HOUSE PRICES in flood-prone areas are floating to the top of the market, outperforming the rest of the city, but experts warn it is not without risk.
Universal Buyers Agents property expert Darren Piper said the 2011 Brisbane floods do not appear to have dampened the appetite of home buyers as prices continue to trend upwards in flood-prone areas.
According to the latest analysis by Core Logic, 19 of the 20 suburbs affected by the Brisbane floods have outperformed house sales in the rest of Brisbane.
Fig Tree Pocket saw the highest amount of growth over the past five years jumping 52.7 per cent compared to the Brisbane average of 26.7 per cent.
“After the floods, we saw a noticeable shift downwards in prices and those areas did see prices slide quite significantly in the aftermath,” Mr Piper said.
“You would think that the perception among buyers would continue to see these areas as risky or negative, but anecdotally we’ve seen the complete opposite.
“Some of these areas, particularly around the Western Suburbs are skyrocketing, seeing some of the best price growth in years.
“Before the floods, these areas were seeing record high prices, now is a great time to buy while prices are still on the rise.”
Because of the close proximity to the Brisbane River and great nature and aspects of riverside living, Mr Piper said despite the floods these areas will continue to be a hotly sought-after opportunity for buyers.
However, he does warn buyers to weigh up the risks and seek the advice of a professional before being sucked in by the promise of high return.
Mr Piper warns that although house prices may be trending higher, buyers should do their homework to find out how their insurance costs could increase, potential maintenance costs and ongoing concerns could affect their investment long term.
“If you consider the likelihood of another once in a hundred year flood happening again in our lifetime is quite low, you can see why perceptions have shifted,” he said.
“But despite the opportunity, it is not without risk.
“Given the challenges, it is worth employing a property expert to help you weigh up the positives versus the risks and make sure you’re making the best decision.
“We can help work out what the potential opportunity is.
“We know developers are eyeing up these areas and they will continue to see demand rise, but it helps to have someone in your corner.”