This Week in Real Estate – 26 January 2024
The Week In Real Estate
Gold Coast Records Break
New property price records were set in 11 Gold Coast property markets in the past year.
The biggest sale of the year was the $24.8 million sale of a home known as Alston at Southport. The riverfront home beat the previous Southport record of $23.75m, which it had set when it previously sold in March 2021.
Analysis of sales data shows it wasn’t just the beachfront homes in huge demand with a house in Tallebudgera Valley, breaking the Queensland auction record when it went under the hammer for $11.2m. The previous suburb record was $5.9m.
In Mermaid Waters a home, known as the White House, beat the suburb record by more than $2million when it sold for $7.3m in November. And a home within the Elysee complex at Coolangatta changed hands for $4.035m, well above the previous record of $2.85m.
Gold Coast agent Andrew Bell predicts the Gold Coast will continue to be a standout market in 2024. He says demand remains strong driven by high levels of immigration.
Beach Buyers Out in Force
Buyers are snapping up off-the-plan apartments on the Gold Coast beachfront.
Apartments in Burly Residences, which was launched in September, have sold for a total of $140 million.
Already 38 of its 101 apartments have been sold in the David Devine project which is being built on a 2024sq m site with 40 metres of beach frontage at North Burleigh.
Also achieving strong off-the-plan sales is the tower, Escape at Broadbeach which is being developed by Luxcon Group. Work is expected to start in January on the $250 million tower which will have 31 full-floor residences and two double-level penthouses.
Nine apartments have sold for a total of about $75 million. The strong sales demand resulted in the release of stage two earlier than originally anticipated with further apartments to be released once construction starts.
The 35-level building which will be constructed on Garfield Tce, has 15m of beach frontage and resident facilities including a beachfront pool, surfboard storage, oceanfront business centre and fitness centre.
Unit Rents Surpass Houses
The pace of growth of unit rents is starting to surpass that of houses in many capital cities.
The latest Domain Rent Report shows the combined capital cities median unit and house rent prices both came in at $600 a week, up 20% for units and 9.1% for houses in the past 12 months.
There were five cities that had annual rent increases which were higher for units than houses.
Sydney with a median asking unit rent of $680 per week is up 17.2% while its median house rent rose 12.3% to $730 per week.
Melbourne’s unit rents rose 15.6% to $520 a week, while house rents rose 14.6% to $650.
Brisbane unit rents rose 16.7% to $560 per week and house rents rose 9.1% to $600
Adelaide unit rents rose by 12.5% to $450 per week and houses rose 12% to $560.
Perth unit rents rose by 18.2% to $520 per week and houses rose 17% to $620
Domain chief of research and economics, Dr Nicola Powell, says while the unit market was affordable during the pandemic as people left cities behind that had completely changed in the past year.
First Homebuyers Are Back
Rising rents and tight vacancy rates have resulted in an increase in First Homebuyers, according to Australian Bureau of Statistics figures.
Its latest lending figures show that the number of first-time homebuyers taking out loans increased by 20.3% in the year to November 2023.
ABS head of finance statistics, Mish Tan, says first homebuyer loan commits rose 3.5% during the month of November.
The amount they borrowed to get into the market also rose by 26% in the past 12 months to an average mortgage of $505,000.
It was the more affordable states, that recorded the largest number of first homebuyer commitments, with Queensland leading the pack in November (10.9% increase in the month), followed by Western Australia (4.7%) and South Australia (3.5%).
The ACT did record a 14.2% increase in first homebuyer loans in November 2023, although the ABS says those figures need to take into account that the market is smaller and more volatile than other States or Territories.
Where It’s Hard To Buy
While there are shortages of listings in many parts of Australia, there are suburbs where no matter where it is in the property cycle it can be hard to buy because owners just won’t leave.
According to CoreLogic figures in Sydney, Bonnyrigg Heights is the most tightly held suburb with homeowners keeping their properties for a median of 20.2 years before selling.
Longueville owners stayed put for a median of 17.7 years before selling and in Cabarita in Sydney, they held on for 17.3 years.
In Melbourne, homeowners in Vermont South, in the eastern suburbs, had the longest median hold time of 20.6 years, followed by Caulfield, 20.5 years and Keilor Downs, 19.6 years.
Brisbane homeowners on average were selling their homes after 8.7 years but owners in areas within the western suburbs often kept their properties for twice as long. Middle Park owners stayed put for a median of 19 years while close by in Mount Ommaney it was 18.9 years.
QUOTE OF THE WEEK
PropTrack Senior Economist, Eleanor Creagh
“Conditions in the rental market are unlikely to deteriorate at the same pace as they did in 2022 and 2023, meaning rental prices could stabilise and increase at a slower rate than the past year.”