The Gold Coast has been highlighted in a recent report, as one of the country’s top performing areas, with a significant increase in prices and sales volumes over the past year.
A recent report on Australia’s major regional markets has highlighted the Gold Coast as one of the country’s top performing areas, with a significant increase in prices and sales volumes over the past year.
The report, released by CoreLogic in May, shows the Gold Coast’s median house price increased 7.2% to $563,500 and 4.8% to $370,000 for apartments over the year to March 2016.
The number of sales is also up 7% and current sales activity is 24% above the five-year average for the city. The average number of days it takes a property to sell has also fallen by four days for both houses (70 days) and apartments (87 days).
There’s also good news in the rental market, with weekly rents up 4.2% to $500 per week for houses (an average yield of 5.1%) and 5.4% to $390 per week for apartments (average yield now 5.9%).
I’ve been talking about the Golden Triangle in South East Queensland for some time now as the pick of the Australian markets, and for different reasons, I see Brisbane, the Gold Coast, Sunshine Coast and Toowoomba being primed for good growth. The 2018 Commonwealth Games will provide an even greater boost to the Gold Coast in particular.
Demand on the Gold Coast is higher due to a lack of stock; more Chinese investors, more interstate investors (particularly from Sydney and Melbourne), and the generation of more new jobs mainly for Commonwealth Games infrastructure and many new residential apartment projects.
The picture right now is rosy, but the future picture is even better.
This is a city that suffered tremendously during the GFC. But in property, what goes down must eventually go back up if the fundamentals are good. And on the Gold Coast, the fundamentals making this an appealing market are improving every year.
Last year, the country’s most authoritative social demographer, Bernard Salt, produced a report called ‘Beyond the Horizon’. The reports seeks to forecast what the Gold Coast will look like by 2050.
Right now, it’s the sixth largest city in Australia with more than 600,000 residents. The population is expected to double in a city that is only 70km from north to south. What will that do to property prices?
This is a city ‘under renovation’ in many ways, the most important being the expansion of its economic base, so it will not be so heavily reliant on retail, tourism and construction industries, which have made the city vulnerable during economic downturns.
But a change is coming with the strategic development of a broader economic base focused on knowledge industries such as health and education.
Knowledge industries are important because it is envisaged that knowledge workers will have more scope to choose where they want to work and live, and the Gold Coast’s lifestyle and relative affordability will be a major drawcard for highly-paid, highly-skilled expert workers.
The city’s 200-hectare Health and Knowledge Precinct is rapidly growing. It incorporates the new Gold Coast University Hospital, research and allied health facilities; and a master planned mixed use community. It is also home to Griffith University, ranked among the world’s top 5% of universities with $500 million invested in recent years to improve its facilities.
Tourism will remain a huge sector for the Gold Coast. In 2013, the city was accommodating 62,000 visitors per night. By 2050, Mr Salt projects the city will host 99,000 on average per night.
Construction should also remain strong for two reasons – the ongoing desire by Chinese and local developers to build along the coast; and the need for more houses in the greenfield suburban corridor between Mudgeeraba and Pimpama.
The Gold Coast of the future will be an international city, with millions already being invested into the Gold Coast Airport to accommodate greater demand and more international routes.
China is the Gold Coast’s No. 1 source market for foreign investment and international tourists. The city is welcoming Chinese interest, with major Chinese developers such as the Wanda and Ridong groups building on the coast and the local council investing $6.8m to build a Chinatown in Southport.
According to Mr Salt, the number of Asian-born residents on the Gold Coast is projected to quadruple by 2050.
All in all, there are exciting times ahead. The Gold Coast, despite recent price growth, is still a ‘Buy’ market in my view. There is plenty of opportunity, especially for cashed-up buyers from Sydney and Melbourne, to buy well on the Gold Coast for investment or a wonderful lifestyle change.
Original article published at www.switzer.com.au by John McGrath 14/6/16