A sea-change surge has pushed the Gold Coast and Sunshine Coast rental markets to the brink of breaking with median weekly prices soaring to record heights as industry experts warn the boom that’s left some locals homeless is far from over.
According to the latest Domain Rent Report, both cities recorded their strongest annual growth on record over the year to June, with median house rents now an eye-watering $600 per week in each hub.
Over the June quarter, vacancy rates also plummeted to their lowest in history – a painfully tight 0.4 per cent in both – creating the most severe rental conditions in the country amid reports some businesses are battling to find hospitality and retail workers due to the lack of housing.
Domain chief of research and economics Nicola Powell said that while soaring prices spelled good news for landlords and investors, there was no end in sight for struggling tenants with local wages growth unlikely to support ongoing rent hikes for much longer.
“I think it will get to a point where the rate of rent growth (in both cities) is unsustainable against the backdrop of weekly wages growth and there’s only so long tenants can withstand it. [House rents are] up $100 on the Sunshine Coast and $90 on the Gold Coast. Sunshine Coast unit rents have surged $75 over the past year to a median of $495 a week, while the Gold Coast median unit rent is $55 higher to $485,” Dr Powell said.
“Landlords are clearly cashing in on improved household budgets and increased interstate demand to boost yields … however it does put tenants in a vulnerable position.”
While both cities are no strangers to booms and busts, Dr Powell said the current rental market surge was faster and more furious than any previous ebbs and flows on the Gold Coast and Sunshine Coast, with every new lockdown in the nation’s major southern cities only fuelling the sea-change fire.
“Interstate migration is a big part of the rent rise … and anyone moving from interstate – if they are remote working and keeping a higher paid job – might have more cash to spend on rent, so it’s likely that bidding wars happening right now,” Dr Powell said.
“The other point is that the vacancy rate is tightening … with both of them edging to zero … so conditions are extraordinarily tight compared to other capitals.”
On the Sunshine Coast, Sunshine Beach Real Estate principal Pip Covell said the trickle-down effect of the rental crisis was being felt across the city.
“People are now prepared to pay six or even 12 months of their rent in advance … everyone wants to live here because they have realised they don’t have to live in the big smoke anymore,” Ms Covell said.
“And I think it’s going to continue … but it’s a pity for the locals here. Even businesses can’t get people to work in the hospitality trade because those workers cannot find places to live. The younger ones are being forced further out so this has a real roll-on effect.
“I don’t know what is going to happen … and rentals are popular right across the board. For most people, it’s a case of just finding a home wherever they can.”
While Ms Covell said demand slightly eased across the city’s rental market over the past quarter, she also conceded it was because there simply wasn’t any stock left.
“If you don’t have the goods, you don’t get the inquiry,” she said. “And we’re running on nothing.”
On the Gold Coast, Ray White Surfers Paradise Group property management general manager, Amber Roberts, echoed the sentiment and said the boom on their end was being exacerbated by the fact rental prices on the coast had remained steady for years.
“I have never seen this level of inquiry before … we’re still averaging 10,000 inquiries a month. It was almost like someone pushed the ‘go’ button and everyone said ‘we’re all moving to Queensland’,” Ms Roberts said.
“So, we are in a bit of a crisis. We need more stock and we need more investors … in fact, it’s such a good opportunity for investors right now as it’s really hard to be negatively gearing a property. That gap has even closed at the prestige end,” Ms Roberts said.
“I just listed a property that was being rented for $1100 a week in Sanctuary Cove – on the water – and I relisted it for $1800. I already have multiple people interested.
While Ms Roberts said it was indeed a tough rental climate for locals, she felt the coastal city had been as cheap as chips for years with prices still considerably higher in Melbourne and Sydney’s seaside hot spots.
“We were spoiled for too long … and while the Global Financial Crisis didn’t hit us as hard [as it hit some cities], it went for longer and I think there hasn’t been a huge amount of capital growth in property … so, I’m excited for investors to be finally seeing a return,” she said.
“And to be honest, anything we list at the moment is hot. There’s not a suburb that isn’t performing … and I think that’s because of the last lockdown. There were people on the fence about making the move here because Melbourne came out of having restrictions and it was the same with Sydney. But then it all happened so quickly again and there are a lot of people who are done with it down there now.
“I think we will see another wave and then there will be the international market and students who return.”
But while Ms Roberts is convinced there are enough market factors to keep the rental boom burning, she admitted the tight stock levels were crippling.
“Our vacancy rate is 0.2 per cent … and that’s a record for us. And this just feels like it has become the new normal.”
According to the Domain Rent Report, houses in the Gold Coast suburb of Southport recorded the biggest quarterly jump in the median weekly rent of 9.1 per cent to $600, while on the Sunshine Coast, houses in the Noosa Hinterland were the clear winners after a 7.8 per cent quarterly hike sent the median weekly rent to $620.
Article Source: www.domain.com.au
Gladstone prestige market activity at rock bottom: HTW
The prestige market in Gladstone has been very thinly traded over the course of 2020, according to the November report from Herron Todd White.
In 2019, we saw two sales occur above $1 million. In 2020, the highest sale to date has been a rural residential property in Wurdong Heights for $840,000. This 6.32-hectare property is located on an elevated allotment with 270-degree panoramic views (east to the Boyne River, south to Many Peak Ranges and north overlooking natural bushland).
The dwelling itself was a mid 1990s four-bedroom, two-bathroom residence with extensive outdoor areas to take advantage of the views. Other features include shed space, golf buggy with built in charging station and a concrete cyclone bunker built into the side of a cliff.
Another prestige property in the dress circle location of Parksville Estate in New Auckland that has recently gone under contract. HTW are unable to disclose the purchase price at the time of writing, however can advise that the asking price was $889,000 and the purchase price was very close to the asking price. The property comprises a large, high quality home with all expected features plus sheds, a pool and spa on a 5,422 square metre near level, extensively landscaped lot.
This location is very sought after. Two vacant allotments recently sold for around $300,000 each in this estate.Also located in the estate is 2 Parksville Drive which we mentioned in last year’s prestige issue when it sold for $1.04 million.
There are currently about a dozen properties in the region listed for sale above $1 million. Most are rural residential properties, however a couple are large, modern, inner city dwellings that take advantage of amazing harbour views.
Article Source: propertyobserver.com.au
Gladstone delivers double energy boost with green light for gas, solar projects
Central Queensland’s energy sector has been boosted with a gas joint venture awarded two petroleum leases and a planned $350 million solar farm near Gladstone farm winning backing from a UK investment and venture capital group.
The Mahalo gas joint venture between Comet Ridge, Santos and APLNG, was granted two, 30-year leases allowing it to move into production.
Comet Ridge chairman James McKay said the granting of the leases followed years of exploration, appraisal and development planning activities to prove up Mahalo, west of Gladstone, as a valuable development-ready gas project.
He said the project now has full regulatory approval to enable the project to realise full value for the asset.
‘’The Mahalo Gas Project is well positioned to deliver meaningful gas production into the domestic and export market as part of an emerging greater Mahalo fairway,” Mackay said.
A final investment decision has yet to be made.
The approvals coincided with United Green taking a majority stake in the Rodds Bay solar farm from Renew Estate, a joint venture between Energy Estate, Beast Solutions and global solar operator WIRSOL Energy.
The 300 megawatt project, 50 kilometres south of Gladstone, would be one of Australia’s largest renewables projects and add to the 6600MW of operational and committed renewable energy generation capacity.
If the project moves to development it would create more than 300 construction jobs.
Premier Annastacia Palaszczuk announced the deal this morning and said the equity investment from United Green was a vote of confidence in Queensland’s renewables sector and the state’s economic recovery.
“While there are still some steps for this project to follow, this major investment will mean hundreds of new jobs in the Gladstone region when the project is due to start later this year,” she said.
Gladstone has also been marked as a potential hub for hydrogen production.
“With hydrogen the sky’s the limit,” Palaszczuk said.
The solar deal was a first for United Green in the Australian energy market. It also has investments utility-scale wind and solar developments in Europe, Asia and the Middle East.
Renew Estate director Vincent Dwyer said the Rodds Bay project was a commitment to a sustainable future for the Gladstone region.
“We are delighted to have secured such a capable and experienced partner in United Green, with a shared vision for Queensland as a renewable energy powerhouse,” Dwyer said.
“Rodds Bay will not only create direct employment through jobs on site, but will create major opportunities for suppliers across a range of areas.
“We worked closely with Trade and Investment Queensland (TIQ) to secure the investment, and we are very grateful to TIQ for their introductions and support.
“We’re also continuing to work closely with them to connect into local supply chains as part of delivering jobs and regional economic development.”
United Green Chief Investment Officer Tim Mole also welcomed the move. United Green has investments across energy, real estate, technology, nutrition and trade.
“The strength of support for this project from the Queensland Government, the local community, local businesses and other stakeholders gives us great confidence in taking this project forward to construction and marks Renew Estate as one of Australia’s leading renewable energy developers,” Mole said.
Renew Estate will continue to be a shareholder in the Rodds Bay project.
This article is republished from inqld.com.au under a Creative Commons license. Read the original article.
Gladstone sees limited renovation activities: HTW residential
There has been little change in regard to COVID-19’s impact on Gladstone’s property market, according to the latest Herron Todd White (HTW) residential report.
The valuation firm suggests in locations across the nation, the downtime delivered by isolation has spurned on owners looking to improve their assets through maintenance and upgrade.
This month’s HTW report highlights where renovations are on the rise and the price points and outcomes those markets can expect.
“It’s just about business as usual for our market. Sales continue to tick over with no evidence of any further declines in value,” the valuation firm said.
The HTW report notes rental vacancies remain tight with a vacancy rate of 1.6%, the lowest they have been since the peak of the market.
Affordability is still the key driver in our market and while we are not out of the woods just yet, it’s looking more and more likely that COVID-19 will be remembered as just a very minor blip on the radar for Gladstone’s residential market.
In terms of renovations, there has really been very limited activity in the past 12 months, apart from every man and his dog doing minor maintenance or landscaping work during lockdown, the report noted.
The reason for the lack of renovation work is really unknown. Despite the market looking up, a significant portion of homeowners in Gladstone would have negative equity in their homes from the market downturn, so in essence cannot afford to renovate.
“We’ve seen the odd, full internal renovation, in most cases of a mortgagee sale property that is in a state of disrepair and that sold towards the bottom of the market range.Completing only minor cosmetic works to these types of properties adds considerable value to the property,” the valuation firm dais.
While not quite considered a renovation, construction of new sheds on existing properties has surged over the past several months.
“The reasoning behind this sudden increase in sheds being built is also unknown. Interestingly, the size of the sheds is also increasing,” the valuation firm said.
Once upon a time, a six metre by six metre shed in the back yard was the norm, however this is no longer the case. Longer and wider sheds with higher clearance are becoming the norm along with features such as mezzanines and internal bathrooms.
“We have also noticed a distinct uplift in pricing for sheds in the region. Costs appear to have jumped about $100 per square metre in the past few months and this sudden jump in cost has not yet been reciprocated in the added value of a shed to a property.”
An original three bedroom home in West Stowe with a renovated kitchen has recently been sold for $278,000.
The four bedroom, one bathroom house is situated at 1130 Calliope River Road (pictured below).
It features hardwood timber floors, three bay shed and mountain views.
The property was last sold in 2012 for $60,000.
A new listing is a renovated home in Sun Valley priced at $179,000.
The three bedroom, one bathroom house is situated at 2 Franmaur Street (pictured below).
It comes with three bedrooms, lounge and dining areas, functional kitchen and covered entertainment area.
This article is republished from www.propertyobserver.com.au under a Creative Commons license. Read the original article.
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