Sunshine State beautiful one day, perfect the next

QUEENSLAND has overtaken Melbourne as a target for many offshore real estate investors amid rising uncertainty across the sector, a property expert said.

Speaking at the Property Council of Australia’s Property Congress in Brisbane, Charter Hall chief executive David Harrison backed Queensland as an increasingly popular home for global capital.

“If you’re talking about offshore money, we’ve seen a lot of Japanese capital come into Australia,” Harrison said on Wednesday

“They want to go to Sydney first. It used to be Sydney, then Melbourne, then Brisbane. Now I think it’s Sydney, Brisbane.”

The shift was part of long-term improvement in Queensland’s reputation as an investor target, compared to other Australian states, he said.

“All of the outbound migration from Victoria is going to Queensland,” he said.

“Same with NSW. We’re losing people to Queensland. So I think Queensland is seen as an attractive place.”

According to Harrison, who took part in a round table with QIC real estate managing director Deb Coakley and Development Victoria chief executive Anne Jolic, it was an uncertain time for Australia’s property market.

The reason, Harrison said, was the likelihood of “a weak period” ahead for the nation’s economy due largely to higher interest rates and ongoing cost of living pressures.

Another driver was a lack of “austere changes in fiscal policy” both at the state and at federal level.

“I think how that translates into impacts on the property sector is going to be very interesting,” he said.

Australia’s property market is showing little signs of a spring recovery.

It has been hit by the RBA hiking interest rates by 25 basis points in September and the central bank has left the door open to more increases as it works to combat stubbornly high inflation.

The RBA has flagged that the inflation outlook could worsen with factors like the US-Iran war, domestic capacity pressures and how cost increases flow through to prices.

Harrison said the “silver lining” would be if unemployment continued to rise, leading the RBA to change its approach and cut rates.

Australia’s seasonally adjusted unemployment rate sits at 4.7 per cent as of September 2026, marking a five-year high.

“If I’m right, and we do have quite a weak economy and unemployment lows through five and potentially five and a half percent, we will see the central bank drop rates,” he said.

Melbourne, by contrast, continued to struggle compared to many other capitals, Jolic said.

“I think you know there was a bit of mood that we could be at the bottom potentially for the residential market in Melbourne,” pointing to the build- to-sell segment as “incredibly hard” to be in at present.

“We see that in the transactions that we’re doing with the private sector every day,” she said.

“It’s about us trying to find ways to stimulate investment and so the more we can sort of structure deals or de-risk sites, the more capacity we have to get private sector investment.”