Busting the boom cycle
The rebirth of Surfers, a tradie boom and developments built to last and designed to please are part of our new property normal – with no end in sight
JUST don’t mention the bword.
True, Gold Coast housing prices are surging, supply is scarce and demand is seemingly insatiable … but this is no boom.
Why? Because, according to experts, there will be no bust.
In the midst of this pandemic which has rebranded almost every aspect of our lives as “unprecedented”, perhaps it’s the transformation of our property market which has truly rocked our foundations.
Whether you like it or loathe it, it’s time to accept the new normal.
Although even Colliers International director David Higgins (pictured) admits it takes some adjustment.
“If you heard this conversation in quarter two of 2020, you’d think we were mad. Whoever expected this to happen? Nobody,” says David.
“But now, when we look at what’s underpinning our huge growth, we can see that these are solid fundamentals … and I don’t think that’s going to change for a long time.
“Of course this growth can’t last forever, but even when it ends, it’s going to be a soft landing.”
While there are still plenty of clouds when it comes to Covid itself, when David looks out to the Gold Coast skyline from HOTA’s rooftop bar, all he sees are blue skies.
He envisions a much-needed rebirth of Surfers Paradise on the horizon, a jobs boom for Gold Coast tradies and a legacy of developments that are built to last – and designed to please. He sees the city like a necklace – its suburban villages the jewels, studded with midrise boutique buildings, and framing the skyscrapers of Surfers in the centre.
“We always hear residents
saying they don’t want
their neighbourhood to look like Surfers,” he says.
“But Surfers may soon look very different. Until recently, most of the projects we were seeing were single buildings of 30 to 40 apartments, there were a few hundred-unit projects but not many.
“However, in the last three months, it’s game on. There’s one project that’s yet to be announced but it’s three towers with 800 apartments and it’s going to completely change the suburb – for the better.
“It’s completely different to Jewel, it’s going to feel good from the ground up and it’s backed up by solid funding.
“I really think we’re going to see a renaissance of Surfers. Everybody agrees it needs a redo and this boost of private investment is really going to inspire its new chapter.
“When it’s all done, I think people are going to want to emulate what’s done there. The fact is that development, when done right, emphasises the character and narrative of a place.
“Look at some of the world’s most beautiful cities, they’re full of development – but you don’t hear people saying they ‘don’t want to look like Paris’. Surfers will never be Paris, but it can be its own place of beauty, both built and natural.”
David says the Gold Coast’s popularity for new developments is hardly restricted to Surfers.
He says Brisbane developers are now flocking to the city with far greater demand here for residential projects than in the Queensland capital.
He says the first quarter of 2021 saw a bumper sales result for new apartments in our city with 742 sales, almost three times Brisbane’s first-quarter result of 277 new apartment sales. “It would be interesting to see if there’s been any effect on the traffic because all those tradies that had to travel north for work can now stay at home. It’s those in Brisbane who have to travel south.
“Other than the Queen’s Wharf development and Mirvac’s recent release in Newstead, there is really nothing much happening there. Brisbane just isn’t the place that people want to be, whereas the Gold Coast is.
“Buyers are definitely choosing the Gold Coast due to lifestyle. They are seeking to live in a regional city close to the beach with an international airport – and this reflects the sentiment of Australians seeking better work-life balance.
“It’s interesting because all of these years, and I’ve been working in the property industry over three decades, we have often relied on interstate and overseas investors and we would fly around the country and world looking for people to put their money into the city – but now it’s all just happening organically.
“We’re not asking, but they’re begging to come.
“It’s just a crazy time … I have people calling me asking me to put them on my email list. For an agent that is just unheard of. Usually people are asking you to take them off. It’s just another sign of the times. This is probably the number one place in the world where people want to live.”
David says the huge interest in owner-occupied apartments has gifted the city with a high calibre of architectural design.
And he says the buyers are not always who residents might expect.
“It’s really interesting that with all of the discussion about development in Palm Beach and the furore about the changing skyline in that suburb, that 70 per cent of buyers in these buildings are Palm Beach residents.
“They are the people who lived in single-dwelling houses and who want to downsize or get closer to the ocean or both.
“So much of the interest that we are seeing in new developments is coming from locals who want to stay in their own suburb – they just want more amenity and less maintenance.
“The great thing about that is that when you’re building for owner-occupiers, you just don’t cut corners, not in design and not in finish.
“We are seeing some beautiful buildings coming out of this Covid boom, and that’s a wonderful legacy for the city.”
Despite the growth in the high-end market, whether high-rise or houses, David says it’s essential the city provides more stock when it comes to the “missing middle”.
He says mid-rise developments of around 10 storeys could help fill this gap, with the locations of Chevron Island, the area near Harbour
Town and the western side of Mermaid Beach becoming prime positions.
“We have worked well to provide a fairly steady supply of luxury stock on the Gold Coast, but we need to make sure we offer something other than five-star. We need to offer a lot more in that $600,000 to $1.5m bracket.
“There’s plenty of conversation around affordable housing, but we also need to build housing for our key workers. If we are looking to attract more people to work in our health and education industries, we need to build somewhere for them to live.
“That’s where mid-rise developments can really work.
“Already, we’re seeing Chevron Island become hot property, as well as land surrounding Harbour Town. It offers great amenity in terms of shopping and the Broadwater.
“Further south, the west side of the Gold Coast Highway in Mermaid Beach could be attractive, especially as there are some larger sites that are ripe for redevelopment like Putt Putt and the old Sizzlers.
“Ultimately, people want a village location, access to public transport and walkability.”
While David says the surge in prices and demand cannot last forever, he believes the eventual slowdown will come from complications with supply.
He says the rising cost of land, building materials and labour is reducing the profit margin for developers.
“Even if we continue raising prices, there comes a point where accessing the amount of money necessary to develop a project becomes unfeasible.
“I think that is what will ultimately cause a slowdown.
“The principles underpinning our growth are not going away – people have learned to work remotely and this is where they want to base their home office.
“It may feel like we’re flavour of the month but the fact is that we’re simply the new favourite flavour.
“We’ve come of age as a city. Just look at our arts, our restaurants, our fashion. Plus our interstate migrants are bringing a real boost of southern culture as well. It’s fantastic to see.
“This is the beginning of a new era for the city.”
It’s not a boom, there is no bust … maybe it’s just our own Big Bang.
This is the beginning of a new era for the city