Gold Coast property market outlook

Simon Pressley — Wed, 12 Aug 2015 05:30:01 +0000

Move over Sydney; Gold Coast is about to flex its property muscle! Of the 550 city councils across Australia, Propertyology anticipates that Gold Coast will be in top echelon of property market stars by the end of 2015 and for the next couple of years. Property sales volumes have been strong with increases of 11% (houses) and 39% (apartments) from two years ago. Median house values have increased by 11.2% during the last two calendar years. Momentum for the Gold Coast property market is destined to accelerate further. In Propertyology’s opinion, property markets will be driven by (arguably) the biggest job market turn around in the country. We also have expectations for Australia’s tourism industry to experience a boom that will be bigger and last a lot longer than Australia’s recent mining boom. Property investors, including an influx of Asian investors, will add further buoyancy while the build up to the 2018 Commonwealth Games on the Gold Coast will ensure that the profile remains high. Historical population growth of almost double the national average can be attributed to the Gold Coast lifestyle. This lifestyle is also the driver of Gold Coast’s number one industry – tourism. When the GFC hit in late-2008, consumer sentiment disappeared, jobs were shed and its property market suffered. Like most of Australia, Gold Coast’s post-GFC jobs market has been stuttery. But, a pipeline of major projects bigger in size than several capital cities has resulted in an incredible transformation. Net jobs growth of 19,662 for the 2013 calendar year was blown out of the water by the 181,856 net jobs in 2014. A scroll through Propertyology’s own research library shapes our expectations for jobs growth to remain high for some time yet. Major projects include the new $1 billion Coomera Town Centre, Commonwealth Games Village ($2 billion), and Pacific Fair Shopping Centre upgrade ($0.7 billion). The proposed $7.5 billion Gold Coast Cruise Ship Terminal and Resort was scrapped by the new state government early in the year however an amended proposal appears to be gaining momentum. Without the ASF project the Gold Coast property market is tracking towards annual double-digit price growth. The potential 30,000 direct and indirect jobs that would be created if the $7.5 billion cruise ship project were completed would be an immense game-changer for the local property market. Boom! Three other major projects, each with a $1 billion investment, include the Jamie Durie inspired Maddison Estate, the Pacific View Estate at Worongary, and the Jewel Hotel and apartment complex at Surfers Paradise. Investors would be wise to keep one eye on Gold Coast’s property supply pipeline. Outside of tourism, construction has long been Gold Coast’s biggest industry. The 4,660 dwellings approved last financial year is well short of the 15,000+ approved in 2004 and 2005 however the curve is trending up again. Job creation during the construction stage of these big residential projects will eventually result in significant new supply. There is scope for a post-Commonwealth Games over supply, especially in the apartment market which last year accounted for 55% of dwelling approvals. Read more: Simon’s Views on the Gold Coast Property Market in January 2015

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Gold Coast Property Market Outlook – January

Simon Pressley — Mon, 12 Jan 2015 23:25:17 +0000

Propertyology expects the Gold Coast market to surprise many pundits and become one of Australia’s best performers during 2015-2017. The storm clouds are gone, the sun is due to shine – and quite brightly. However, there is still some turbulence in the waters. Tourism drives the Gold Coast’s economy. So, when the GFC hit in late-2008, consumer sentiment disappeared, jobs were shed and its property market suffered. The Gold Coast’s only other industry of note is construction and a significant pre-GFC over-supply compounded things for its property market. In spite of having population growth (3.1% pa during 2003-2013) of almost double that of the national average (1.7%), the Gold Coast was the worst performing market in Australia for a few years. As the above graphic shows, building approvals declined considerably post-GFC and a lot of the surplus supply has now been soaked up. Vacancy rates have tightened. Sales volumes and property prices are already growing. Consumer and business sentiment have improved over recent years. The new Gold Coast hospital plus a $1.8 billion passenger rail project have been good for jobs growth. Work has commenced on a $670 million expansion of Pacific Fair which will make it the largest shopping centre in Queensland. The $500 million athlete’s village for the 2018 Commonwealth Games and a $1 billion luxury hotel by Chinese developer, Ridong, are other major projects. The tourism boom which Propertyology boldly predicted two years ago has arrived, meaning things will only get better for the Coast. A decision on a proposed $7 billion mega resort is due in early-2015. An economic impact statement released by the proponent in September 2014 suggests that, if completed, tourism revenue could increase from $1.15 billion per annum to $8.9 billion; 15,000 jobs could be created. By the end of 2015, I believe the data will show Gold Coast to have been one of the strongest markets in Australia. But don’t be fooled, leopards don’t change their spots! Gold Coast Mayor, Tom Tait, is a developer by trade and he is very pro construction. There have been a number of large building applications lodged during the last 12 months. Significant over-supply is expected again in a few years time. Areas with a high concentration of new supply will include Southport, Coomera and Labrador. Read more: Simon’s updated focus on the Gold Coast property market

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Gold Coast property market outlook

Gold Coast Property Market Outlook – January