Everyone Tells You to Buy Brisbane. The State's Balance Sheet Says Otherwise.

The entire Australian property content machine is telling you to invest in Brisbane. Population growth. Olympics 2032. Five years of stellar price appreciation.

I am going to tell you something different. And I have receipts.

Look past the glossy headlines and examine one number that nobody in the Brisbane property space wants to discuss: Queensland government debt. By the 2027-28 financial year, Queensland's projected per-capita net debt will reach approximately $40,000. For context, Victoria's per-capita debt — the one that triggered the land tax threshold reduction, the vacant property tax, and the absentee owner surcharge that hammered Melbourne's investment market — peaked at roughly $28,000.

Queensland's debt trajectory is 43% worse than the policy trigger point that caused Victoria's property market correction.

I am not predicting a crash. I am pointing out that the fiscal conditions that preceded Victoria's investor-hostile tax changes are now replicating in Queensland, at a higher magnitude. History does not repeat, but it rhymes. And this rhyme scheme is getting uncomfortably familiar.

The debt spiral that nobody discusses

Queensland's budget position has deteriorated sharply. The combination of infrastructure spending (Olympics preparation, Cross River Rail, Gold Coast Light Rail extensions) and softening commodity revenues has pushed the state into structural deficit.

S&P Global has already flagged Queensland for a potential credit rating downgrade if debt trajectories are not contained. A downgrade increases the state's borrowing costs, which in turn increases the pressure to find new revenue sources. And in Australia, the most politically expedient revenue source for state governments is property-related taxation.

Victoria demonstrated the playbook in 2023-2024:

1. Revenue falls short of spending commitments
2. Government reduces land tax thresholds
3. Government introduces vacant property taxes
4. Government increases foreign buyer surcharges
5. Investors exit or reduce exposure
6. Property market softens
7. Revenue falls further (because transaction volumes decline)
8. Government introduces more taxes

Queensland has already flirted with Step 2. The cross-border land tax aggregation proposal — where Queensland would have counted your investment properties in other states toward your Queensland land tax liability — was floated, debated, and ultimately withdrawn. But it was withdrawn due to political backlash, not because the fiscal pressure has diminished. The pressure has gotten worse.

When a government floats a tax proposal and withdraws it, that does not mean the idea is dead. It means the timing was not right. When the next fiscal crisis hits — and with $40,000 per capita in debt, it will — that proposal returns.

"I was buying Brisbane in 2019. I would have bought Perth in 2021. But in 2025, buying Queensland property is not contrarian — it is consensus. And consensus trades are how ordinary investors get hurt." — Joey Don, PremiumRea

The Olympics myth

The 2032 Brisbane Olympics is the single most cited reason for investing in Queensland property. It sounds compelling. Billions in infrastructure spending. Global attention. Tourism boom.

Except the historical evidence does not support the thesis.

The 2000 Sydney Olympics were held during a period of strong economic growth. Property prices rose, but they were rising anyway. The Olympics accelerated a trend that already had fundamental support.

The 2020 Tokyo Olympics (held in 2021) and the 2024 Paris Olympics were held during periods of economic uncertainty. In both cases, the host city's property market did not materially benefit. Tokyo's residential market was flat. Paris saw a brief rental spike followed by normalisation.

The pattern is clear: if the underlying economy is strong, Olympics infrastructure adds a tailwind. If the economy is soft, the Olympics are a money pit that exacerbates fiscal problems without generating proportional economic returns.

Queensland's economy in 2025 is not firing on all cylinders. Mining royalties are volatile. Interstate migration has slowed from its COVID peak. And the state government is spending billions on Olympic infrastructure while simultaneously running structural deficits.

The Olympics is not an investment thesis. It is a marketing brochure.

Where the money should go instead

If you already own Brisbane property, hold it. Capital growth over the past five years has been strong, and there is no immediate trigger for a sharp correction. The risk is medium-term (3-7 years), not imminent.

But if you are considering a new purchase — particularly at today's Brisbane prices, which have more than doubled in many suburbs since 2019 — I would redirect that capital to Melbourne.

Melbourne has already endured its tax-related correction. Victoria's land tax changes are priced in. Investors who were going to exit have exited. The worst-case scenario has already played out, and the market has absorbed it.

Brisbane, by contrast, has not yet experienced its tax reckoning. The fiscal conditions are building toward one. When it comes — and it will — Brisbane prices will face the same headwinds that Melbourne endured in 2022-2024.

The smartest capital allocation right now is to take profits from states that have run hard (Queensland, Western Australia) and redeploy into the state that has corrected and is now recovering (Victoria). This is basic cycle investing. Buy low, sell high. Melbourne is low. Brisbane is high. The maths is not complicated.

One hundred and thirty million dollars in Melbourne buys two premium southeast houses generating $1,600/week in dual rental income. The same budget in Brisbane buys one house with a 3% yield and questionable medium-term capital growth. The opportunity cost of Brisbane loyalty is measured in hundreds of thousands of dollars over a decade.

Frequently asked questions

Are you saying Brisbane will crash? No. I am saying the risk-reward profile has deteriorated. Brisbane may continue to grow moderately, but the asymmetric risk — the possibility of tax changes that would impair investor returns — has increased materially. Melbourne's risk-reward is better because the downside has already been realised.

What about Brisbane's population growth? Population growth is real but decelerating. The COVID-era migration surge has normalised. And Brisbane's GDP is a fraction of Melbourne's — roughly 5% — yet house prices have converged. That pricing misalignment cannot persist indefinitely.

Should I sell my Brisbane property? Not necessarily. If your property is cash-flow positive and you have a long holding horizon, the fiscal risk is manageable. But I would not add to a Queensland portfolio until there is more clarity on the state's revenue strategy.