Location: Bli Bli, Sunshine Coast, Queensland, Australia
Posts: 33
Sunshine Coast house market is tipped to rise 22%
Here is an article which was recently writen in the Sunshine Coast Daily. I thought that it may be helpful to those coming out:
Coast house market is tipped to rise 22%
Despite a slowing national economy and consistent interest rate rises this year, the Sunshine Coast housing market is predicted to show steady growth over the next three years.
According to BIS Shrapnel’s latest Residential Property Prospects 2008 to 2011 report, the Sunshine Coast will follow Brisbane’s lead and should have median price increases of about 22% over the three years to June, 2011.
Senior project manager Angie Zigomanis said key drivers such as population growth, low vacancy rates and a rising rental market were good news for the Coast.
“This is having a two-pronged effect, with more owner-occupiers moving to the Sunshine Coast and higher rents encouraging investors into the market,” he said.
“Having said that, though, since August we’ve had four interest rate rises by the Reserve Bank and a few independent rises by the financial institutions, which has knocked the stuffing out of the recovery of the market and over the next 12 months we can expect relatively flat conditions with minimal growth.”
Mr Zigomanis said another interest rate rise was expected in September, which could also impact the property market into early 2009.
But he said, beyond that, the Sunshine Coast could expect steady growth in the residential property market.
“Once interest rates stabilise, the market will start to strengthen again and with low vacancy rates, rising rents, and strong economic and wage growth in Queensland, affordability will improve a little bit more and owner-occupiers and investors will come into the market,” he said.
“Most of the growth is expected from 2009 to 2011, but the next 12 months will be slower.”
Mr Zigomanis said weakening markets in other areas of the country had also led more people to move to south-east Queensland, where housing was still considered relatively affordable.
“Obviously there are parts of the Sunshine Coast which are still pretty expensive, like Noosa, which is on par with other areas like Sydney or Melbourne, but there is also the lifestyle and the climate which appeals to people as well,” he said.
And the reason the Coast could expect some growth while other centres were slowing was because of its limited supply, he said.
“Compared with the USA, where they built too many dwellings and had more than the number of households, the population growth here in Australia has picked up thanks to overseas migration, but we don’t have as many homes, and because there are not enough dwellings, it has maintained upward pressure of the market,” he said.
“For the Sunshine Coast, that means predicted growth of about 22% over the next three years, so roughly 7% per annum, which is not a huge amount more than household growth.”
He said Queensland’s strong economy, on the back of the resources boom, also put it in good stead for the next three years.
And, he said, coastal areas were predicted to show stronger growth than hinterland regions, although property sales at the very top end of the market could slow as a result of some investors losing money on the share market.
As for first home buyers, Mr Zigomanis said there was an opportunity over the next 12 months to haggle for prices, bearing in mind increased interest rates.
He said he expected housing prices on the Sunshine Coast to peak by about 2011.
We live on the Sunshine Coast in Montville. Perhaps the most beautiful part of the region - everyone seems to say so. A neighbour recently had their property valued for sale purposes at over $900,000. Whilst our house isn't an exact copy of theirs, it is similar in terms of build quality, land valuation, views and number of bedrooms/bathrooms. Ours has more garage space, decking and is far more private.
Bought as a vacant block, we developed this and plonked a house on it. Total bill to date - about $600,000.
That was 3 years ago.
Personally I think my neighbour's property was over valued. Perhaps to gain the business of the client? Who knows what tricks some agents use. On their trusted 'figures' our place is worth a cool million, of that there is no doubt.
Bollocks! I don't mean to offend but it's clear, given what sells and what doesn't in these parts, that a true sale price would be closer to $750,000.
Speculators annoy the pants off me. Yes, let's make everyone feel good about themselves. 22% on an already inflated $1M plus. Whose leg are we pulling here? And what hope for the first time/second time/even third time buyer if that is truely going to happen. This is irresponsible publishing that suggests to investors (the only ones fuelling the market) to get in quick - thereby fuelling the market further and forcing up rents, or, the altenative: everyone just laughs it off and we all stay where we are.
I'm one of the lucky ones. I don't have a mortgage on this place, and I do have an investment property that is currently mortgaged and tenanted. But that's a long term investment and right now, with interest rates the way they are, it's simply not a good thing to gloat. It sends out the wrong message.
I remember moving into my first mortgaged house in the UK. 99 pounds down on a Barratt 2 bedroom and a fixed low interest rate for a year. Overnight we changed our minds and went for the 3 bedroom one - it was only 3000 pounds more (sorry - no pound sign on an Aussie keyboard) but still the same 99 pounds down. What a great start for a first timer!
If only something similar were available today on the Sunshine Coast. Where will all the young people move too?
Since I've had no response I would just like to add that shortly after posting this article our local news ran a story about the frightening increase in the number of young people sleeping homeless, under bridges and in doorways in the Sunshine Coast region. Quoting: "You expect to see homeless people on the streets of Sydney or Melbourne, but not here on the Sunshine Coast". Really, why on earth not?
Rent has become very expensive here, relative to income, and prices of property plus high interest rates mean local kids are leaving home when they really shouldn't do, or some are arriving here for the 'good life' only to realise that the 'good life' is something they left behind.
Who wants to be homeless tonight?
Yes, it may well be "all the talk out here!!!!" but it's not all for the reasons you may well want readers to believe. You are part of the real estate industry, aren't you? What better way to attract people to the region than to dangle the "you can't lose" bait from the housing hook. Fact is, this area is becoming too expensive for a lot of people to live in and it has no great industry and that doesn't bode well for the future of our families, or the future of our region.
To help improve matters, our mayor, Bob Abbott, is trying to fast-track three large blocks of land and to encourage the build of smaller dwellings suited to young people - 2 bedroom town houses (you have to understand that houses here are generally too big for the people residing in them in locations where land is at a premium). Bob sees opening up new land and building small homes as a solution to the housing crisis but at the same time realises that it would be difficult to find a developer willing to pump money into a project that offers 'affordable' housing, which implies 'low profit' for the developer - and he's right. And the first block designated to build upon is also a flood plain... Oh dear. An interviewed American housing specialist stated that going this route - building town houses or dwellings for young people - is not the way forward because it would only lead to the area becoming a "ghetto". A ghetto? Well, let's just sit around on our hands and do nothing then, just in case the scenario of a dark and poor New York neighbourhood is too much to contemplate for the people who saw that report. That's planted the seed. Someone needs a reality check! This isn't America! And that's more irresponsible mumbo jumbo press.
Paul.
PS readers of this post may have acknowledged that we have an investment property of our own, and to a few this may have been viewed as hypocritical, given the argument for affordable rents in the region where we live. This brand new house (4 bedrooms, 2 loos, double garage corner block and less than two minutes stroll to the ocean) is ten minutes drive from Hervey Bay. It rents for $285/week. Maybe that's where all the young people should go and then we can get rid of the problem... head... sand... buried...
