Fall­ing va­cancy her­alds re­cov­ery

Jobs key to ris­ing hous­ing mar­kets

Townsville Bulletin - - NEWS - TONY RAGGATT

SOAR­ING me­dian house prices in cities like Syd­ney could prompt an ex­o­dus to re­gional cen­tres like Townsville if job se­cu­rity con­cerns can be al­layed, valuers Her­ron Todd White say.

HTW Townsville di­rec­tor Jason Searston said Townsville’s af­ford­abil­ity com­pared with cap­i­tal cities was cer­tainly a good mar­ket­ing tool.

“When you are cash­ing out in a boom­ing mar­ket and com­ing to one that has been grounded, there is sig­nif­i­cant po­ten­tial to cap­i­talise on that,” Mr Searston said.

“How­ever, I think job se­cu­rity is para­mount. You are not go­ing to cash out with­out hav­ing some­thing to go to.”

Prop­erty re­ports this week in­di­cated Syd­ney’s me­dian house price had topped $ 1 mil­lion, sur­pass­ing Lon­don, where the equiv­a­lent me­dian was about $ 900,000.

The Syd­ney me­dian in­creased HOUS­ING va­cancy rate data shows re­gional cen­tres are mov­ing slowly to­wards a re­cov­ery, ac­cord­ing to the Real Es­tate In­sti­tute of Queens­land.

The in­sti­tute’s CEO, An­to­nia Mer­corella, said re­gional Queens­land con­tin­ued to strug­gle to find its feet fol­low­ing the re­sources down­turn but some of the hard­est hit were now en­ter­ing a sta­bil­i­sa­tion phase.

“We can see those towns, where em­ploy­ment rates are stronger and op­por­tu­ni­ties are greater, that the rental mar­ket is re­cov­er­ing more quickly,” Ms Mer­corella said.

The in­sti­tute said Townsville’s va­cancy rate had dropped by 0.6 22.9 per cent to $ 1,000,616 in the year to June.

By con­trast, Her­ron Todd White’s Townsville in Fo­cus re­port says the city’s me­dian house price has fallen 5.4 per cent to $ 342,500 in per­cent­age points to 5.3 per cent at the end of June af­ter a spike in va­can­cies at the end of March.

“Un­em­ploy­ment is still a ma­jor is­sue for the re­gion.

“How­ever, with a new school be­ing an­nounced in the ( state) bud­get and the con­tin­ued sta­bil­is­ing pres­ence of gov­ern­ment em­ploy­ers such as the De­fence Force, Townsville seems to be headed in the right di­rec­tion.”

The va­cancy rates for the other ma­jor re­gional mar­kets in Queens­land were: Cairns 2.7%, Bund­aberg 4.6%, Gladstone 5.2%, Mackay 9.1%, Rock­hamp­ton 6.0% and Toowoomba 3.1%. the year to March. “Our gen­eral im­pres­sion is that ( Townsville) house val­ues have stopped de­clin­ing but that buy­ers are not stray­ing out­side their com­fort zones and have low­ered their as­pi­ra­tions, only buy­ing prop­er­ties they re­gard as af­ford­able based on their cur­rent eco­nomic cir­cum­stances,” the re­port says.

Mr Searston said there was no doubt that growth in cap­i­tal city prices in the past had been a driver of re­gional mar­kets.

How­ever, he said un­cer­tain­ties in re­gional mar­kets, par­tic­u­larly re­lated to the down­turn in min­ing, was also a big fac­tor.

“One would an­tic­i­pate that af­ford­abil­ity is­sues that are be­ing ex­pe­ri­enced would have to, at some point, cause peo­ple to con­sider a move to a more af­ford­able lo­ca­tion,” Mr Searston said.

The HTW re­port says the me­dian price for es­tab­lished units has also dipped, fall­ing 11.2 per cent to $ 227,900 in the year to March, while the me­dian for new units in­creased marginally to $ 332,500 on thin vol­umes of sales.

It says the me­dian price for blocks of va­cant land has re­mained within a band of $ 155,000 to $ 160,000 for the past four years.

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