This Week in Real Estate – 25th May 2023
GC To Lose Planning Powers
Gold Coast councillors warn proposed changes to planning regulations could mean they no longer have the power to approve or reject housing development applications in the region.
They say changes to the Planning Act and Planning Regulations will give developers the ability to lodge plans over which they will have little input.
Gold Coast City planning head Cr Cameron Caldwell has labelled the changes untested and risky.
Under the new state government system, dwellings will no longer be classified as assessable developments but will be classified as “building works”.
There are some fears this means they will be “rubber stamped” with the council planning committee no longer able to properly assess them.
“We are concerned of the unintended consequences in suburban Gold Coast where a detailed assessment of non-City Plan compliant dwellings will now not occur,” Cr Caldwell says.
“More concerning is neighbouring properties are now cut out of the process, meaning no visibility about what might happen in your backyard.”
Quote Of The Week
“Units are becoming more attractive as buyers make compromises over space for location.”
Cate Bakos – President of the Real Estate Buyers Association Australia
Property Wealth Doubles
The property boom is set to deliver millionaire status to many more Australians within the next five years.
We are set to create 1.5m more millionaires in the next five years, according to the latest update to Knight Frank’s Wealth Report.
It says after a short period of decline, property values across the country have bounced back, boosting the wealth levels of owners.
Knight Frank head of residential research Australia, Michelle Ciesielski, says a large contributor to the top one per cent wealth level doubling in Australia over the past two years has been prime residential property performance.
She says it has been resilient despite the rising cost of finance.
The report says Australia’s wealthy populations are set to achieve further growth in the next five years.
It says the number of high net worth individuals, those with more than $1.5m, will grow by 71.1%.
Growth of the wealth of high net worth individuals is growing at 2.5 times the pace it was over the previous five years since 2017.
Houses Or Units?
Units are once again becoming an appealing investment option according to the President of the Real Estate Buyers Association Australia.
Cate Bakos, says the rising cost of credit and the fact that affordable housing is now well outside of CBDs, meant that units are in the sights of investors again.
She says the reduction in spending capacity is having a direct impact on consumer choices, as interest rates soar and limit the budgets of property buyers and investors, forcing them to look toward the unit market.
“Units are becoming more attractive as buyers make compromises over space for location,” she says.
Bakos says household sizes have reduced in recent years as well, leading to more demand for smaller units.
She says while Covid created a spike in demand for houses, more generally shrinking average household sizes are more conducive to apartment living than in previous decades.
Also, according to Bakos the ratio between house and unit prices has widened, making apartments a more affordable option.
Property Wealth Doubles
The property boom is set to deliver millionaire status to many more Australians within the next five years.
We are set to create 1.5m more millionaires in the next five years, according to the latest update to Knight Frank’s Wealth Report.
It says after a short period of decline, property values across the country have bounced back, boosting the wealth levels of owners.
Knight Frank head of residential research Australia, Michelle Ciesielski, says a large contributor to the top one per cent wealth level doubling in Australia over the past two years has been prime residential property performance.
She says it has been resilient despite the rising cost of finance.
The report says Australia’s wealthy populations are set to achieve further growth in the next five years.
It says the number of high net worth individuals, those with more than $1.5m, will grow by 71.1%.
Growth of the wealth of high net worth individuals is growing at 2.5 times the pace it was over the previous five years since 2017.
Houses Or Units?
Units are once again becoming an appealing investment option according to the President of the Real Estate Buyers Association Australia.
Cate Bakos, says the rising cost of credit and the fact that affordable housing is now well outside of CBDs, meant that units are in the sights of investors again.
She says the reduction in spending capacity is having a direct impact on consumer choices, as interest rates soar and limit the budgets of property buyers and investors, forcing them to look toward the unit market.
“Units are becoming more attractive as buyers make compromises over space for location,” she says.
Bakos says household sizes have reduced in recent years as well, leading to more demand for smaller units.
She says while Covid created a spike in demand for houses, more generally shrinking average household sizes are more conducive to apartment living than in previous decades.
Also, according to Bakos the ratio between house and unit prices has widened, making apartments a more affordable option.
Australian Population To Explode
Australia’s population is tipped to grow by 13.8% between 2021 and 2030, according to a report from global real estate firm, CBRE.
It says the surge in population, which will be driven in part by migration, will increase demand for all types of real estate including residential, commercial, office and industrial.
This demand will lead to higher rents for all property classes.
The report says population growth is one of the biggest drivers of vacancy and rental growth in both commercial and residential property and that with Australia having the second highest population growth rates of the developed world means prices will increase.
“This will drive significant demand for housing,” the report says.
The current rate of population growth is equivalent to adding an additional 4.43 million people to the population.
Analysts believe this surge in population at a time when supply of new housing is low, will lead to overcrowded housing, soaring rents and increasing homelessness.
