Brisbane's gentrification: Where to invest in Brisbane for solid long term growth

According to property analysts at BIS Oxford Economics, over the next three years Brisbane could experience a 20% rise in house values, while apartment prices are predicted to grow by 14%. Forecasters are confident that the median house price could increase from $552,000 to $665,000 in this time. 

With the potential for a housing boom in Queensland's capital, it comes as no surprise that investor activity is on the up and savvy buyers are searching for the best investment suburbs in Brisbane.

If you're ready to jump on the bandwagon and are looking for the best suburbs to buy in Brisbane, a good place to start is with areas that are showing signs of gentrification. 

Let's explore what the signs of gentrification are and where the best growth suburbs in Brisbane are for a strong ROI over the next three to five years. 

What are signs of gentrification?

best growth suburbs Brisbane
Close to the heart of Brisbane, inner ring suburbs are going through gentrification

Gentrification is when the wealth in a suburb starts to change, along with the demographics of its occupants. Usually, this means the area becomes more liveable to the middle class and unaffordable for the existing lower income residents. 

Typically, the new demographic consists of more childless couples. Here are a few indicators that an area is experiencing growth and gentrifying:

  • Property values are dramatically on the rise, as are rents
  • Cosmetic upgrades are taking place, like road works and dwelling renovations
  • Development and infrastructure plans
  • An increase in cafes, restaurants, bars and galleries

Gentrification occurs when there is a higher demand for inner and middle-ring suburban living, where there is good infrastructure for public transport and access to preferred schools, universities, shops, hospitals and sports and leisure facilities.

Best investment suburbs in Brisbane in 2019

Based on the criteria above, the following list highlights the potential highest growth suburbs in Brisbane for investment. The most affordable Brisbane growth suburbs tend to be in the middle-ring. Although property values may not be showing dramatic rises yet, this is forecasted to change after the market bottoms out.

4059
While not exactly in the affordable bracket with a median sale price of $849,000 for houses and $486,000 for units, Red Hill is an inner-city suburb that experts from Select Residential Property (SRP) Research Group predict will see annual house price growth of 25% by 2022.
With its elevated position, leafy streets and cosmopolitan cafes and boutiques, Red Hill offers many appealing lifestyle factors and is in close proximity to Paddington, Caxton Street and the Suncorp Stadium. It's also just three kilometres from the CBD and is well connected with public transport.
Close to two hospitals and the QUT Kelvin Grove Campus, you'll find traditional Queenslander and post-war timber homes slowly but surely being renovated with modern aspects. There's a lot of value to be found in Red Hill.
Annual growth is a little backward at the moment at -3.58%, but rental yields are moderate at 3.6% for houses and 3.9% for units, while rent average $600 and $360 per week respectively.
  • Median house price: $849,000
  • Median unit price: $486,000
  • Average house rent: $590/week
  • Average unit rent: $360/week

"With its elevated position, leafy streets and cosmopolitan cafes and boutiques, Red Hill offers many appealing lifestyle factors"

4030
Just five kilometres north of the CBD, Lutwyche has seen massive growth over the past five years due to large developments and infrastructure projects.
With more apartment builds on the horizon, a $60 million refurbishment of the Lutwyche City Shopping Centre, its own bus interchange, as well as close proximity to two hospitals, QUT Kelvin Grove Campus, and good public and private schools, it's no wonder Lutwyche has seen house price growth of 15.84% over the past 12 months.
The median sale price is $863,000 for houses and $435,000 for units, while rental yields are 3% and 4.6% respectively.
  • Median house price: $863,000
  • Median unit price: $435,000
  • Average house rent: $490/week
  • Average unit rent: $385/week

Read: Best regions in Queensland for property investment in 2019

best place to invest Brisbane
One of the many proposed apartment builds in Lutwyche | Source: The Atrium Lutwyche
4032
The surrounding suburbs of the commercial hub of Chermside are increasingly becoming gentrified, gaining in popularity with young professionals seeking investment where there is still affordability.
Close to hospitals, the large Westfield shopping complex, and the sought-after Craigslea State School catchment, Chermside West has many appealing attributes. It's seen a rise in price growth of over 30% over the last five years and that is set to continue.
In terms of property prices, the median of $585,000 is accessible. Annual growth is slow at -0.85% currently, but that should change over the next few years with some serious growth potential according to SRP. Rental yields are solid at 4% and the average weekly rent is $450.
  • Median house price: $585,000
  • Median unit price: no data
  • Average house rent: $450/week
  • Average unit rent: no data

"Surrounding the commercial hub of Chermside, Chermside West is gaining in popularity with young professionals seeking investment where there is still affordability"

4054
The train station suburb of Keperra is on the rise, thanks largely to its excellent public transport. Located nine kilometres from the city and just a 20-minute train journey away, SRP forecasters have predicted a $130,000 property value increase over the next three years. The median house price currently sits at $549,000, while units are $455,000. Annual growth for the past 12 months is 4.78%.
This middle-ring suburb offers affordability, decent sized blocks of land and good rental yields of 4.2% for houses and 4.8% for units. There is an approved application for a $313 million development of the old Keperra Quarry that will see a new housing estate built with a mix of houses, townhouses and units, as well as boasting a retail and dining complex, and an active sports and recreation area with walking trails.
  • Median house price: $549,000
  • Median unit price: $455,000
  • Average house rent: $440/week
  • Average unit rent: $420/week

Read: Best areas to invest on the Gold Coast in 2019

4170
This Brisbane growth suburb is gaining a good reputation with access to great schools and convenient public transport options. The median house price is $745,000, while units are $417,000. It's proximity to the Gateway Motorway and Brisbane Airport, along with plenty of cafes and green spaces to enjoy, gives it a lot of appeal with buyers.
With a new public golf course under construction in 2020, along with the Minnippi residential development including conservation areas, Cannon Hill has lots of investment potential. There is also an upgrade scheduled for the Cannon Hill station.
Annual growth is reflective of Brisbane's wider property market at the moment at -0.40% for houses and -3.02% for units, but if forecasters predictions are anything to go by, this should shoot up over the next five years. Rental yields are strong for apartments at 5.20%.
  • Median house price: $745,000
  • Median unit price: $417,000
  • Average house rent: $500/week
  • Average unit rent: $420/week

"Cannon Hill is gaining a good reputation with access to great schools and convenient public transport options."

4122
Located in the middle-ring, 10 kilometres from the city, a large drawcard for Mount Gravatt is its location near education hubs like the Griffith University campuses and the sought-after Mount Gravatt State High School. It's also a stone's throw away from the Carindale and Garden City Westfield shopping complex.
Even though the median house price is on the rise in Mount Gravatt, it's still relatively affordable compared to surrounding suburbs. The median house price is $649,000, while units are $404,000. Rental yields for units are strong at 5.4%, while houses offer 3.5%. Annual growth has slowed at the moment to -0.23%, but there is room for lots of growth, and SRP predict a 24% rise in prices over the next three years.
Supporting this growth are a number of development projects proposed to improve the suburb, including the new Brisbane Metro System, which will see two stops upgraded - Upper Mount Gravatt and Griffith University. There is also a redevelopment proposed for the Central Fair shopping centre, and the recent Logan Road restaurant and cafe upgrade has boosted the lifestyle factor.
  • Median house price: $649,000
  • Median unit price: $404,000
  • Average house rent: $440/week
  • Average unit rent: $420/week

Read: 5 best areas to invest on the Sunshine Coast

Other suburbs to investigate for growth opportunities:

Brisbane growth suburbs
Keep an eye out of dwelling renovations when looking for growth suburbs, as they're a sign of gentrification | Source: realestate.com.au

If you're looking to take advantage of the forecasted Brisbane property boom, keep in mind growth may seem stagnant as the market bottoms out for the remainder of 2019.

However, it is a good time to get into the market, while there is still affordability and low interest rates. Looking to invest in gentrifying middle-ring suburbs will help you find the best place to invest in Brisbane.

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