Gas fires up Surat prices
Demand for housing in the Surat Basin is on the rise driven by the coal seam gas boom, writes property editor Michelle Hele
LIKE many of Queensland’s mining regions, property values and rents in the towns that make up the Surat Basin have been on the rise in recent years.
They have not yet reached the unaffordable heights that towns such as Moranbah and Dysart, in the northwest of the state, have hit but property sales numbers are lifting and hand in hand with that has been price growth.
The towns of the Surat Basin are within a few hours’ driving distance of Brisbane and they sit within the centre of Queensland’s coal seam gas boom.
Developers have already recognised demand for housing in the area northwest of Toowoomba and in southern Queensland.
The ranks in regional towns such as Chinchilla and Miles are starting to swell.
Surat Basin Property Group director Greg West says developers are trying to keep on top of the market so prices don’t spiral out of control.
They have a landbank to supply 2500 residential lots in the area.
West says the average price of a standard detached house in Chinchilla, in 2003, was $90,000.
According to RP Data, the median house price in Chinchilla is now $341,000. The median has risen by 47 per cent since 2007 and has grown on average by 16 per cent a year over 10 years.
West says a 60-lot subdivision started in 1980 took 20 years to wrap up, but from 2005 onwards hundreds of lots were being produced and sold.
‘‘I think the demand is currently outstripping supply,’’ he says, ‘‘It is probably mostly due to the timing of bringing land on.’’
He says as a result rents for a house have risen to about $420 a week and competition is growing.
Residential Tenancies Authority figures show rents in the town for a three-bedroom home have risen from $280 a week in June 2010 to $365 a week in 2012. Australian Bureau of Statistics figures show the Chinchilla region has an unemployment rate of just 3.7 per cent.
West says as more workers move to the area developers are trying to get on top of the demand to keep property prices and rents under control.
‘‘We don’t want to end up with houses for $1 million and rents of $2000 a week,’’ he says.
West says while the work may be what attracts residents to the towns initially, many are surprised at the level of infrastructure already there such as hospitals and schools.
‘‘We are now seeing the multinationals (retailers) come out here,’’ he says.
While they are attracting new residents from around the world, he says predominantly they appear to be coming from Brisbane, Sunshine Coast and Gold Coast areas because of the downturn in construction work in those areas.
Property analyst Terry Ryder has named the Surat Basin on his list of hotspots in Queensland.
He says it includes the areas of Dalby, Chinchilla, Jandowae, Miles, Roma and St George.
The hotspots report released earlier this year says the area is on the cusp of its biggest economic and population growth in history and research has shown it will need at least 5500 new workers by 2020.
It says the region ‘‘is coming alive’’ with action connected to the new boom resources sector – conversion of coal seam gas to liquefied natural gas.
The hotspots report says some of the towns in the Surat Basin experienced exceptional price growth from 2005 to 2007, before subsiding in 2008.
‘‘There were signs of price growth revival in 2009 and increasing momentum in 2010 and 2011,’’ it says.
‘‘Despite the high growth levels, the various towns in the region remain quite affordable, most having median house prices in the $200,000s.
‘‘The smaller towns, like Jandowae and Tara, are cheaper.’’