PLUMBERS CRACKS
EXCLUSIVE: Shovel-ready projects fall as national trend bites
THE number of shovel-ready projects on the Gold Coast has plummeted as the city wrestles a national slowdown. Developments seeking plumbing approval – the first step towards actual construction – has dropped almost 70 per cent in a year. However, industry leaders did not believe it would have a lasting effect on the Glitter Strip because of the forecast population boom.
THE number of development applications becoming reality has dropped significantly on the Gold Coast as a national shadow casts over the Glitter Strip.
Tight lending conditions and a building slowdown in Sydney and Melbourne has hit southeast Queensland, with Gold Coast City Council figures showing the number of development applications fell 13.4 per cent in the first quarter of the new financial year, compared to the corresponding three-month period last year.
More alarming is the number of applications being turned into bricks and mortar, with plumbing applications declining 69.5 per cent. Plumbing applications are made by developers as an immediate precursor to construction beginning on their project and are seen as an indicator of the strength of the building industry.
Industry leaders rejected suggestions of a prolonged downturn, saying the decline was in line with national trends and they expected the city to back bounce in the new year.
They point to more than $1 billion of work already signed off the 2019-20 financial year.
New figures from the Australian Bureau of Statistics (ABS) and city council reveal:
● A 69.5 per cent fall in the number of plumbing applications in the three months to September 30, with just 899 received by the council.
● The number of development applications dropped 13.4 per cent.
● Building applications fell 7.1 per cent.
● About 2100 new dwellings were given the go ahead between July and September at a total of $1.23 billion, a 4.5 per cent decline from the same period last year.
According to the council data, the number of annual plumbing approvals has fallen 36 per cent in the past four years.
Several plumbers approached by the Bulletin yesterday said they had experienced a significant drop-off in work in the past 18 months.
“Going in to the suppliers, there doesn’t seem to be as many people waiting for new materials as there used to be,” said industry veteran Sean Donnelly, of Gold Coast Budget Plumbing.
“That’s a fair indication that work has died down, though we have been lucky because of the great client base we have.”
Developer and UDIA Gold Coast immediate past president Stephen Harrison said the decline in building and plumbing approvals was a reflection of national trends.
“Finance has been harder to secure for everyone down to mum and dad investors because even though money is cheaper in terms of interest rates, the criteria to get it became far more stringent,” he said. “The Gold Coast has seen the flow-on effects from this which has been reflected in the figures.
“But both Sydney and Melbourne’s markets have contracted and banks are now starting to lessen the constraints on money and I see this continuing.”
According to the ABS data, much of the development activity is occurring in the city’s central suburbs.
Mermaid Beach topped the list with 494 development applications approved in the first quarter of the financial year, at a total value of more than $280 million. Hope Island (318) and Mermaid Waters (317) were next.
GOING IN TO SUPPLIERS, THERE DOESN’T SEEM TO BE AS MANY PEOPLE WAITING FOR NEW MATERIALS AS THERE USED TO BE
Parkwood, Merrimac and Main Beach were the most stagnant suburbs with no approvals listed. Burleigh Waters, Clear Island Waters, Highland Park, Runaway Bay and Varsity Lakes each listed a single new approval.
City planning boss Cr Cameron Caldwell said he expected the Coast to bounce back in 2020.
“There has been a slight tapering from the record high levels of activity but the market is still very strong in a variety of suburbs across the Gold Coast,” he said.
“As the new decade commences projects like The Star casino, light rail and the airport expansion will be catalysts for growth.”
Gold Coast developer Norm Rix said the slight decline in dwellings approval rates could be an indication of a lack of residential-zoned sites available.
“The problem on the Gold Coast is we are running out of room,” he said. “What we need is more land zoned in the north of the city, in the cane fields, as part of a master plan.”
PLUMBER SEAN DONNELLY