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Which state is the best to invest in? Not only now, but in the longer term too. Strong price growth doesn't always mean a strong area to invest in and build a solid portfolio. This four-part series is time we unpack everything a serious property investor needs to know about. Victoria, Queensland, South Australia, and Western Australia.
I'm talking population, economic strength, affordability, and my analytical take on each state you won't find anywhere else. And best of all, I'm going to score each state on our InvestorKit leaderboard using three key metrics so you can see the highest and the lowest performers. In this episode, I'm going to talk about Queensland. I'm Junge Ma. Let's get into it.
So let's talk about population in Queensland. Queensland's population increased by 2. 6% over the last year, the third highest among all states. And again, as in many other states, it is also higher than its last five-year average. Then what's going to happen in the coming years?
According to the federal budget paper published this year, in the four years from 2024 to 2028, the total population growth in Queensland is supposed to be 5. 9%. It is the third highest place among all states, right after Victoria and Canberra. Different from many other states where overseas migration has contributed the most to their population growth, Queensland actually has a fair bit of its population growth contributed by internal migration. Among all our states, Queensland is the state receiving the most internal migration.
Last year, Queensland saw more than 31,000 net internal migration, moving from other states to Queensland. Because of its combination of relative affordability, nice lifestyle, and plenty of job opportunities. Now, economy. Again, we're talking about GSP growth and unemployment rates. In the past year, the GSP growth in Queensland was 2.
4%. It is lower than the 2022 level, but it's still in line with its last 10-year average. However, we need to know that Queensland's economic growth in the 2000s was much higher than its current level. And now, unemployment rate. Currently, Queensland's average unemployment rate is 3.
8%. It is just slightly higher than last year's lowest level of 3. 6%, but it is much lower than the last 10-year average of 5. 7%. So overall, the economy is improving in Queensland.
To summarize population and economic performance, we have a strong population growth, not only now, but also in the future, and an average economic performance level, but improving. So overall, we would give population and economy a score of 4 out of 5 in Queensland. Now, affordability. Again, we are talking about Brisbane versus the rest of Queensland. In Brisbane, the median house price is now $820,000.
Based on InvestorKit's relative affordability calculation, it is 23% overvalued. And this number is very close to Melbourne's 25%. If you want to learn more about Melbourne and Victoria, just check our last episode. We have a link in the show notes. Now, the rest of Queensland.
The median house price here is $620,000. There are 43 SA3 levels in regional Queensland area, and now there's only 17 of them still relatively affordable or undervalued. Southeast Queensland and some cities in Central and North Queensland are already overvalued. For example, Gold Coast, Sunshine Coast, Harvey Bay, Bundaberg, and Toowoomba. But the rest, most of the cities in Central and North Queensland are still well affordable.
For example, Rockhampton, Gladstone, Mackay, and Townsville. Now, market condition. And again, we start from supply and demand relationship. If we look at inventory, Brisbane has an inventory of 2. 6 months of stock, below the 3 to 4 months balanced level.
And in the regions, 22 out of 43 SA3 regions are seeing their inventory lower than 3. To give you some examples, Bundaberg has an inventory of 2. 7 months. Toowoomba inventory is 1. 6.
Townsville inventory is 1. 3. And Rockhampton 1. 6 as well. Only by looking at the inventories, they are already very low.
What makes it better is that the inventories are almost all declining. The major contributor of the declining inventory is the decline in number of listings. In the past year, the total number of listings in Queensland has decreased by 21%. While the number of sales hasn't declined that much. Now let's talk about days on market.
How many days houses are spending on the market before they get sold. In Brisbane, the number is 45 days. Not the lowest, but still a relatively low level. And it has been declining since late 2023. In the regions as well, most of the cities are seeing their house sale days on market declining since last year or even longer before.
In terms of market cycle position, Brisbane's last 10-year growth was annualized at 6. 2%. Just slightly higher than the long-term average of 5-6%. That gives it plenty of space for the growth if the market pressure is high. And that is what we're seeing at this moment.
In the regions, different cities are seeing different conditions. For example, Gold Coast and Sunshine Coast have grown so much over the past 3-5 years, giving them an annualized 8. 9% growth over the past 10 years. That huge amount of growth has made affordability in these two cities really poor and will perhaps affect their further growth space. In other Southeast Queensland cities and some of the Central Queensland cities like Bundaberg, Harvey Bay, Toowoomba, their last 10-year growth was very well in line with Brisbane, given high market pressure, there's still plenty of space for them to gain further growth.
As of North Queensland, the cities like Townsville, Mackay, Glaston, or even Rockhampton, they are still in a very early stage of their growth cycle, annualizing lower than 5% growth over the past 10 years. So for them, the likelihood is higher that they will be staying at this hotspot stage for longer term. So will Queensland face a large number of new houses in the coming few years? Well, the answer is currently no, because the building approval rate in Queensland on average is 1. 8%.
That is well below the 2-3% of balance level in terms of incoming supply. So to summarize sales market pressure, we are seeing high pressure in most of the regions from Brisbane to some Southeast Queensland cities like Toowoomba, all the way to North Queensland. The only two cities just seeing relatively balanced market pressure, Gold Coast and Sunshine Coast. And because of that, we would give Queensland a 4 out of 5 in terms of sales market pressure, one point above Victoria. Finally, let's talk about the rental market so we can complete the score for Queensland.
For rental market pressure, we will look at the vacancy rate. In Brisbane, vacancy rate is now 0. 9%, just slightly higher than last year, but it is still much lower than its long-term average. And in regional Queensland, most of the regional cities are seeing lower than 1% vacancy rate as well. We can see how tight the markets are over there.
The only regions that are seeing higher than 1% vacancy rates are regions with large number of apartment buildings. You may ask, why am I counting in apartment buildings here? That is because all the vacancy rate data available now are counting in both houses and apartments. To give you some examples with higher vacancy rates, one is First Paradise in Gold Coast, seeing 1. 9% vacancy rate, and the other also in Gold Coast, Broad Beach, with a 1.
2% vacancy rate. To give Queensland's rental market a pressure score, we would say a 5 out of 5, just because almost all regions in Queensland are seeing lower than 1% vacancy rate, and we are not seeing significantly improvement in them. So totaling these scores up, we get 13 out of 15 for Queensland, and that is higher than Victoria's 11 out of 15, putting Queensland ahead of Victoria on our leaderboard. Make sure not to miss out on our next episode where we talk about South Australia and everything you need to know about it as an investor. Hit that subscribe button so you don't miss a thing.
If you get any questions about this episode, leave a comment below. I'm Junge Ma, Lead Research Analyst at InvestorKit. I'll see you next week.
