One year on from the announcement that Brisbane would host the 2032 Olympics and Paralympics, a new report from PRD has illuminated how the games will impact the city’s property market.
The games are expected to deliver $8.1 billion in benefits to the Sunshine State, including $4.6 billion in tourism and $3.5 billion in social improvements, such as health and community benefits, according to the report titled Does the Olympics contribute to housing supply?
Research from the report detailed how previous renditions of the Olympics injected housing supply to various highly demanded markets of Tokyo, Rio De Janeiro, London, Beijing, Athens, and Sydney. Housing supply in four of the six previous hosts benefited from the game’s presence, although a lack of planning and management can lead to an underutilisation of new supply, as exemplified by the Rio and Athens games.
Breaking housing supply down into three stages, the report looks at metrics across three stages: one-year post-Olympics, two to five years post-Olympics, and five to 10 years after. Due to the report’s timing, data for stage three can’t be collected from Tokyo (2021) and Rio (2016).
What it found was that housing supply increased massively in the first year after hosting the Olympics. Beijing saw an influx of 9,000 apartments after the 2008 games, while the most recent host, Tokyo, was boosted by 5,632 apartments.
Rio De Janeiro, which also struggled with an inability to utilise infrastructure implemented for the 2014 FIFA World Cup, saw 3,341 apartments abandoned and a further 259 sold.
In the five to 10 years post-Olympics, only two host cities — London and Sydney — introduced new housing supply. The United Kingdom’s capital saw 682 apartments built, while the harbour city added 40 townhouses and 115 units to its stock.
As for how Brisbane will fare after its maiden Olympics, the report said a look at residential development from 2022 to 26 “suggests a greater emphasis on apartments and units, with the majority of new land lots located in the Gold Coast and Sunshine Coast”.
Brisbane’s local government area is heading towards an introduction of nearly 10,000 new properties during that four-year period, while the Gold Coast LGA is expecting almost 16,945. Add to this the $60 million investment into the Olympic Village amongst a raft of other proposed developments, and Queensland is set to experience a marked increase in supply over the coming decade and beyond.
Moreover, PRD highlighted: “In preparation of the 2032 Olympic Games, there are plans to repurpose The Northshore Hamilton Priority Development Area (aka The Village). This will catalyse $500 million in private investment and create 1600 construction jobs. Accommodation supply proposed in preparation of the 2032 Brisbane Olympic Games:
- Two hotel towers of 181 apartments Woolloongabba – Olympic Stadium site
- 182-room hotel development – Mooloolaba
- 196-room hotel tower – Manors Gate Group Broadbeach
- 252 apartments – Signature Broadbeach Project
- 10,000-bed villages in Athletes Village – North Shore Hamilton.”
As for how the 2032 Olympics will impact property prices in the state, history suggests that while it is evident that hosting a major global sporting event does positively impact price growth, there are several conditions that impact the extent of such increases, including economic climate at the time, cash rate movements and investment portfolios.
For example, the double-digit price growth experienced in Sydney at the turn of the century after its Olympics was unable to be matched by the Gold Coast after the 2018 Commonwealth Games.
Between 2003 and 2015, the decade before and first year after Brisbane hosted its last major global event — the 2014 G20 Summit — house prices in South Bank and surrounding areas soared by 111.6 per cent. Applying similar growth levels to the 2032 Olympics means that relatively affordable suburbs, such as Ipswich, will break the $1 million barrier, while Hamilton and Chandler could hit a median price of $4 million.
Article source: www.smartpropertyinvestment.com.au