THE Ipswich property market is tipped to take off following the awarding of a massive defence contract to the region.
The $5 billion contract for 211 hi-tech armoured vehicles announced earlier this year, is tipped to create defence jobs for the region for about 40 years.
Analysis by RiskWise Property Research tipped that over the medium to long term the region would deliver strong returns.
CEO, Doron Peleg, said other state government commitments to spending on infrastructure and roads in the area would also help create a construction boom.
Mr Peleg said with a reasonably low median house price in the area of just $371,000 it was a more affordable option for many buyers, particularly when compared to Brisbane’s median house price of a much higher $530,000.
9 Pryde St, Woodend in Ipswich is listed for $369,000.
“The Ipswich area did deliver a slightly below average price growth relative to the Greater Brisbane and Australian benchmarks over the past five years,” Mr Peleg said.
“This is likely a result of its geographic distance from central Brisbane and the coastline, where most of the housing demand is centred.
“But that bodes well for those looking for affordability and the area has a house price-to-income ratio of 5.2 which is well below that of Brisbane and the rest of Australia.
For investors the area has a high median rental return of 5.2 per cent for houses and 5.8 per cent for units.
He said changes in the area will translate into a growth in median house prices in the medium to long term.
While there had been a lot of housing built in the area in the past few years Mr Peleg said it had been quickly absorbed.
“There are nice and very modern and comfortable, pleasant homes for a very decent price,’’ he said.
“It is really hard to compete (with the Ipswich market).’’
“It ticks all the boxes.’’
Property analyst Michael Matusik’s latest Matusik Missive said Ipswich was going through a period of intense urbanisation.
He said there were a number of things the property market in the region had going for it.
“Most of Ipswich’s housing types are in the recovery phase of the property cycle. All should peak sometime over the next twelve to 18 months,’’ he said.
He said sales volumes had more than doubled in the last five years and he tipped it to grow by another 20 per cent before the next peak.
The Missive said at present both new and resale housing supply were struggling to keep up with sales.