A new report* released by renowned research, planning and economics firm Urbis has suggested that while the Sunshine Coast apartment market is currently significantly more affordable than major capital cities like Melbourne and Sydney, the window of opportunity for buyers to purchase housing at an affordable price point will soon close as a result of the strong population and employment growth predicted for the region.
Urbis Associate Director Paul Riga said the Sunshine Coast had undergone substantial investment in its core infrastructure over the past five years and the further $5 billion in infrastructure investment planned for the region over the coming 10-15 years would play a significant role in driving the residential property market.
“What’s interesting is that while the median sale prices of residential properties on the Sunshine Coast are currently between $68,000-$290,000 less than those in Brisbane, Sydney and Melbourne, gross rental yields are actually higher on the Coast than in the capital cities,” Mr Riga said.
“This indicates that at present, Sunshine Coast investors are paying substantially less for a higher percentage return on their investment than their counterparts who are investing in the bigger cities.”
Mr Riga said with demand for housing in the region having increased in recent years and new apartment development remaining tight, it was only a matter of time before price growth is registered.
“As more and more projects like the Kawana health precinct, Sunshine Coast Airport expansion and Maroochydore City Centre come out of the ground, it’s inevitable the Sunshine Coast will continue to see demand for housing, prompting both sale prices and rents to rise across the board.”
“Median weekly rents have already increased by 3-5 per cent over the 12 months to March 2015, and there are no signs of this upward trend slowing down anytime soon.”
Reed Property Group Development Manager Josh Peacock said local developers were already seeing hordes of buyers cashing in on affordable stock on the Sunshine Coast, with Stage 4a of the company’s Flame Tree Pocket development having recently sold out within just one week of being released to market.
“The buyer demand we’ve experienced at Flame Tree Pocket over the past 12 months has been unprecedented,” Mr Peacock said.
“The first stage of the development sold out in a record 24 hours and we’ve had to fast-track all three subsequent stages since that time to keep up with demand.”
“The sub-$400,000 price point for house and land packages has proved really attractive to buyers, in particular owner-occupiers who find the house repayments are generally lower than weekly rental costs in the region.”
Mr Peacock said apartments across the Sunshine Coast were also receiving plenty of buyer attention, with the First Light Mooloolaba development already 90 per cent sold.
“Aside from its low price point, I think one of the main things that has attracted investors and owner-occupiers alike to the development is its superb location. First Light is just metres from Mooloolaba Beach and only a short drive from both the Kawana health precinct — where many Sunshine Coast residents will be travelling for work — and the Maroochydore CBD’s entertainment venues, so it ticks a lot of boxes,” Mr Peacock said.
“We’ve found interest has predominantly come from people who are already living on the coast, as well as buyers from other areas of Queensland.”
First Light Mooloolaba consists of 65 architecturally designed two-bedroom apartments starting from $409,000 as well as two penthouses which have both been sold and one commercial space.
Home in blue-chip street sells for $4.1 million
Queensland’s population hits 5 million people today
Queensland’s population has tipped the 5 million mark today, Premier Annastacia Palaszczuk has told State Parliament.
Ms Palaszczuk said several expectant families were on standby to welcome the state’s five-millionth resident.
“Somewhere today a brand new mum and dad will be eager to meet their new arrival,” she told the house.
“The whole family will want to know: is it a boy or is it a girl? And the doctor will say, ‘congratulations, it’s a Queenslander’.”
Ms Palaszczuk said the two main drivers of the increase were migration growth, particularly from New South Wales, and from 60,000 babies being born in the past year.
PHOTO: The state’s five-millionth resident was born today.(ABC North Queensland: Nathalie Fernbach)
“Overseas and interstate migration is up by 50,000 people in the past year, 19,000 came from interstate … more than 12,000, or 230 a week, move from New South Wales to Queensland,” she said.
ABS data also revealed the fastest and largest-growing area in Queensland in 2016-17 was Pimpama on the Gold Coast, which grew by 3,000 people.
Large growth also occurred in Jimboomba on Brisbane’s south side and in North Lakes — a suburb north of the city — which both increased by 2,100 people.
Coomera on the Gold Coast and Springfield Lakes in Ipswich also experienced large growth up 1,400 people.
The State Government’s population counter gives a “synthetic estimate” of the number of current Queenslanders, assuming a total population increase of one person every 6 minutes and 22 seconds.
Earlier this year the Australian Bureau of Statistics (ABS) said Queensland’s population was growing at 1.7 per cent and was projected to tick over to 5 million in May.
ABS data released in March also revealed Brisbane was one of the country’s fastest-growing cities and had increased by 48,000 in 2017, hitting 2.4 million people.
ABS demography director Anthony Grubb said the state’s population had “come a long way” in the last century.
“In 1901 the population was half a million; a tenth of what it is today… it took 37 years to hit the 1 million milestone in 1938 and another 36 years to reach 2 million in 1974,” he said.
But Mr Grubb said population growth “picked up the pace” after that, taking just 18 years to reach 3 million then only another 14 years to hit 4 million in 2006.
Queensland could be leading growth state in future
Population demographer Dr Elin Charles-Edwards said although Queensland is not currently the fastest growing state, it is possible it could top the leader board later down the track.
‘Not in the short-term, but Queensland is coming up off a relatively subdued growth so perhaps we might be entering an era of more rapid growth,” she said.
Dr Charles-Edwards said the challenges that generally come with increased population could be managed in Queensland.
“As long as we keep up and don’t take our eye off the ball we can continue to absorb quite high levels of growth… but really it’s keeping up with the infrastructure that’s the key challenge,” she said.
Dr Charles-Edwards said it was important to note some parts of the state, particularly in western Queensland, were experiencing population decline.
“While the south-east corner is growing and also many Indigenous communities are growing, other parts of the state are shrinking,” she said.
“Perhaps we could do more to encourage people to move outside the south-east corner.
“If we were able to work out some way to decentralise our population, growth a little bit further up into the northern regional centres, I think that would benefit the growth of south-east Queensland.”
APRA to end cap on property investor loan growth
APRA is removing the 10 per cent ‘speed limit’ on investor loan growth.
Photo: Louise Kennerley
The banking regulator is axing a 10 per cent speed limit on bank lending to property investors, saying the cap has served its purpose and improved credit standards.
With Sydney house prices falling and credit growth slowing, the Australian Prudential Regulation Authority on Thursday said it would remove the cap for bank boards that could prove they had been following its guidelines on prudent lending.
In late 2014, amid a surge in borrowing by property investors and rapid house price growth, APRA took the rare step of setting a 10 per cent limit on the annual growth in banks’ housing investor loan portfolios.
The measure has rocked the mortgage market in recent years, prompting banks to jack up interest rates for housing investors, and demand borrowers stump up bigger deposits.
But on Thursday, APRA chairman Wayne Byres said it was prepared to remove the measure because there had been an improvement in lending standards and a slowdown in credit growth.
“The temporary benchmark on investor loan growth has served its purpose. Lending growth has moderated, standards have been lifted and oversight has improved,” Mr Byres
Even so, the regulator will retain a separate 2017 policy that requires banks to limit their new interest-only lending to less than 30 per cent of all new home loan approvals.
APRA also said there was “more to do” in improving other aspects of banks’ lending, including how they assessed borrowers’ expenses, their existing debts, and the approval of loans that fell outside of banks’ formal lending policies.
APRA said it expected banks to introduce limits on the proportion of new lending that could be done at “very high” debt-to-income levels.
“In the current environment, APRA supervisors will continue to closely monitor any changes in lending standards,” Mr Byres said.
“The benchmark on interest-only lending will also continue to apply. APRA will consider the need for further changes to its approach as conditions evolve, in consultation with the other members of the Council of Financial Regulators.”
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