're looking at renting, or if you're an investor, or it looks like, and, you know, what should we look forward to? And how does, where does it position? You know, in India, summarize it, where does it position? Where can we go? And does Queensland look like somewhere where people will be eagerly investing in this year? Yeah, or that's something which is going to be one of the options so interesting to talk and

Mudit

also, what is the different impact of different economic macroeconomic factors? How is that going to impact? Because that's a big thing. And I think it becomes more interesting because it's it's not homogeneous at all. The growth, the drivers, the impact of them is, is, is, is different across different locations. So understanding location by location, and a bit about how different areas can perform, I think that becomes more critical.

Parag Dixit

It does become more critical and and see a lot of stuff had happened in 2025 in in Brisbane. And let's, let's talk. Let's maybe start with Brisbane first. And it's Brisbane is what comes to our mind first when we talk about Queensland, but there's so much more to Queensland than Brisbane. But whenever, when we started off with Brisbane, Brisbane in 2025 i i The high I suppose the house is there. They move toward 1.13

Julius

1.13 surprisingly, units outside immediate. I know there's little gap between the House and the units, but had he's got a phenomenal growth.

Parag Dixit

The only state where I think units have done equally better

Julius

than house better than houses. Yes, that's That's Christmas. So if you look at 2025 numbers, then houses grew by around 14% versus units grew by around 16.9 to 17% depends on where we are buying but on an average, around 17% there's

Parag Dixit

a good growth of units because this, and that's phenomenal. And it's not that Queensland has grown for the first time. It's not a new state which has come up, I think, for the last five, six years compounded, it's given us about 86 87% of growth in the last five years, which is phenomenal, which is a very, very high growth. It's 17% about about 70% a year, which is not small, that's huge. And it's it's someone who's invested five years ago. I think they're, they're looking at their laughing.

Mudit

But what's happening now is, but because of such a high growth in the last five years, the affordability has taken a taken now. Affordability currently, on an average, if we talk about the number of years to own a property, is currently sitting at around 65 years, so which is pretty high compared to how it was few years ago. So people who had invested at that time, they have seen a very. Very good growth, but increasingly so, is it as interesting? Is it as lucrative? That becomes a question, which

Parag Dixit

keeps on coming again, the newer generation, the future generation, which is going to come in, it's becoming harder and harder for them, because the value of properties have gone up. Maybe you can someone can say like this, that the incomes have not grown in conjunction with the values, the way the values have grown up. But still, it is. It's an affordability gap, which is, and 65 odd years is a lot of time to really do that, and and it's it's been worsening. It's been worsening since the last two, three years post covid, it's become even worse. I mean, yeah, it was covid was not supposed to be like this. It was supposed to be a jolt to the entire system. But it did not. It turned out to be something very different. And it turned out to be something which is a very different outlook for everyone.

Mudit

You're absolutely right. In the last two, three years, what has happened is Brisbane was never number two. Last if you look at 20, 3040, years data, Brisbane was never number two. Now Melbourne, it has. It has gone far ahead of Melbourne in that sense. And that's where the surge in the last five years has come in, and it has made Brisbane closer to Sydney now, compared to, I mean, not as close still, but it was. The difference was much more earlier, and Brisbane is gone ahead of a lot

Parag Dixit

of states. Good point to touch upon. I think one of the reasons why the purchase affordability took a hit in Brisbane was, you know, when post covid, during covid, when there was such a large interstate migration, both from Victoria and NSW, into Queensland, that really impacted it. Yeah, that really took that changed a lot, and that really took people. So more people came in, more population came in. Gold Coast became better. Brisbane became even much better. The climate is good. The weather is good. People, people like to live there. You know, it's different in Melbourne, it's different in Sydney. It's a nicer place. I like

Julius

Brisbane post covid, the affordability is was around 20 years, yeah. And then stock and market was extremely lower, higher demand. It's better condition to leave. And then there is major impact because of those reason as well as the interstate migration. The major reason to do an interest rate migration is mainly because of the good housing condition, as well as houses were cheaper, good buying, affordability, plus and then why it has suddenly showed up because of the fact that the stock on the market was extremely low, yeah, very low inventory. And Brisbane didn't had the big run from last eight to 10 years. Yeah. Incomes were great. The property prices were like around 304 $100,000 in few councils. Yeah, yeah. So, and that has taken a lot of hit. So basically, if you look at in 2025 the stock levels are below much so they are like lowest point 2% stock in the market and vacancies was below 1% historical low, currently still. Entire last year, the average days on market was around 2526 days,

Parag Dixit

which is very low, less than a month, right? That's, that's pretty low. When you're talking of less than a month, then it's then it's pretty, pretty, pretty low, yeah, and auction

Julius

clearance rate was around 70 to 72% Yeah. So that's the phenomenal high, because if the auction clear, if the auction clearance rates are more than 60% that means you are getting into the tighter market. 71% means extremely higher, absolutely. And they were remained so far entire year. It's not like you have a flick. And then from next month onwards, again, you are in 60% Yeah. So it was a consistent around 60 in between 67 to 72%

Parag Dixit

Yeah, one, one in three. In every four properties are getting sold in the auction. That's pretty that's pretty strong and and compound it with a poor supply pipeline, because that supply pipeline was, anyways, was not so much in Brisbane, yes, and that that that's still like that. You know, still people are queuing up to buy properties, if it is within this Brisbane City. And it becomes tough, particularly for houses. It becomes tough for people to own them, because, you know, you can't reach it keeps on going further away from you. And that's what's taken the prices really, really up. And I think 25 also, you know, in terms of, like, what you were saying, inventory, the biggest thing was, it was the tightest thing in I think entire country, Brisbane has not been. It has been the more one of the most tight ones in terms of inventory availability, it's just not there. The new listings do come up, but it's so much well below demand. Investors want to live there, go there and invest, owner occupied for wanting to go there and invest. And you look at this, and when then you look at any other state, like in NSW or Victoria, even the units are now increasingly become inaccessible. You know, they they're touching about a million dollars, and because, sorry, houses are touching out a million dollars, and units are crossing them, are coming quite close to them, 800 something, which, yeah, this $1,000

Julius

is a median for units. Units gap is quite low. And. The biggest impact in Brisbane is basically the inventory. If I look at the data for multiple councils, the most in most of the council, the inventory still below 3% sorry, three months. Yeah. So that is the historical law, and it's not improving at all.

Parag Dixit

And that's the problem. It's if we end it's not improving is the bigger problem. And because even if people are wanting to sell, and they are making good money when they are wanting to sell, when the property market has continued to rise, and when they see that, okay, I'm going to get more next one. So unless you're really wanting to sell, you can hold on, right, and you can enjoy the wave. It still risen 17% in last year. So you're enjoying the wave. If the median housing prices are going up very well in Brisbane, I might as Hold on. And when the that's why the inventory is low. And if, when inventory is low in Brisbane, you compound it with the that there is no stock, it keeps on becoming worse. But was, was the other rest? Let's leave Brisbane. The other part of Queensland, rest of Queensland. Maybe it will take Gold Coast even into that. Yeah. So other part of Queensland, how was it? How did it perform in 25

Julius

okay, so Gold Coast was better. So good. When we look at the rest of the Queensland, the Gold Coast was Gold Coast is still in between 1.1 to 1.5 Millis depends on the suburbs within the Gold Coast inventory is extremely lower. Suburbs of Gold Coast, like when you go towards the kumera upper kumera, you can still see they might be a little land supply, but the inner city of the Gold Coast doesn't have more land. So that's that's like investors paradise, if can afford it. In Gold Coast, the yields are bit better than Brisbane, yeah. So it's good for the investors as well as the owner occupier, because there is a lot of lifestyle properties in Gold Coast where a lot of people would like to go and live there because the 220 live there to enjoy the lifestyle, other than Gold Coast. When you look at the Sunshine Coast and go further towards the towards the Bundaberg, till the canes, there is lot where the entire rest of the Queensland houses grew by around 12 to 15%

Mudit

Yeah, no, I was saying, Yeah, absolutely. If you talk about rest of Queensland, it's surprising that overall, rest of Queensland, leaving Brisbane alone, the house prices and unit prices, the median is somewhere close to 800k Yeah, both houses interest, right? And the growth of both units and houses has been close to 12 to 13% which is, which is quite a phenomenal growth. I mean, if we talk about the rest of Queensland as well, so if we compounded over five years, rest of Queensland grow grew by almost similar to Brisbane, close to 80% I mean, slightly lower. Brisbane grew in five years close to 90% this was 80% so that's been a good growth in overall Queensland. But yeah, of course, like we said, that it is not same across. It is different across. And that's what Judas you were pointing out, that certain areas grew higher and certain lower.

Julius

Yeah, correct. So like when we look at the multiple councils within the rest of the Queensland, then every council has a different performance. Overall Performance is pretty good. So if you look at the entire regional Queensland's growth in last five years, it's around 78 79%

Parag Dixit

that's not bad. That's that's not bad. And in fact, I think despite all this, what has happened in the rest of Queensland area, let's not call it regional. Maybe rest is a better word. So there's a lot of good, good areas in Queensland, but in the entire rest of Queensland area, I think the affordability is much better than Brisbane. Yeah, maybe you can take Gold Coast out of that, but most of the areas in Queensland, you will have affordability much better. Brisbane has taken a march, but it's much, much better here. I think in about 3738 years, you can have own, your own house. So that's a that's not bad, that's, that's pretty much, pretty much almost like,

Mudit

yeah, half. I mean, that means it is half of Brisbane, half of Brisbane, right? So income to asset ratio is far better in rest of Queensland compared to how it is in Brisbane. Yeah, it's risen

Parag Dixit

as well in the last few years. Last two, three years, it's gone up. But still, 37 years is pretty much closer to your home loan 30 year term or something. So you can, you can finish off within that. You know, you don't need to really stretch beyond that. But that's, but that's rest of Queensland, and that's not and, but that's not that's gone up as well in all of these period. But whether it is rest of Queensland or it is Brisbane, one factor is very similar in in in terms of demand and supply, the migration problem was same in Brisbane. There was a similar migration problem. In rest of Queensland, also, there is similar migration issue in the sense that they've they've benefited from the net migration which has come into them, and even even a bit of a migration which has gone out of Brisbane to the other towns within Queensland has also impacted the population growth there, and that's why, when, when you find that okay, if I am in Brisbane, or if I am in, say, southeast Queensland or something, the actual value of properties in the other areas are much, much better, and because I can have a much better property there. So there is a sustainable interest from people that I Okay, I want to buy a property there, because it makes sense for me. I can, you know, make it makes good sense for me. I I think I want to buy that there. I think I can afford better there, and it's making it easier for me to be to able to own the property correct. There are multiple

Julius

reasons so, because of the within net internal migration within the state, like when you look at the council significant urban area like Rockhampton or Keynes or Townsville or Bundaberg, the lot of government infrastructure projects where it creates a lot of jobs, like Townsville has a lot of defense jobs or mining jobs. Those jobs are so lucrative that a lot of people are moving from Brisbane to those areas. Second biggest issue is the construction cost is extremely high in that area. First is to deliver the houses. They at least take around one and after two years. So they don't have more amount of houses. And that's another reason why the inventory is too short there. Plus, because of all these facts, like, incomes are good, they are good, job availabilities, property prices are still affordable, affordable. The imprisonment, a lot of people are moving within the state itself.

Parag Dixit

You're correct. A lot of people are moving within the states. And there is a good, I think there is a good overall demand in Queensland, and that overall demand, which is spread pretty much uniformly across most LGAs is has been, has been a good factor for them, which is, let the demand keep on being higher than the supply in even in rest of Queensland for the entire 2025 I think that's what has been there. The supply could never reach where the demand was, and that's where the inventory is, is, is it's, it's better. It's better than Brisbane, say, even Gold Coast has a bit better than Brisbane, but risk Queensland has even much better than cold coast. And their stock market stocks is again lower here, very low again. But still, it's, it's getting so quickly absorbed by people who are investing sitting out of, say NSW, or sitting out of, say a Victoria, or sitting out of say South Australia. That that that demand and that that bit is just people are just taking them away,

Julius

this mixed demand of investors as well as the owner occupiers. So a lot of people are moving buying houses there for living, lot of investors because of the fact that good yields plus good capital growth very low supply, and then they are making more benefit out of it. So that's why there is equal demand between the investors as well as owner occupiers, absolutely witnessing in

Parag Dixit

rest of the Queensland, correct? And I think what is, that's a good point. And one of the reasons why this is this is the unit prices are always or are mostly similar and rising similar in Queensland is the same thing that, because the houses are so much in demand, and the supply is not able to catch up, and the price rises faster, then what's happening is people are going for units and saying, Okay, let me have a startup property, let me have a Down, Down townhouse, Let me have a apartment, and I think apartment will do equally well, and it is doing equally well, and people are relishing the choice they have made that all right, I bought apartment. It was a bit cheaper. I could it was a good entry level point for me. But I'm, I'm, I'm much better off by doing this, this bit in

Julius

even, even lower budget investors, like, if a budget is around 300 $400,000 the lot of options available for the units where the demand is extremely higher, your yields are very close to six to 7% Yeah, and start, a cost is negligible, which covers your insurance as well. So that's why there are a lot of investors who can't afford to get in houses over there with good cash flow. There are a lot of demand for the units as well. So unit market is pretty good in rest of the Queensland.

Parag Dixit

And yeah, and in fact, if it because Queensland has some part of Queensland has cyclone and water, a lot of rains, a lot of this, and you're looking when you're staying in apartments, you're a bit immune, so you don't have to really worry about insurance costs in those areas, or too much of that. So people are doing this. But again, how does that rental market look like in Brisbane?

Julius

Okay, so in Brisbane, basically, if you look at the vacancies below 1% extremely tight. And in 2025 the house rents grew by around 7%

Parag Dixit

Yeah, wow, yes. But House rents grew by 7%

Julius

house rent grew by 7% rental turnover is extremely higher, but at the same time, the prices move significantly

Unknown Speaker

higher as well come down correct.

Julius

So yield have gone down. Current average yield is around 3.2 to 3.5% in houses. In houses, all right, similarly, when you look at the units, units, rents have gone up by around 6.6% and yield is little bit better in units, because unit prices and the houses pricing has around 200 to $300,000 gap, yeah, but rentals are equal, so basically unit yields are around 4.1%

Parag Dixit

okay, okay, so in terms of yields, obviously the prices will keep on. Going up, yields have to take a hit, correct, though, you're right. So even though rent has gone up, but see, I think what has also made it a bit unique is that the migration which has come in has not only come towards the purchase side, it has also come towards rental demand side. So rental demand has been, has been really contributing for everything in Queensland. So that's that's been pretty good. And I think Olympics, and, yeah, because of

Mudit

because I think that's the big thing, which is driving a lot of growth there. Because of the Olympics, there's a large workforce which has migrated there, which is putting a lot of pressure on the rental demand. There people who have moved there for as a workforce for the time being, till the time of infrastructure construction continues being built up. Now these people, a lot of these, do not want to own a property there. They moved there for some time, not just few months, but a longer period of time. But that has put a lot of rental pressure, and that is why the rentals have moved up and but, but having said that, like we prices have gone up at a faster place pace. So the rental yields are still in the range of three to 4% not, not as bad as what we see in Sydney or some other places, but overall yield is kind of moderate.

Parag Dixit

Yeah. Again, I think even education sector has contributed there. I think there have been a few three universities, large universities, which have also started subset up in Brisbane, and that's got a lot of students as well, and obviously ancillary jobs and people who are around it in terms of the infrastructure, in terms of the economics that's coming through as well, and that's been a good contribution to that. That's obviously relieved pressure from Melbourne and Sydney, but it has also come to the benefit of Brisbane City in particular. That's what speed that's good, and that's that's always helped the demand keep on moving up and become a bit better in terms of how that that's that's come to but how did inventory move? Did in rental inventory also become tight?

Julius

And yeah, so rental tunnel was extremely faster. That's why, when you look at the vacancies, are below 1% Yeah. And then amount of houses which are coming as a new supply. It's not that high. So new housing supply is pretty low. Whatever you have, you have to consume it some there are few areas where the housing quality is not better, and then they are not coming into as the rental properties. Also, when you look at the apartment supply, it's still moderate. There are not lot of projects which are either under construction or they are not finished yet, because of these lot of covid pipeline, which is been skewed. Other thing is, in Brisbane, construction timeframe is higher, even though you are getting in new houses, delivery of these houses in between one and after two years, okay, because of shortage of the trades. Yeah. So that's the reason why. When you look at the rental side of thing. Yes, there is enough rental demand of multiple things like interstate migration. They have got a good population growth. They need lot of houses because lot of expats are coming there. But yes, since they are not more houses coming up, rentals are very, very,

Parag Dixit

very low. And whenever the house comes up, it gets absorbed like that, right? Immediately and that keeps on adding pressure on on, not only on people who are just looking out, but even on the future guys as well who want to come in, because there's already, already a rental rise, which has happened, and there's already a scarcity, there's already a pipeline. And you know, the absorption is so quick that, you know, rental listings look, look like they are pretty much lower than what a historical average should have been, right?

Julius

Yeah, all the time. And then when you look at the amount of time which to absorb those rental properties, is less than six to seven days. The moment you put the property in the market, you have around 40 applications. Then you can have an option to choose

Parag Dixit

the application. That's why it's become one of the tightest, I think, rental market in the country right now, right? It's been so tight that it's people are finding it tough to be able it's good for an investor. So if you look at as an investor, view, Brisbane looks very nice. I can lease it off tomorrow, right? I think

Mudit

absolutely so. What is good for someone? It's a zero sum game, right? So what is good for someone may not be good for somebody else. So if you're an investor, this looks very interesting, but if you are the one who's actually trying to go there and get something on rent, it's a nightmare, right? There are two opposite sides of the coin that what do I do when I'm looking to move there on rent? Because their supply is very short, everything is going out. So people, there are stories about people that they've been trying to find a place to live in, and it has been a little not so easy, but as an investor, yes, absolutely. Why not? And that's

Parag Dixit

that's right. And like Julius was saying, and you compounded this with a six, 7% annual rental growth, whether it's a house, whether it's a unit, it becomes a problem. And obviously this is, this is a race against time for someone who wants to lease. It a good problem to have for an investor that he can choose what it is. But these, these, these factors, which we just spoke about in terms of the rental demand, which are catering to rental demand and are pushing the rental demand across the Brisbane. It's, it's, it's got the. Inventory pretty, pretty much in the way it is, right? Yeah. And how does it work in rest of Queensland?

Julius

How does it perform the rest of Queensland? It's a similar condition. It's even worse in few places. So similarly, like, when we go to Gold Coast, is similar to Brisbane, like they don't have vacancies at all. The rentals are much better in in Gold Coast, because there are a lot of people who can afford the higher rentals because of the lifestyle properties to go towards the towards the Makai, towards the Gladstone, there is lot of rental demand because of big gas projects, basically. So that's why the rental vacancies are below 1% similar things in the Townsville as well. In Townsville, what we could see is they are section of Townsville where they have good quality properties versus their bad quality properties. So there is not availability of the good quality properties as well, and for such properties there is highest demand. So when you look at the overall perspective of the towards the regional Queensland, the rental begins is so tight, and rentals are increasing so fast,

Mudit

so I think the rental yields are somewhere in the range of four to 4.5% across houses and units. So that is higher in Brisbane, higher than Brisbane. But what's happening is, what's happened is that you're getting similar kind of rents, which are in Brisbane, in rest of Queensland as well. So the property values are a little lower, lower, but the rentals are almost similar because of the tight supply, yeah, and because of the higher demand, because of which the rental yield is a little better.

Parag Dixit

So I love it as an investor,

Mudit

as an investor, yes, as an investor, absolutely, absolutely right. So that has contributed to overall influx of investors in the in the rest of the coins, and absolutely

Parag Dixit

right, and and see when, when, as a landlord, I'm a, I'm a landlord in a regional, Queensland area, I am getting a great trend, and I'm having a lower purchase price. Why will I not go there? I get great yields. I'm getting good, good tenants. I'm getting I'm I'm getting everything what I wanted. Hence, it's the market for me to be in right, and I market for me to invest in it. So restaurant rental demand, that's why these lifestyle and these affordability demands are getting tenants in there, and because tenants are coming in there, and because people are wanting a good lifestyle, people are wanting good enmities around them. So investor is wanting to come there as well that okay, i My house is going to be secure. I'm going to get a good rent out there. I'm going to have a good investment property. More likely it will have a great capital growth. It will have an impact on capital growth, and that underlying demand will keep on, keep on becoming better. But one good thing, I think we should also, we should also applaud the effort which the government has done that they have spread across in, you know, all infrastructure and everything across pretty well everywhere, which is why it is you can see that the population distribution is also becoming a bit uniform across the whole stretch in A lot of areas, and most of those areas, from starting from a Gold Coast to a Brisbane to Mackay to Rockhampton to Keynes and to all of this, it's they all are enjoying similar benefits to the extent

Mudit

they can. Yeah, absolutely right. I think that is something you're absolutely right, that we should applaud the government on this. Because if you look globally, a lot of migration everywhere is towards the urban centers. Only Correct. You look at any country you talk about, people are moving from the countryside to the urban centers, and the urban centers, the big ones, are becoming more tighter and tighter. But here, because of because of infrastructure development, more job creation, the demand has is going the decentralization of population from Brisbane to across different centers is happening. Which is, which is how it should be. You should not be forced to move to one location only, and everybody's moving there, which creates so much pressure on the existing infrastructure, everything, whether it's housing, whether it's electricity, whether it's movement, whether it's road infrastructure, whatever you say. So it becomes a problem. So that ways, the more growth happens across different places. It is generally good for the overall state and revenue, and how to run the state better, and how for investors, for people who are looking, looking to live there. But the problem has been, of course, housing supply has been the bottleneck, which is, which is not able to create, cater to that kind of demand which

Julius

is going there same, same issue in in in regional Queensland, like Brisbane, but it's in worse. So when you go, when you pass Gympie and go towards the towards the northern side till the till till the canes, land is little bit cheaper, but the construction pipeline is like worst in Townsville or Rockhampton or Bundaberg or towards the Keynes. If you want to build a house, the PERS per meter construction cost is very close to $3,000 okay, yeah, so the cost of construction is expensive when you build the houses, the timeline is around two to two and a half years. And then when you look at the type of projects they have, like Townsville has the biggest defense projects. So you can you can see f 35 parked. On Townsville airport, and you can see the sorties, plus, they are adding more defense personnels. They need lot of houses. There is lot of DHA demand, lot of mining activities, big headquarters of the big companies. Same thing in Rockhampton. You can see it as a similar thing in Keynes. So in when you say is decentralized, that's right, because Brisbane, sorry, Queensland, has a larger number of significant urban areas in terms of the EB. Some significant urban areas are like where you have all the infrastructure, you are exactly in between regional town center and capital city, where your population is more than 100, 150,000 people, but you still have all the facilities, all the jobs and diversified employment, yeah. So when you go towards all the significant urban areas, population growth trend is extremely higher. And because of this high paying jobs, like even in Townsville, they have a biggest Medical University of that entire region. Like you can see, a lot of expats from UK and other part of the world are coming there. So there are lot of renting demand from the doctors and the nurses. And it's as big as the West Hospital in Sydney. I've seen that. So what I want to say is there is enough demand economically, where the people are moving, there is enough money which they are earning to can spend towards rentals. But only the biggest issue is the houses. Housing supply is pretty low.

Parag Dixit

Housing supply is pretty low, and that's why people will like to buy and just hold on to a property rather than try and jump for a home in land or a new construction or a new build or something there, because you don't really want to, want to get into that too much. But okay, I think we've spoken a lot about this, and we should really, we should really understand what is the economic out or Outlook. You know, that's important, because if we have to look at what's going to happen in 2026 it's important to see whether the entire Queensland is entire Queensland and is going to have a good movement in terms of, say, an inflation, and some say interest

Unknown Speaker

rates and taxations

Parag Dixit

and all that. So let's, let's say, Okay, let's speak one by one. Let's, let's get into see, you know, inflation. So Queensland as a state, does it differ greatly with respect to the inflation and with respect to the impact of inflation, and what's contributing to inflation, versus in Australia?

Mudit

So inflation, I think, touched right upon the subject, which is at the center of the economic discussion right now, inflation has been high in the last few months, and which has been resulting in impact across the country. But if we talk about Queensland, it is the CPI there has been higher than the average. CPI has been higher than the country's country's average is 3.8% there it is 4.1% so it is higher inflation. And housing has contributed. Of course, like everywhere else, housing is the biggest contributor is it has gone up by Six 7% nationally, electricity, recreation, drains. These are the contribute. These are main factors which are contributing to inflation in the in Queensland as a

Parag Dixit

state itself, absolutely right. In fact, it's projected that, you know, brisbane's 2026 CPI would not fall below 4% so it may be 2620 mean, 27 it starts coming down, but obviously you never know what's going to happen on the rate of interest stuff. But the inflation is not going to come down, and it's going to be there for a bit longer. One of the biggest drivers for insurance for inflation in Queensland has been the electricity rebates, which are now getting expired, and those expiring electricity rebates have driven up the electricity cost to and that's been a large contributor. More than 32% of contribution had come in through the rebates which were expiring. And that's been a prime driver for this rents has been a prime driver for for the inflation to be moving up, and that's not going to go away. No, this, the these, the sticky data of rental vacancy and lower construction pipeline and all of these bits don't really look like even in 27 something is going to improve in Queensland. It's still a bit of it's going to still remain

Mudit

tighter Absolutely. And the problem is that inflation, of course, it impacts a lot people who are at a very high income level. It doesn't impact them that level, that that much. But of course, people who are on relatively lower and modest incomes, it impacts them pretty bad. But the problem is that inflation has a direct impact on interest rates. Then right so the moment, and we know that RBA has been has increased the interest rates recently, and that's the impact of interest biggest contributor there was inflation data, right? So, and it is expected that in the next few weeks, and more, in the next three months, there could be one or two again, rises in the interest rates. So that's gonna impact, definitely, the demand for whether you are looking as an investor or if somebody to live in it's going to impact, impact the demand in the in the state of Queensland, and the fixed rates, for example, the variable rates. Anyways, the last increase resulted in, most banks have passed on the. 25 basis points interest rates to everybody, fixed rates have gone up. Fixed rates one year and two year, both fixed rates have gone closer to 6% that also shows that the economics, the economists are not expecting the interest rates to come down anytime sooner. So both inflation increase and the corresponding interest rate increase is not that great. From a, from a, from an borrowing and investor point

Parag Dixit

of view, but yeah, again, see, you can't really fault just the RBA for that, because the geopolitical environment today is so bad. Something new comes up every second month or something, and it's a it's a nightmare trying to catch up with what's happening. Lots keeps keeps on changing. And when it keeps on changing, we will, we will have that. And the we, when you are seeing that, okay, there is, there is too much movement in the economic market. There is, there is no inflation is bound to go up. You know, it's, it's, you're caught between, between two, two sides of the road. You know, what do you do if you, if you don't really increase the interest rates. Inflation goes up. If you increase the interest rate, it becomes worse for people to live in but again, I would say, if I were to look at an impact like this, if I look were to have a very contrarian view on this, okay, now if, if there is a higher interest rates, then if I were to look at an investment, I think that is going to put a bit of a pressure on benefit to me to invest into a state where I'm going to get impacted by inflation or interest rate with whichever part of the country I live in, but might as well invest into a state which is going to give me higher yields. So if I'm going to have a higher yield scenario, and if I'm going to protect or mitigate myself from from this, and I still want to invest obviously, then I'm looking at coincidence favorably, because I'm saying, Okay, I'm going to get hit by inflation and higher interest rates anyways on this. But on the flip side, for people who are going to live in to in or maybe are tenants or owners or something there for them, it's different for them, higher inflation interest when versus other states, I think, I think WA is the only one which is a bit higher, but the higher inflation means higher cost of living plus higher interest rates. So owner occupiers or tenants may feel a pressure because your rents are going up, your your interest rates and Dixit, your repayments are going up. Your cost of living is higher than rest of the country. And obviously your incomes are there where they are. So that's going to be a bit of a squeeze here. But for an investor, when you're looking at it, and they look at it very contrarian view, they can always say, Okay, I'm going to get hit by inflation and interest rates anyway. So might as well, you know, let me, let me look at coincident favorably. Why should I not look at coincidence favorably? It looks like, okay, I can, I can make money here, or I can be better off investing there, versus some other state where I may not be better off.

Mudit

Absolutely right? You know, you're right on that front, especially like you're saying that the supply shortage continues and the impact of inflation and interest rate putting pressure, but, but the supply putting pressure on that is going to be favorable for investors, correct?

Parag Dixit

And I think one good favorable part for investors in Queensland is, is the land tax. Bit land tax, like we've been talking, and we specifically have been talking, it's going to be a driver of expense for the coming years, because Land tax is now a creeping tax, which is coming on to every investor in most of the states. But here, at least if you're looking at an individual basis, you know 600,000 is not a bad threshold to have which and which is pretty decent in terms of what Queensland has. So that ways, as an investor, if I'm buying in a trust or an SMSF, I'm still have about 350k or something threshold so that that doesn't push me away. You know, I don't feel that the government is taxing me because I am supposedly rich. The investors are the rich class or something. But I'm thinking, you think the I'm more favorably, favorable as an investor, for me to invest into Queensland, because I feel that okay, the land tax bit is taken care of, so I have about one or two properties. And especially, especially if I'm looking at the other part of Queensland, which is besides Brisbane, and maybe besides Gold Coast as well, my land price is not going to be too high. So I most likely am going to have, if I have one or two properties out there in Queensland, I may avoid land tax altogether in such a case, right?

Julius

Yeah, that's right. And second thing in basically, towards the Queensland, your cost to attain the property is not that higher than the other states, because land tax threshold is higher. Property prices are growing. But what I've seen is the land prices are not growing as much as the property prices are growing. So in lot of cases, you don't incur with the land tax as well. Over there, the construction cost is higher in most of the regional Queensland part, all right, so when you split your property price, your improvement value is much higher than the land value. So. All right, so you still have a threshold up to 600,000 which is marginally higher than the other state. All right,

Parag Dixit

now that's a good that's a good description, because your land value is not growing so much, so your thresholds are not easily met. In Question, construction costs are higher, yes, which, anyways, don't count towards the tax value, land tax value. So it's a pretty favorable thing where, as an investor, if I'm looking at that, okay, this is something which I can reasonably think that I will not be, you know, dumped with the land tax bit is not going to impact me so much in doing that, but again, again. So if to look at it the way, if, if, and if, okay, capital gains tax get impacted at some point of time in 26 that, again, is going to be cushioned by my rental yields, which are much better off in Queensland. And we've been speaking in since last few years, the rental needs have been the one of the best in the country. So if that's there, and if I'm going to take care of my holding costs, because that's if, if anything happens to capital gains and my holding cost increases, then I'm again, the same way better off investing into a state where my rent yields are higher, so that my net yields, whenever it comes down to the net, net, is taken care of. I'm not so impacted by that net, net bid. But again, you know, if I were to look at the costs, and if you were to just tell me about the cost, are the costs much better in Queensland versus other states or similar, similar? It depends on