It’s getting a little chilly.
And we’re not just talking about the weather. For the third straight month, Sydney home prices have fallen and home lending eased, signalling that our once piping hot property market is beginning to cool. It’s a similar story across Australia, except for one capital city to our north that appears to have missed the memo completely.
Brisbane is now the fastest-growing capital city property market in Australia, after house and unit medians skyrocketed 32.1% and 9.3% respectively in just one year. What’s their secret? Is it something in the brown river water? If history is anything to go by—and despite politicians’ best efforts to have us believe otherwise, it always is—the answer might have something to do with the Olympics.
As we all know, Brisbane is set to host the 2032 Olympic Games. Thirty-two years after we did it, but who’s counting? (Zip it, Melbourne). According to Corelogic, Sydney property values jumped 60% between the Olympic announcement in 1993 and the actual Games in 2000. While some of this growth can be attributed to general market influences, house prices in Homebush rose 70% in the five-year lead up to the games compared with 39% growth Australia-wide.
Why? In a word: Infrastructure. In a few more: Host cities undergo dramatic facelifts as infrastructure timelines are expedited for better facilities to be built and efficient public transport systems to be implemented. Not only does this create more jobs, it also guarantees residents a better quality of life once the games end. In Brisbane’s case, its 30-year plan is likely to be expedited, delivering crucial amenities in time for the opening ceremony.
When Barcelona hosted the Olympics in 1992, it’s estimated the Spanish city built 50 years-worth of infrastructure in the 8 years preceding the Olympics. In the five years prior to the Games, property prices increased a whopping 130% thanks to a complete regeneration of the city’s waterfront along with the arrival of the high-speed AVE train.
In London, property prices increased roughly 26% in the five years after they were named the 2012 hosts. Investment flooded into areas that were previously undesirable, like Forest Gate and Leytonstone in East London, while in the already trendy suburb of Shoreditch, property prices ballooned by over 50%.
Passing the Olympic torch to Brisbane will be Los Angeles, who are set to host the games for a second time in 2028. Their first run in 1984 is widely hailed as among the most economically successful games in history, running a $232.5 million surplus and adding $1.1 billion to the Los Angeles economy. A big reason for this was the city’s decision to invest in existing infrastructure/facilities rather than build new ones.
LA plans to follow suit in 2028, hosting events at sites that already see large-scale concerts and sporting events, like SoFi Stadium in Inglewood, home to this years’ Super Bowl. Since construction began on the football stadium in 2016, through to the beginning of 2022, median house prices in Inglewood have surged a stunning 88% from $382,395 to $719,680.
As for Brisbane’s economic gain, Westpac predicts its hosting of the 2032 Olympics could inject $8 billion worth of economic and social benefits into Queensland and $17 billion across Australia. Not bad for two-weeks-worth of sports.
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