Brisbane's inner-city will attract investors and up-graders staging a strong comeback in the property market in 2010, according to experts.

Property analyst Terry Ryder said suburbs within five kilometres of Brisbane's CBD would blossom in 2010, with new infrastructure developments like the Clem7 and the Northern Busway.

He said the Clem7 would help prospects in the emerging urban renewal precincts around Bowen Hills and Newstead.

And urban renewal projects, which Mr Ryder described as one of the great successes of Brisbane's real estate market, would generate a hive of activity in the new year.

"Woolloongabba is a suburb waiting to be discovered. It's awaiting a gentrification period, much like Bowen Hills on the northside. Both suburbs have a mix of public facilities, and industrial and residential areas close to the city," he said.

"Woolloongabba has got a lot of potential with Queenslander cottages so close to the city, the busway and soon the Clem7 Tunnel."

The suburbs expected to be next year's best performers have not differed greatly from 2009, as buyers expected to hunt in Albion, Lutwyche and Wooloowin for well-built apartments, most of which are priced below $350,000.

"These suburbs will benefit from the Northern Busway, the Clem7 tunnel and the duplication of the Gateway Bridge which will be completed in 2010," Mr Ryder said.

"Activity was focused on the lower-end of the market in 2009, but 2010 will be more about the middle- market, with people buying their second, third, or fourth home, and a return of investors."

The outcomes of the Henry Tax Review, handed to the Federal Government just before Christmas, would also encourage more people to invest in property, Real Estate Institute of Queensland CEO Dan Molloy said.

"Next year will be the year of investors," Mr Molloy said. "We can look forward to a steady market state, with opportunities for both buyers and sellers."

First home-buyers

Mr Molloy said activity among first home-buyers would slip slightly, but warned their presence in the market should not be discounted.

"Providing first home-buyers are doing their budgets and factoring in butter for increases in interest rates, we would still expect to see them account for their historical average of 20 per cent of buyers in the market," he said.

First home-buyers may be edged out of the inner-city market, but Mr Ryder said investor and first home-buyer bargain-hunters should look towards the burgeoning Ipswich corridor.

He said further interest rate rises in the new year would do little to hamper a recovery in the Brisbane market, although investors would jump back on the buyer band-wagon in the March quarter as the property rally raised fears of an interest rate hike.

The QBE Lenders Mortgage Insurance Housing Outlook released earlier this year predicted Brisbane would have a shortage of 33,000 new dwellings by June next year.

Although the housing squeeze may not have a marked effect on house prices, with the median house price expected to increase just one per cent to $425,000.

But QBE LMI forecasted median house prices would rise 15 per cent by 2012.