This Week in Real Estate – 7th July 2023
Progress On 3 GC Stations
Progress is being made on the three new railway stations on Queensland’s Gold Coast.
Recently, the updated designs and onsite works has been stepped up, despite criticism from the LNP that the projects have gotten off to a slow start.
Transport Minister Mark Bailey has defended the Labor Government’s record funding of $2.3 million in this year’s budget for the Gold Coast. He also said there was a sound plan behind the projects and that the design of the station and the obtaining of business cases must come before construction work.
He further noted the hard work on the Pimpama station, and the investigations on the Hope Island and Merrimac stations.
In response to cost blowouts, he concluded that the earlier budget of $120 million had been topped up as planned, with the Morrison government.
GC Mansion Sold For $14.1M
A stunning dream home on Albatross Ave at Mermaid Beach has sold for an incredible $14.1 million.
Built over three stories, the family home of Yatala industrial estate boss Tony Stephens and his stylist wife Alicia sits on a 582sq m lot.
The four-bedroom, four-bathroom abode had been extensively renovated and landscaped since last sold in 2019 for $8.65 million. Marketing agent Amir Mian, of Amir Prestige, said six parties had expressed interest in the contemporary coastal residence and two registered to bid at the auction.
Bidding opened at $13 million and the eventual buyer made an offer of $13.8 million. After just two more bids the property was declared sold.
Albatross Ave is the city’s second-most expensive street behind Hedges Ave, also known as Multimillionaire’s Row.
The median house price on Albatross is $5.4m and on Hedges, $7.5m
Quote Of The Week
“There were a lot of people sitting on their hands last year watching and waiting and expecting that big massive price drop which didn’t happen.”
Ray White Chief Economist Nerida Conisbee on current FOMO in market
FOMO Is Back In Market
The Australian property market is showing strong signs of a rebound with lenders and buyers alike taking advantage of the rising prices.
Data from the Australian Bureau of Statistics show that owner-occupiers and investors drove the surge in June, with respective rises of 4.5% and 6.2%. Experts are attributing this to what is known as ‘FOMO’ (fear of missing out) with buyers wanting to get in before prices continue to rise, citing significant price drops which didn’t occur.
This rise is despite borrowing capacities being cut by a third with the Reserve Bank introducing 12 rises in the past year.
Auction clearance rates have also remained unseasonably strong, with PropTrack recording about 70 per cent of homes selling under the hammer in Sydney and Melbourne.
One factor helping younger buyers is the support coming from their parents, with many willing to support a favourable purchase.
Downsizing Leads To Upsizing
More and more Australians are choosing to downsize in order to upsize their retirement.
Up to 58,000 Australians have taken advantage of the tax-free ‘downsizer’ scheme, selling their principal place of residence and contributing the proceeds to their super. The ATO report showed over the period from July 2018 to April 2023, the overall contribution amounted to $14.5bn, with an average of $250,000 each.
Downsizing a family home to free up extra money for retirement under the downsizer scheme has been around for a few years.
The scheme was recently amended to open eligibility to ages 60 and above. Those interested must meet the ATO’s criteria, such as a minimum of 10 years ownership of the home prior to sale.
It enables Australians to deposit up to $300,000, meaning couples can deposit a total of $600,000. Contributions are separate from non-concessional and attract no tax when money is withdrawn during pension mode.
Rent Freeze Not The Answer
Australia’s 2.2 million real estate investors have been under fire lately, but those who liken all landlords to the devil should be careful what they wish for.
Lumping landlords altogether is just like saying every renter is a tenant from hell who smashes walls and soils bedrooms.
Australia is experiencing a housing crisis and a blanket rent freeze isn’t the answer.
The majority of landlords are trying to do the right thing; covering the rising costs of servicing their loans and fostering long term tenancy agreements. Some have even reduced rent or gone beyond to support tenants during the pandemic.
The Greens’ have recently called for “a two-year emergency rent freeze”. The Greens proposal could be disastrous for investors if they can’t keep up with their large mortgages, leading to fewer properties available for rent.
Good landlords with heart should be praised over those trying to get rich quick.