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Opinion

What a year 2016 proved to be

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Lloyd Edwards, Ray White Buderim

The start of 2016 was seen by many as the year of the sold sign. It seemed like they were everywhere. As quickly as the for sale sign went up they were quickly swamped by a sold sticker. Of course the vast majority of homes sold, were within reach of the average buyers but where were the high end buyers? They were waiting, weighting up the market before pouncing in the second half of the year. Twelve sales over $1million dollars in my marketing place of Buderim in the last three months of 2016 as an example. So what will 2017 be known as for the high end?

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The signs are there that this coming year will be defined by supply with huge numbers of buyers through open homes and only limited property numbers to consider. Definite signs of high demand and short supply has meant that sellers are now showing their confidence with truly special high-end properties coming to the market. Properties like 15 St. Martins Tce in Buderim; possibly one of the biggest and best residences I have seen in my real estate career. The quality of the finish, the volume and that ocean view over an elevated pool means the owner had to pick the right time to market and that time they decided is now. Is this the start of the high end recovery or has it already started in the middle of 2016? Either way 2017 is going to be driven by supply.

Other factors will also reduce supply in the high end. Take the acreage areas around Jorl Crt, Buderim, where re-development has meant that acreage homes have become townhouses close to the University. If you want acreage close to the private schools, then your possible selection has been reduced by up to 40% in recent years. Again this will add pressure to an already tight marketplace.

This pressure will continue over the next few years as the population growth driven into the area by large projects like the SCU Hospital, Aura, Palmview, Sunshine Plaza and the airport expansions. Blocks will get smaller, home builders will get smarter design but the high end buyer will be always be here, their choices will be limited and there is an opportunity here for the astute seller to capitialise on this part of the cycle. And so 2017 has to have the title of the year of high end opportunity.

Grant Smith, principal Century 21 Grant Smith Property

In 2016 Century 21 Grant Smith Property marketed a number of properties that were incomplete or required extensive work to make them habitable.

“It was extremely interesting to market these homes,” director Grant Smith said. “As they are uninhabitable it posed potential issues for financing and insuring the properties.

“These properties are difficult to price position due to lack of comparable data so we utilised the same formula on all three sales. This was to publically auction all three with no conditional offers accepted prior to.

“Each property attracted far more interest than our standard properties for sale, this ultimately draws down to the fact that each property in its own merit was an opportunity for the right buyer.”

Spurred along with strong campaigns, each property attracted between six and 14 registered bidders, an exceptional number of cash buyers in any market.

All three sold above their reserve prices which were set based on market and buyer feedback. All successful buyers were locals and they came from various sources, with print proving beneficial.

“The termite house, deemed uninhabitable by the insurance company and likely to be knocked down was purchased by local builder Muir Developments and has been completely renovated and extended, with all damage repaired.

“The unfinished dream home in Tommys Ct, Buderim, sold $50,000 above reserve by Russell Dell from our new projects division. The buyer intends to finish the dream as a project as does the purchaser of Dakara Ct, an unfinished Balinese renovation.

“Properties sitting outside the box require creative marketing and the right agent, and the flow on last year saw Century21 sell a few of these homes with overflows of buyers, and a surprising volume of new buyers.

“Our experience shows that with the cost of building, buyers are excited by the opportunities of an unfinished property. We may see a few of these properties come back to market, however surprisingly it was, the investors won out in all three auctions.”

Amber Werchon, director Amber Werchon Property

2016 was an extremely positive year for the Sunshine Coast property market. In a review of land sales it is clear there has been increased interest and record sales in the prestigious land market; for example, waterfront development; ‘Entrance Island’.

These level half acre blocks located in a private and secure gated community bring a whole new meaning to waterfront living on the Sunshine Coast.

Achieving an average sale price of more than $1m per block, reflects the dramatic increase in buyer confidence, that has been driven by the positive economic conditions on the Sunshine Coast and the impact of the large infrastructure projects currently underway.

These include the $1.8 billion Sunshine Coast University Hospital (only 700m from Entrance Island itself), surrounding health hub and Oceanside development, Maroochydore Town Centre and the proposed redevelopment of Maroochydore Airport.

Buyers are in awe of the lifestyle that Entrance Island provides with it’s prime location and a once in a lifetime opportunity to own level waterfront land within walking distance of the beach and one of the largest health hubs of the southern hemisphere.

With the Sunshine Coast University Hospital nearing completion and employing a total of 6,500 staff, we have seen a number of the Entrance Island blocks sold to health professionals moving to the area from Brisbane, North Queensland, Sydney and New Zealand. However, initially local buyers were attracted to the physical size of these level half acre lots starting at 2000sqm and the surrounding walkways, parks, bike-ways and recreational facilities, along with the lake where families can safely swim, sail, kayak, and enjoy all that coastal living has to offer!

With 17 original lots, only three remain.

While many purchasers have seen the potential for huge capital gain in such a prestigious development, and some are holding their blocks as an investment, construction is now underway on four lots allowing people to visualise their ideal lifestyle on Entrance Island. There has already been one re-sale on the Island which was a recent record sale for Birtinya waterfront.

According to the latest REIQ Quarterly Market Report, the Sunshine Coast has now been identified as one of the state’s key growth regions, with significant ongoing infrastructure projects injecting money into the local economy and creating employment opportunities; 2017 is shaping up to be an even better year.

Vicki Stewart, principal Stewart Property

Kawana Island, right in the heart of the Sunshine Coast, has become one of our favourite areas to sell.

We have made some long-term friendships with both our buyers and sellers. What a fabulous part of the Coast to retire to or bring up your family.

We first began our association with Kawana Island when a well-known developer approached our office looking for help to move some apartments he’d had on the market for some time.

Utilising our in-house data base of qualified buyers as well as using print media and internet marketing, we had his properties sold in no time.

Since then he has come back to us again and again, and thanks to our success, other sellers have appointed us to sell their homes, and the ball is still rolling. Kawana Island has been a huge success story for us.

Homes on Kawana Island attract a lot of activity, and continue to sell well. Homes offering 4bed,2bath,2car, sell from $650,000 plus and stock levels are very low, resulting in the ‘days on market’ becoming less and less. In fact a good home, well presented and well-priced can sell within a fortnight.

Where we have seen the major activity has been in the apartment sales with some record prices being set.

To give you an example, in that time frame, we have sold

ST. KITTS DOUBLE BAY: We have had 23 units sales ranging in prices from $490,000 through to $1m and we’ve seen prices increase in that time by around 20%.

A majority of buyers are owner occupiers, as opposed to investors, which has been interesting, as they all offer 3,2,2, and a majority are waterfront.

LEEWARD APARTMENTS: We’ve completed seven sales, mostly to investors, ranging from $400,000 to $550,000.

We are seeing prices rise in Leward, more slowly, but in the right direction.

OCEAN REACH APARTMENTS: It’ss just coming into its own, the grounds are incredible and we are seeing more activity than ever, and when you consider you can buy a spacious 3,2,2 apartment on the water for the low to mid $500,000s you can understand why.

AZURE: Flourishing in the investor market with prices rising, sales in this complex range from $315,000 for 2,2, with a spacious balcony through to $510,000 for a townhouse with private courtyard.

ISLAND QUAYS: Popular with owner occupiers and investors, we’ve completed seven sales here with prices from $480,000 to $600,000 for a 3,2 waterfront apartment.

The facilities feature a tennis court and pools. The complex is also pet friendly so you can see why this complex is so popular.

In total, in that time frame, we have sold over $25m worth of stock, just in apartments, and are currently negotiating three more.

Kawana Island is well worth looking at as your preferred part of the Sunshine Coast for living the perfect coastal lifestyle.

Greg Clarke of Ray White Mooloolaba

Unit properties on the Sunshine Coast in good locations are realising a resurgence in popularity compared to the previous four years.

Building appeal, location, views, and lifestyle are important factors for the genuine buyer.

Reducing the number of safe options for overseas holidaying and the lower value of the Aussie dollar, many people choose the Sunshine Coast as a holiday destination with not only the safety aspect, but also value for money. Resort managements are seeing strong growth and returns for their owners.

Increased interest and subsequent sales in the unit market shows an increase of between 5% and 10% in volume and price.

I’ve recently sold six units in Sebel, Maroochydore from $510,000 for a 2,2,1, through to $700,000 for a 2,2,2, penthouse.

Three units in Aqua Vista sold for between $645,000 and $865,000 a piece.

While we’ve seen less than satisfactory results in the past, we now view a positive forecast with the number and value of recent sales in buildings such as the Sebel and Aqua Vista.

I currently have a rarely opportunity to purchase a penthouse with private rooftop deck and spa. High occupancy rates for those looking for an investment property are evident, with the unit unavailable for an inspection until January 14 due to holiday bookings.

 

Originally Published: http://www.ipswichadvertiser.com.au/

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Opinion

How much does it cost to buy property at Australia’s best beaches?

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How much does it cost to buy property at Australia’s best beaches

Winter is coming, the property market is cooling and hot summer days spent at the beach are becoming a distant memory.

But dreams of a sea change could still keep you warm for months to come and looking to one of Australia’s coastal markets now could have you sitting beachside by summer.

The location of that home and beach will depend on your budget. Here’s what it now costs to buy in some of Australia’s top beach locations.

$2 million+

If you’ve got serious cash to splash, then real estate by Sydney’s Bondi Beach — arguably Australia’s most famous strip of coast — could be within your reach.

With a median house price of $2.675 million and a median unit price of $1.2 million, buying into the beachside suburb does not come cheaply, but it’s more affordable than Sydney’s other top beach contender – Manly.

How much does it cost to buy property at Australia’s best beaches 1

While house prices in the northern beaches gem dropped 11.5 per cent in the year to March, according to Domain data, the median house price still sits at $2.955 million. Meanwhile, the median unit price dropped 3.7 per cent to $1.315 million.

If Sydney’s not your cup of tea, you can cast your gaze west, far west to the other side of the country, where you’ll find the turquoise water and white sand of Perth’s Cottesloe Beach.

Despite  Perth’s market downturn – house prices are down 14 per cent and units down 16.6 per cent from the 2014 peak – Cotto will still set you back a pretty penny, with a $2,147,500 median house price. Units are more affordable with a median of $780,000.

How much does it cost to buy property at Australia’s best beaches 2

$1 million+

Northern NSW and south-east Queensland offer up the top rated beaches in Australia for those looking to spend about $1.5 million or less.

Byron Bay, Noosa and Surfers Paradise have long been favoured spots for holidaymakers and are increasingly attracting people looking to make their favourite vacation spot their hometown.

While about half the out-of-towners snapping up real estate in popular Byron Bay were once only looking for a holiday home, that’s no longer the case,  said Ian Daniels of McGrath Byron Bay

“Half the houses were holiday houses before, now you can see how many more people are living here,” Mr Daniels said.

How much does it cost to buy property at Australia’s best beaches 3

Byron Bay has the highest median house price of the three at $1,562,500. It’s followed by Surfers Paradise and Noosa Heads, with respective medians of $1.55 million and $1.145 million. Meanwhile, the median unit price is $850,000 in Byron Bay, $890,000 in Noosa Heads and $380,000 in Surfers Paradise.

Mr Daniels said there had been “no let up” during cooler winter months in recent years, but noted buyer demand could be a little weaker this year due to the broader property market downturn.

While there tended to be less stock in winter, Mr Daniels said, it could be a great time for both vendors and buyers to be on the market because there was less competition.

How much does it cost to buy property at Australia’s best beaches 4

$750,000+

The Sunshine Coast and Gold Coast are again the best beachside bet for buyers in this price range, with Burleigh Heads and Mooloolaba offering house prices of $865,000 and $837,500. Unit medians sit at $535,000 and $424,750.

While investor activity has dropped off, Josh Willatt of Ray White Robina said, there is still good demand from locals and buyers looking to make a sea change.

“We’re still seeing buyers come up here in droves from Sydney and Melbourne … and we also see good inquiry from Brisbane, ” Mr Willatt said, adding they were drawn to the area for its great beaches, strong village atmosphere, restaurants and cafes.

How much does it cost to buy property at Australia’s best beaches 5

Mr Willatt said the Gold Coast and south-east Queensland was still extremely affordable for what it offered. He noted buyers had more choice in late winter and spring as more stock hit the market, but that there was still a steady stream of buyers over the cooler months as the market was less seasonal than others.

$500,000 or less

Buyers who want to purchase near a well-known beach for less than $500,000 should cast the net wide, looking to Broome,  Darwin and Victoria’s Phillip Island. However, swimming year round won’t be an option, due to cold temperatures in some cases and box jellyfish in others.

For $494,500 you can buy a house by Cable Beach in Broome, or an apartment for a little under $300,000.

Apartments near the famous Mindil Beach Sunset Markets in Darwin have a median of about $380,000 as do units in the suburb of Cowes, near Kitty Miller Bay on Phillip Island.

How much does it cost to buy property at Australia’s best beaches 6

Michael McLeod of First National Phillip Island said those looking to buy on the island might be best doing so in winter.

“[Island living] is not all glamour, there is rain,” Mr McLeod said. “We’re still quite consistent in winter, [but] there’s fewer people around and [buyers] have the time to make decisions.”

“The time a property is on the market [varies greatly] … when it’s extremely busy places can be snapped up … or we have things that can take two years or a year to sell,” Mr McLeod said.

While retirees cashing out of Melbourne still make up a bulk of the population, Mr McLeod said, a growing number of younger families were moving to the area and commuting to Melbourne or working remotely.

Source: goldcoastinvestor.com.au

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Opinion

How good an investment is south-east Queensland

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How good an investment is south-east Queensland

Why do we believe we’ll see increasing investor interest in this market? Strong population growth, a diversified and growing economy, and substantial investment in infrastructure should combine to boost demand.

We expect that these factors will swell the number of white-collar jobs – increasing demand for office space, which in turn will push down vacancy rates and raise rental incomes. This should be good news for office property investors – especially those like Centuria Metropolitan REIT (CMA) that are already well-positioned in the market.

A significant and growing population

South East Queensland (SEQ) stretches from the Gold Coast up to the Sunshine Coast and across to Toowoomba in the west. As Australia’s third-largest population zone, the region has been growing significantly, particularly Brisbane and the Gold Coast. Interstate migration figures show a pattern of steady net migration, with Queensland the only Australian state with consistent net inflows of people from other states. In the five years prior to the 2016 Census, over 220,000 people moved to the Sunshine State – mainly to SEQ where nearly 90% of population growth occurred. This is important for property investors because of its implications for demand, but the trend is interconnected with other favourable factors.

A diversified economy poised for growth

Queensland’s economy is diversified across a range of industries including agriculture, resources, construction, tourism, manufacturing, and services. Over the past two decades, its economic growth has consistently exceeded the national average – and in our view this is likely to continue.

The resources sector is gaining momentum, and a significant pipeline of major infrastructure and development projects is helping propel economic and jobs growth, in turn increasing interstate migration and driving demand for both residential and commercial property.

Investment in infrastructure

A strong infrastructure program delivers more than business and consumer amenity – it generates jobs, drives investment, and facilitates population growth. The pipeline of infrastructure and development projects announced in the past few years is likely to have a material impact on the region – substantially improving its accessibility and amenity – most notably, Brisbane’s Queen’s Wharf precinct and the Cross River Rail.

Queen’s Wharf, touted as a “world-class entertainment precinct”, is an integrated resort development costing $3.6 billion and covering over 26 hectares with retail, dining, hotel and entertainment spaces. As Queensland’s biggest ever tourism project it will be a game-changer for Brisbane, attracting overseas as well as local visitors.  Estimated to contribute $1.69 billion annually to the economy, it will employ more than 2,000 people during construction and an estimated 10,000 once operational.

The Queensland Government’s number one infrastructure project, the $5.4 billion Cross River Rail, comprises a new 10.2km rail line between Dutton Park and Bowen Hills, which includes a 5.9km tunnel under the Brisbane River and CBD. It’s the first major rail infrastructure investment in the inner city since 1986 and is set to generate urban renewal, economic development and the revitalisation of inner-city precincts.

Outlook for commercial office property investment

These factors indicate a region poised for growth – and for growing commercial property demand. CMA’s portfolio has a significant exposure to the area in general (six SEQ assets with a combined book value of over $480 million), with many of the individual assets located in those parts of Brisbane set to benefit most from these developments.

Our view is that Brisbane office markets, where five of CMA’s assets sit, are continuing to improve, with vacancies hitting a five-year low – indicating increasing tenant demand – and continued yield compression, demonstrating strong investment demand. Office sales hit the highest level in a decade during 2018 (at $2.35 billion), increasing 60% from 2017.

With the strong outlook for SEQ, we expect the region will continue to attract tenants and investors alike.

Source: brisbaneinvestor.com.au

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Opinion

Queensland’s 100,000-property public housing shortfall revealed

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Queensland's 100,000-property public housing shortfall revealed

Queensland has a severe shortage of social and affordable housing, an issue that is projected to get worse by 2036 according to new research.

More than 102,000 additional social houses are currently needed across the state, and 54,700 affordable houses are also needed with nearly 13 per cent of Queenslanders spending more than 30 per cent of their income on rent.

By 2036, Queensland is projected to need 254,300 more social and affordable houses – the second-highest unmet need behind NSW, the report found.

The new figures come from a UNSW City Futures Research Centre report on social housing shortfall across Australia.

Regional social housing shortfalls are higher than in Brisbane, the data shows, but Brisbane residents are slightly more likely to be spending more of their income on rent.

Housing Minister Mick de Brenni said housing affordability was a “big issue” for Queensland.

“Through the Palaszczuk government’s $1.8 billion Queensland Housing Strategy, Labor is driving key reforms and targeted investment across the housing continuum,” he said.

“The Strategy commits us to build more than 1000 affordable homes for Queenslanders, as well as a further 4522 new social homes to help ensure everyone has a safe, secure and stable place to live.”

Lead researcher Laurence Troy said 22.5 per cent of Australia’s entire housing growth must go to social housing to meet demand into the future.

“Our analysis shows that the sheer number of households in rental stress across the country means that if we’re going to meet the need, at least 12 per cent of all our housing by 2036 will need to be social and affordable housing – which is a very reasonable ambition in global terms,” Mr Troy said.

“To cover the backlog of unmet need and future need in Australia two in 10 new homes will need to be for social housing over the next 20 years, and a further one in ten for below-market affordable rental housing.”

Mr Troy said the research’s financial modelling found the “best and cheapest way” for governments to meet the need for social housing was to fund it through upfront grants and low-interest government financing.

“Delivering below market rental housing through the not-for-profit sector, as opposed to the private equity model, will save $3 billion a year by removing developer mark-ups and shareholder returns,” he said.

The financial modelling was commissioned by the NSW community housing sector.

Mr de Brenni said the state government was “listening” through its recent public consultation on rental reform and was committed to investing in affordable housing in partnership with community housing, to provide more subsidied homes for low income earners.

“We heard Queenslanders are struggling to afford rental properties in the suburbs close to where they work,” he said.

“Through our Build-to-Rent pilot project, we are seeking to work with the private sector to increase the number of long-term, affordable rental properties for low to moderate income earners, including key workers in health, early childhood and hospitality.

“Internationally, the Build-to-Rent model is delivering fantastic outcomes and facilities for tenants and we’re looking to see what the market is open to delivering here.

“The pilot, if it proceeds, will see $70 million invested towards delivery of hundreds of affordable rental properties for key workers in inner-city areas where affordability has been identified.”

Mr de Brenni said the registrations of interest for that pilot had seen strong market interest, and the department was considering the responses before calling for expressions of interest.

Source: brisbaneinvestor.com.au

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