Last week I gave you an overview of the major trends in NSW, the ACT and Regional NSW markets following the release of our 2013 Autumn McGrath Report. This week, we’re focusing on Brisbane and the Gold Coast and I’ll also give you my suburb picks for future price growth.
By John McGrath.
Brisbane
Brisbane is an increasingly aspirational place to live and an important business centre for the country. Flooding issues aside, Brisbane’s strong employment and population growth coupled with a supply shortage and rising rents are driving today’s market recovery.
Buyers lacked confidence in 2012 but sales activity is now improving, so I’m cautiously optimistic on price growth for 2013. Overall, I believe this year will serve as a platform for much stronger growth in 2014/2015.
Upgraders and investors are driving greater sales activity this year. The typical upgrader is swapping a two bedroom workers’ cottage worth $600,000-$800,000 for a $1M-plus Queenslander. There’s not a lot of cross-town moving, as low interest rates and good value prices are enabling people to buy a larger home in inner city areas where they already live.
Meanwhile, investors from both the local area as well as Sydney and Melbourne are filling about half the void left by first home buyers. Investor hot spots include Toowong, St Lucia and Paddington. Investors are also active in thriving regional centres such as Toowoomba, where the proposed jet-capable Wellcamp Airport will bring exceptional benefits.
My top suburb picks
Hawthorne: Has been hugely transformed with new lifestyle amenities, food markets and a local café scene. Very appealing for families, young professionals and renovators.
Toowong: Just 4km from the CBD and less than five minutes to the St Lucia campus, Toowong is an investor hotspot due to high demand from young professionals and students.
West End: A great inner city feel and café culture; also close to the impressive South Bank restaurant precinct. A surge of development is attracting investors and owner-occupiers.
The Gold Coast
The Gold Coast is undoubtedly one of the country’s most exciting markets right now. Sentiment is changing and the bottom of the market appears to have passed, although there is amazing value still available.
There’s greater buyer enquiry across the board, and while prices are still well below their pre-GFC highs, homes are selling in a more reasonable timeframe. We may not see major price growth this year, but we’ll definitely see more sales.
Coverage of the Gold Coast slump has been widespread and this has encouraged a lot of interstate interest among investors and seachangers, particularly from Sydney and Melbourne. Today, about 50% of buyers are from out of area seeking an affordable waterside property or growth investment. Investors usually buy at the lower end – typically apartments, but the opposite is true on the Gold Coast, with investors competing against local upgraders for larger family homes in canal suburbs.
Waterfront houses in the low million dollar range are popular in Isle of Capri, Mermaid Waters, Benowa and Sorrento. The prestige sector is also firing up, with several $5M-plus transactions since November 2012. Notably, last month $9.8 million was achieved for a waterfront home in Southport, selling under the hammer and setting a new suburb record. Just over a week ago, we also sold a waterfront home on the Isle of Capri that fetched $6.35 million, also at auction.
My top suburb picks
Isle of Capri: On the cusp of Surfers Paradise and Broadbeach, you can walk to the beach and live in a beautiful home on the canal. Very popular with upgraders and Sydney retirees.
Labrador/Arundel: On the edge of Southport and serviced by the soon-to-arrive Mass Transit System, this area encompasses the new hospital and expanded university campus and promises massive opportunity for investors.
Tugun: A true ‘insider’s secret’ offering a fantastic family lifestyle, beaches, easy access to Coolangatta and a small community feel. Young families are moving in and renovating beach cottages.
To read the full Autumn 2013 McGrath report visit www.mcgrath.com.au
By John McGrath
