A Big Four bank has expressed concern over “strong risks” in Brisbane’s concentrated new unit market, warning a major fall in prices will spill over to houses.ONE of Australia’s Big Four banks has warned that a shock to unit prices will spill over to houses — and Brisbane is in the crosshairs.ANZ has run the numbers on Brisbane’s unit oversupply and warned there were “strong risks” arising out of the concentration of unit supply in the inner city which could see any price shock spill over to the housing market. ANZ bank has warned that Brisbane was already seeing unit prices fall.In latest Economic Insight report, ANZ Research revealed analysis on the spillover effect of a 10 per cent drop in Brisbane unit prices on other parts of the market, concluding there would be a “direct negative impact” on local house prices that could last for over a year.It said such a shock would see a 4 per cent fall in Brisbane house prices three months after the shock, while a similar drop in Sydney and Melbourne would see much higher levels of price cuts.“A sharp drop in unit prices has a direct negative impact on local house prices in all three cities, with the negative effect lasting around four to five quarters,” ANZ Research said.More from newsMould, age, not enough to stop 17 bidders fighting for this home1 hour agoBuyers ‘crazy’ not to take govt freebies, says 28-yr-old investor7 hours agoThe Big Four bank said the “sheer number of apartments set to come to market over the next 18 to 24 months is raising fears of oversupply and the possibility of corresponding price falls.” “Indeed, Brisbane unit prices are already falling.”Nationally the backlog of work was sitting at 220,000 dwellings worth $35 billion, but it was the concentration of units in Brisbane’s inner city that raised the alarm. While a major unit price drop in Sydney would impact Brisbane, the same could not be said for the reverse, according to ANZ. Picture: Destination NSWANZ Research warned that while Sydney and Melbourne saw a wide geographic spread in apartment supply, Brisbane’s construction boom was “heavily focused” in the inner city.“The concentration of building in such a small geographical area is likely to raise the risk of oversupply emerging, in our view. At the same time, Queensland’s population growth sits around historical lows in the post-mining boom period, which exacerbates the risks in this market.”The Big Four bank said it was “potentially seeing the start of this development right now” with Brisbane unit prices sitting 2.1 per cent lower than a year ago. “On the other hand, Melbourne prices are still rising (3.2 per cent year on year), and units in Sydney are experiencing strong growth (15 per cent year on year).”“With the additions to supply set to keep coming in Brisbane, there is a strong risk that we will see this trend persist for some time.”The bank analysis found that while any price falls in Sydney would have repercussions for Brisbane and Melbourne, a price correction in Brisbane “has no spill-over effect on the other cities”.