In days gone by, it was common for families to go to the same place, at the same time of the year, for every holiday period. Some even invested in their very own beachside shack.
But Domain Group chief economist Andrew Wilson believes the glory days of secondary properties such as holiday homes started to fade away nearly a decade ago.
“I think we’ve lost the real prosperity effect of secondary property purchases that we had prior to the GFC … and the ultimate discretionary purchase is a holiday home,” he says.
“Australians always felt like they’d made it when they bought a holiday home. Those social dynamics are changing and it’s not just an affordability issue. I think the whole nature of holidays is changing as well.”
Affordability is part of the equation, but it’s not just about the increased cost of housing. International travel has become much cheaper so families are often heading to Thailand and Bali instead of Noosa and Cairns.
He says the desirability of Queensland’s premier beachside locations also means that property prices are now no longer considered affordable enough to invest in a holiday house that will provide decent returns.
But Real Estate Institute of Queensland Gold Coast zone chair John Newlands says holiday homes or units still make financial sense in his region.
He says there remains good opportunities in the $350,000 to $550,000 price range.
“Properties from Broadbeach to Southport are in demand, especially because those suburbs are now also serviced by the light rail,” he says.
“People are attracted to the Gold Coast because of our weather, relaxed lifestyle and the fact that our population is forecast to double by 2050.
“If you can get the right combination of a good property, with reasonable body corporate fees, then you’re going to have someone in there paying it off for you.”
Likewise, Amber Werchon, principal of Amber Werchon Property in Mooloolaba, says holiday homes can still achieve good capital growth.
The Sunshine Coast market has recorded strong property price growth of late and the rental market is picking up, too, she says.
“There are two ways to make money with your holiday home – capital growth and rental returns. If you chose to holiday rent, then you have the added bonus of using it yourself, too,” she says.
“Capital growth-wise, there are a number of Sunshine Coast locations where we’ve seen the median sale price increase significantly over the past 12 months.
“Alternatively the permanent rental market is tight, as tight as 1 per cent in some locations such as Caloundra.”
She says the median house price in Minyama increased by 35.4 per cent during the past 12 months, while the median unit price in Noosa Heads grew by 39.2 per cent over the same period.
Original article published at www.afr.com by Nicola Thompson 13/9/16
Top 68 suburbs for growth in Queensland revealed. New data has shown the top 68 suburbs in Queensland for capital growth over the last 12 months to June, with the number one spot reaching triple digits.
Top 68 suburbs for growth in Queensland revealed
Outlined in the Real Estate Institute of Queensland’s Queensland Market Monitor report, REIQ CEO Antonia Mercorella said despite the ‘doom and gloom’ of the property market, there are still locations that are seeing large gains in profitability.
“A total of 68 suburbs throughout Queensland have delivered double-digit growth over 12 months, which is a really strong result,” Ms Mercorella said.
“And there are many more suburbs delivering strong single-digit growth. It’s a great market to be in at the moment.”
While south-east Queensland saw a lot of attention, there were some high growth suburbs found in central and northern Queensland.
The area with the strongest growth was Blackwater, which saw a rise of 151 per cent growth, which Ms Mercorella attributed to the resurgence of coal prices.
Aside from Blackwater, 10 other suburbs saw growth over 20 percent. These included:
Spring Mountain with growth of 103.6 per cent;
Collinsville with growth of 46.2 per cent;
Minyama with growth of 45.8 per cent;
Hamilton with growth of 32.9 per cent;
Hollywell with growth of 30.5 per cent;
Miles with growth of 23.5 per cent;
Mount Coolum with growth of 21.9 per cent;
Dundowran beach with growth of 21.5 per cent;
Boonah with growth of 21.3 per cent; and
Idalia with growth of 21.3 per cent.
Ms Mercorella said the top 11 suburbs were indicative of steady growth across the state, but warned against calling it a ‘boom’.
“While we’re definitely seeing prices come back in western Queensland mining towns, such as Blackwater, these prices are still below their peak,” she said.
It’s unlikely we’ll see a return to pre-2013 prices in those areas anytime soon.”
While the top 11 suburbs show a spread of high growth suburbs through the state, 41 suburbs out of the 68 are located in the ever-popular south east corner of Queensland.
Of these, 15 suburbs were located in the Sunshine Coast region, with the highest growing being Minyama, which ranked fourth overall.
The Brisbane region also saw a large number of high performing suburbs at 13. Hamilton was the region’s best performer and fifth overall.
Next was Ipswich with six suburbs, then the Gold Coast with four, Moreton Bay with three, while Redland and Logan suburbs did not rank.
Outside of south east Queensland, 27 regional suburbs ranked on the list, with the Townsville region recording four suburbs. Its highest performer was Idalia, which ranked 11th overall.
Next were the Cairns and Gympie regions, both recording three suburbs each. Cairns’ top performer was Palm Cove, which ranked 26th overall, while Cooloola Cove was Gympie’s top performer, which ranked 42nd overall.
While only recording one suburb, the Whitsunday region’s Collinsville ranked third overall.
The Bundaberg and Toowoomba regions both recorded two top suburbs, while the Banana, Charters Towers, Fraser Coast, Gladstone, Isaac, Livingstone, Mackay, Rocky, Scenic Rim, Somerset and Western Downs regions all had one top suburb each
The top 68 suburbs which experienced double digit growth over the last year to June 2018, according to the REIQ, are:
HOME values rose in seven of Queensland’s nine subregions in the past year, despite widespread fears of a cooling housing market.
It comes as Brisbane is ranked 20th on a global list of cities measuring residential property price growth over the past year, with the city recording above average 3.5 per cent growth.
Research from property data supplier CoreLogic reveals the Sunshine Coast recorded the biggest rise in home values over the past 12 months – increasing 6 per cent.
Homes in Brisbane’s western suburbs increased in value by 4.4 per cent in the same period, followed by Moreton Bay South, with a gain of 2.5 per cent and inner Brisbane with a rise of 2.1 per cent.
Home values in Logan, Brisbane’s eastern suburbs, Gold Coast, Wide Bay, Brisbane’s north and Moreton Bay North also rose marginally.
At the same time, only one of Sydney’s 15 subregions recorded an annual rise in home values.
CoreLogic head of research Tim Lawless said that with property values falling across four of the eight capital cities over the past twelve months, it was easy to forget some housing markets around the country were actually seeing relatively healthy and sustainable growth.
Almost half of Australia’s 88 SA4 subregions recorded a rise in dwelling values over the past twelve months.
Regional areas of the country are more likely to be showing positive growth conditions, with 57 per cent of all regional areas recording a rise in dwelling values over the year, compared to only 39 per cent of the capital city subregions.
Mr Lawless said the ‘healthier’ conditions across the regional markets could probably be attributed to more sustainable growth conditions during the growth phase, compared to the likes of Sydney and Melbourne.
“The more sustainable history of price growth has kept a lid on housing affordability and made these markets attractive to migrants, particularly those areas where economic conditions are buoyant,” Mr Lawless said.
“A ripple of demand has been emanating from the largest capitals towards the satellite cities where housing is generally more affordable and lifestyle factors can be appealing.
“Many coastal and lifestyle markets have benefited from a rise in buyer demand, either from those looking for a new residence, second home or investment option.”
Mr Lawless also said many of the hard hit mining regions had now levelled out and were starting to show growth.
He said the data highlighted the diversity across Australia’s housing markets.
“While conditions are broadly slowing, especially around Sydney and Melbourne, many areas of the country are benefiting from a history of more sustainable growth rates, improving demand and reasonably strong economic conditions,” Mr Lawless said.
It comes as Knight Frank ranked Brisbane 20th on its Prime Global Cities Index.
Sydney came in 17th place, Melbourne sits in 21st place and Perth sits in 24th place.
“Despite a cooling mainstream market off the back of tighter lending practices, Australian prime markets continue to experience growth with buyers less impacted by these measures,” Knight Frank’s head of residential research Australia Michelle Ciesielski said.
Experts are hailing the Sunshine Coast as Australia’s next property market hotspot, with the beachside suburb of Maroochydore set to reap the benefits.
According to Hotspotting.com.au, the Sunshine Coast is currently at the start of a long-term growth cycle.
“Momentum started building two years ago and has really been increasing over the past 12 months, and we’re now seeing that translate into solid growth,” founder Terry Ryder says.
In the housing market, many suburbs have had double-digit growth over the past year, with many others close to 10 per cent, he adds.
The growth is all due to the fundamental change that has taken place on the Sunshine Coast, with strong infrastructure spending and a broadening economy moving away from its reliance on tourism.
“It’s really all about infrastructure spending,” Ryder says. “The total list of projects recently completed or under construction is over $20 billion, which is huge for a city of this size.”
The $2 billion Sunshine Coast University Hospital, which opened in April 2017, was a significant project for the region, along with the $150 million private hospital built in association with it.
Current major projects include a $1 billion upgrade to the Bruce Highway, a $347 million expansion of the Sunshine Coast Airport and the creation of a new $430 million Maroochydore City Centre, which will include commercial, retail, entertainment and residential components.
“All of this brings new businesses into the Sunshine Coast, diversifies the economy and creates a lot of jobs,” Ryder says.
He says Maroochydore was the logical choice for a new CBD in the region, being not only at its geographical centre, but also its “nerve” or commercial centre.
The Milk Bar Coffee Co owner and chef Alex Cossell decided to open his business on Maroochydore’s Sixth Avenue, just one block from the beach, more than two years ago, identifying an opportunity in what he describes as a “central hub” filled with plenty of locals and tourists.
“The cafe culture is epic,” Cossell says. “There are plenty of amenities within the area too, with great parks and playground areas for the young families.”
Cossell believes Maroochydore will be completely different in five years’ time.
“It is definitely growing at the moment, with so much more expansion in the works with the new CBD development just around the corner.”
Plenty of buyers, particularly locals, are also excited by what’s taking place in and around Maroochydore. They’re being drawn to the thriving area, taking advantage of the chance to buy before is it completely revitalised.
Rise Maroochydore Beach, a new luxury ocean-view development offering 48 apartments, is proving to be one popular opportunity.
The 12-storey building, situated on Sixth Avenue in the Cotton Tree neighbourhood of Maroochydore, received more than 700 expressions of interest prior to its launch, according to Colliers International.
It appeals to owner-occupiers as it has generously sized two- and three-bedroom configurations, as well as two-level, four-bedroom penthouses, with prices ranging from $500,000 to $3 million.
“The Sunshine Coast used to be known for Mooloolaba and Noosa, but it’s becoming a lot more known for Maroochydore,” says Daniel Hirst of Colliers International, who is marketing Rise.
“Mooloolaba and Noosa are more holiday accommodation areas, while the Maroochydore and Cotton Tree areas are becoming a preferred residential choice for people who want to live in high-quality luxury apartments and have restaurants close to hand.
“They are professional couples in their mid-40s, people upgrading with young families, downsizers, retirees and semi-retirees.”
Rise offers a point of difference to other apartment developments, Hirst says, in that it benefits from Maroochydore’s growth but it’s not right in the hub of all the activity. Rather, it’s within easy walking distance.
“It’s connected to everything but it still has a quiet lifestyle,” he says. “You can walk a couple of hundred metres to the beach, restaurants and cafes, but you don’t have all the foot and vehicle traffic at your front door.”
Rise is also unique in that it offers the closest new apartments to the ocean in Maroochydore, with development of this scale currently not allowed any closer – which also means the views can’t be built out.