Summer market heats up on Coast
Southern buyers are flocking to the Gold Coast market, with forecasts suggesting the biggest summer sales period in a decade, write Michelle Hele and Kylie Davis
THE lower Australian dollar, revitalised tourism and infrastructure investment are underpinning renewed buyer interest in the Gold Coast property market, which is expecting its biggest summer sales period in 10 years.
Figures from RP Data show that the market is officially off the bottom with an increase in housing values of 3.3 per cent over the past 12 months.
An analysis of the Gold Coast and greater Tweed area by PRDnationwide research predicts the Glitter Strip may be about to emerge into a period of sustained growth. The research backs agent observations that the market is primed to enter a cycle of growth not seen since before the global financial crisis hit in 2007.
PRDnationwide research analyst Jake Beazley said a softening Australian dollar and low interest rates had helped renew buyer confidence. He said vendor expectations had dropped into line with market valuations and this had sparked a resurgence in the market.
“Increased competition for limited stock is already starting to drive price appreciation in some suburban locations,” he said.
The Gold Coast has enjoyed a massive infrastructure investment spree from both the government and private sector. Nearly $10 billion is being invested on the Gold Coast in the lead-up to the Commonwealth Games in 2018 including a $1 billion light-rail network, the $1.76 billion University Hospital and more than $4 billion in highway improvements north and south.
This summer was also one of the strongest for tourism due to a $15 million marketing campaign that ensured record occupancy rates.
“The investment in infrastructure will continue to generate employment opportunities in not only the construction sector, but in health and accommodation services, and the weakening dollar should begin to provide some support for tourism – all of which will be positive for the local real estate industry,’’ Mr Beazley said.
The chief executive of the Ray White Surfers Paradise Group, Andrew Bell, said rising property prices in Sydney and Melbourne meant the Gold Coast was again on the radar of interstate investors.
“With affordability such an issue in the southern states, Melbourne and Sydney buyers are again looking at the Gold Coast market and realising they can buy a property that’s bigger than they can afford at home, has a good rental yield and is at a rate they can afford,” Mr Bell said.
“About 60 per cent of our buyers come from interstate or overseas.”
While most of the country is in shutdown mode in January, each year the Ray White Surfers Paradise group hosts The Event – the Magic Millions of real estate – following the Australia Day weekend. It is recognised as the largest single property sale in the country, with 116 auctions already scheduled for January 27 and an additional 15 prestige properties going under the hammer on January 30. A host of other luxury property is also for sale by expression of interest and private treaty.
Mr Bell said rental vacancy rates were currently about 2.3 per cent, ensuring quality rental stock was in demand and able to command good rents.
PRDnationwide Southport principal Gerald Adam said he was fielding calls from interstate investors as they considered the Gold Coast a more affordable option compared with southern capital cities.
“Buyers are acting decisively, they know the market bottom is long gone but good value is still there,’’ he said.