Unit prices up in beef capital
WHILE hopes that the extended first home buyer’s grant will boost Rockhampton house sales have not yet been fulfilled, the market for units is gaining strength.
When the Queensland Government extended the $20,000 first home buyer’s grant that was due to end on June 30 until December 31, experts expressed optimism that the move would be a shot in the arm for the sluggish market.
These hopes have not yet materialised in the home market, with June quarter data showing the median house price of $261,750 down 1.2% on last quarter.
Over the past five years, the annual median house price in Rockhampton has fallen 9.8%, from $300,000 in June 2012. This is equivalent to an annual fall of 2%.
However, for units it is a different story, with the median price up an incredible 17.4% on last quarter – up 2% from the previous 12 months, with no increase on figures from five years ago.
REIQ’s latest Queensland Market Monitor report says: “in a climate of declining unit demand and prices statewide, it’s perhaps remarkable that the Rockhampton unit market outperformed its house market over the past 12 months and over the past five years”.
Jason Rayner, of Ology Real Estate, says the rise in median unit prices is due to city development, and not indicative of the market overall.
“Those unit sales figures are somewhat expected due mainly to high sales of the riverside apartments, near the CBD,” Mr Rayner said.
“Those sales have pushed the median up. It’s a beautiful development; they are very modern apartments, with everything you could want.
“Overall, I would say the unit market is probably on par with houses.”
Mr Rayner, who has been in the industry for 17 years, says while he believes an upturn in the market is coming, it is still a year or two away.
“There are a few key things that need to happen - and I believe they will happen - for the market to experience an upturn,” Mr Rayner said.
“Once we have some more jobs open up, we will have an increase in rentals. The rentals are sitting at about 7–8% at the moment and we need them to be at about 1–3%. When that happens, rents go up and many renters become buyers. Also, the people who are coming in for work see what a great place it is, and they start buying. Then the local market begins to move – looking to invest or upgrade. House prices start to move. Then we get on the radar of Sydney and Melbourne investors.
“It will happen,” Mr Rayner says. “All the signs are there.”