This Week in Real Estate -17th February 2023
Qld Builds Towards 8,000 Target
The Queensland Government says it is confident it can deliver on its promised 8,000 new social houses within the next four years.
The promise was made after it held an emergency housing summit last year in response to the rental shortage crisis. It committed $2 billion in funding for the creation of more social housing. A development with 42 new social housing units at Windsor was opened this week.
Housing Minister Leeanne Enoch is confident they will complete the promised homes. She says the State Government had a target of starting on 727 homes in the first year of the strategy and it had already exceeded that by starting on 830 homes. The Windsor project, a building with two-bedroom apartments, will house mainly elderly residents and those on a disability pension.
“We’ve been seeing over a long period of time, the changing demographic and more demand for one- and two-bedroom properties, particularly for those who may be older or living with a disability,” Enoch says.
Coast Gears For Tourism Boom
A resurgence in the tourism market is tipped to inject more than $45 billion into the Gold Coast economy within the next ten years, with industry leaders mapping out a plan for the boom.
A strategy on driving tourism into 2032 is to be presented to Gold Coast City Council in coming weeks. According to Destination Gold Coast interim CEO, Karen Bolinger, the big number is achievable, particularly in the lead-up to the Olympic Games in 2032. “Tourism employs more than 44,000 people on the
Gold Coast and 26,000 small businesses around it,” she says.
Bolinger says local operators need to set themselves a deadline of 2028, as that is when the Los Angeles Olympics will close and eyes will start to turn toward Australia to see what it has to offer.
Mayor Tom Tate says with the Gold Coast set to cohost the 2032 Olympics and Paralympics it has a unique opportunity to improve tourism infrastructure in the region.
Quote of the Week
“The ability to work from home has allowed metro workers to continue to seek regional housing, changing the demographic and outlook of house prices in these areas.”
Domain Chief of Research and Economics, Dr Nicola Powell
Lifestyle Property Prices Still Rising
Sea and tree changers are still driving regional property prices up.
The desire for a lifestyle property has not been quenched according to Domain, with its latest figures showing 92% of regional areas recorded a property price rise in the past quarter.
Chief of Research and Economics, Dr Nicola Powell says many regional house prices are still outperforming their city counterparts, in a trend which has been evident for several years.
“The ability to work from home has allowed metro workers to continue to seek regional housing, changing the demographic and outlook of house prices in these areas” she says.
Powell says Regional South Australia had the biggest growth, with values 5.4% higher than the previous quarter.
She says most regional markets have hit their peak and she expects a slowdown in the annual figures. “But many of these regions are unlikely to head back to pre-Covid prices given that the areas are still more affordable than houses in the capitals,” Powell says.
Cashflow Opportunities On The Rise
The opportunity to secure positively-geared residential investments is on the increase as rents rise and prices soften, according to analysis by PropTrack.
PropTrack’s Angus Moore says the huge demand for rental properties has driven up rents substantially which means there are plenty of locations where investors can start earning good weekly returns almost immediately.
Vacancy rates remain at 1% or less in many locations, advertised asking rents have gone up by 7% in the past year, while national home values have dropped 4.5% from their peak in March 2022, according to Moore.
This, he says, is a good opportunity for landlords, particularly in regional areas. “Regional areas often carry higher gross rental yields,” Moore says.
Although he warns some regional markets carry a higher risk of vacancy, but this is not a major concern at the moment with pressures in the market likely to make vacancies tighter this year.
He says investors should choose locations with diverse economies based on multiple major industries.