Noosa the new leader for house price growth

10/09/2018

NOOSA, on the Sunshine Coast, has delivered the strongest growth in the state, with the median house price growing 6.9 per cent over the 12 months to June, and units growing 10.2 per cent, according to the REIQ Queensland Market Monitor, released today (September 10).

Noosa steals the title from Gold Coast, which has led the state for house growth for the past two quarters. Noosa’s annual median house price, from 862 sales in the year to June, is $695,000. The annual median unit price is $540,000.

Noosa is now Queensland’s most prestigious market, eclipsing the Brisbane LGA median house price of $673,000 and the Gold Coast LGA of $622,031.

REIQ CEO Antonia Mercorella said Noosa had all the ingredients for price growth.

“This is a highly desirable part of the world, with stunning natural features, world-class beaches, beautiful climate year-round, outstanding shopping and dining precincts, and, crucially, exclusivity.

“There is limited housing supply being added to Noosa and competition is obviously driving price growth.

“Looking forward, once the Bruce Highway upgrades are completed and commuting to Brisbane becomes more feasible, it’s likely we’ll see added demand for Sunshine Coast living,” Ms Mercorella said.

“This area would benefit from greater supply levels, undoubtedly.”

The rest of the Sunshine Coast region delivered similarly strong results for the year to June 2018. The Sunshine Coast LGA grew 6.5 per cent to a median house price of $575,000, from 4381 sales.

The traditional state leader, the Gold Coast, continues its strong growth trajectory, although it has slowed somewhat. Growth of 4.5 per cent delivered an annual median house price of $622,031 to Gold Coast house owners.

“This is not a completely unexpected result in the post-Games period as we see normal activity resume,” Ms Mercorella said.

The Gold Coast is the biggest apartment market in Queensland, selling more than 10,000 units in the 12 months to June 2018. It was also one of the few unit markets in Queensland to deliver positive growth, adding a slender 0.9 per cent to values to a median of $429,000.

Brisbane LGA delivered consistent, sustainable growth of 2.5 per cent to an annual median house price of $673,000. This market has delivered reliable growth in the region of 2 – 4 per cent, consistently, for a few years.

“Our house market has avoided the sharp peaks and troughs of a boom-and-bust cycle and we have delivered almost 30 per cent growth over the past five years. This is a very reliable market and many forecasters predict we will continue our steady progress for the next few years while other markets may enter a slump,” Ms Mercorella said.

The apartment market has not fared so well and median unit prices eased 2.2 per cent over the year to June 2018, to $440,000. This trend has been echoed statewide with most unit markets contracting in price.

“We are seeing parts of Brisbane still coping with some apartment oversupply. But we know that the population growth to the southeast corner is strong and as major transformative projects such as Queen’s Wharf begin to take shape, we are confident excess apartment supply will be absorbed. The apartment market is showing a degree of resilience notwithstanding sensationalist commentary from some quarters predicting drastic price falls,” Ms Mercorella said.

The regional markets were patchy:

Toowoomba: This market has been a consistent performer and over the year to June delivered 1.1 per cent growth to houses, to a new median house price of $355,000. There are significant infrastructure projects scheduled for this region over the coming years and this will drive jobs and property growth. The REIQ is confident this market will continue on its steady path. The unit market held steady, with no growth or contraction and maintaining its median price of $305,000.

Fraser Coast: Another steady performer, Fraser Coast grew 1.1 per cent to an annual median house price of $318,600. This market has grown more than 10 per cent over the past five years and confidence is returning. The unit market is a standout for growing 2 per cent over the past 12 months, one of only a few markets to do so, to a new median of $255,000.

Bundaberg: This is the leader in regional markets, showing the strongest growth and adding 2.7 per cent to its annual median house price, to $287,500. This is a solid foundation for this market which is finally edging ahead of where it was five years ago. The State Government is spending almost $600 million in the Wide Bay region over 2018-19 which will drive further confidence into the market. The unit market held steady, with no contraction and no growth to maintain its annual median price of $255,000.

Gladstone: The Gladstone house market is facing continued challenges. The median price fell 6.8 per cent, however, local agents are certain there is a sense of confidence returning to the market and they say that July and August have been very busy months, so we look forward to the September quarter data. The Gladstone median unit price fell a disappointing 33.3 per cent, to $170,000.

 

Rockhampton: This market eased 2.7 per cent over 12 months to June 2018, to an annual median house price of $266,000. The unit market fell 6.5 per cent to $286,000. Rents have generally trended upwards for the past year despite a weak rental vacancy rate of 4%. The vacancy rate has been tightening for five consecutive quarters, which is some good news.

 Mackay: Demonstrating the second-strongest regional growth, Mackay added 2.5 per cent to its median house price, which grew to $335,000. This market is benefiting from a jobs boom in the region and currently has the lowest unemployment rate in the state. Jobs are bringing people back to Mackay and as a result, the rental market is also tight, at just 1.9 per cent. The unit market was the only dark spot in an otherwise blue-sky result for this former sugar-cane town, contracting 2.5 per cent to an annual median unit price of $218,000.

Townsville: Townsville house market fell 3.3 per cent, to an annual median of $324,000. However, local agents report that sales are busy and there is considerable activity with transfers coming into town. We will wait and see how the data over the next couple of quarters goes. A surprising result was definitely the growth in the unit prices, which added 7.7 per cent to a median of $280,000. Parts of Townsville’s property market are performing well. In addition to units delivering good growth, Thuringowa Central (28%), Idalia (21.3%), Rasmussen (19.9%) North Ward (15%) and Railway Estate (10.1%) delivered exceptional median house price growth.

 Cairns: The outlier in the regional markets over recent years, Cairns has, at times, been one of the only regional markets to deliver positive median house price growth. This diverse economy has proven itself to be resilient, withstanding the economic headwinds that have felled other regional economies. In the 12 months to June 2018, this market delivered 1.2 per cent growth, to a new median house price of $410,000. The unit market eased by 2.1 per cent, like many unit markets around the state, to a median of $230,000.

“Overall, Queensland’s property market continues to operate at two speeds. The southeast corner is performing well, with Sunshine Coast, Gold Coast, Brisbane and Toowoomba growing consistently,” Ms Mercorella said.

“We’re seeing some recovery in the major regional centres, limited to Bundaberg, Mackay, Fraser Coast, while the centres of Gladstone, Rockhampton and Townsville are yet to really make meaningful improvements,” Ms Mercorella said.

“The REIQ has lobbied the Government long and hard for the first-home buyers grant to be broadened to existing properties in regional Queensland,” she said.

“It is our strong conviction that this would give some of those house markets a much-needed boost as young people and first time buyers, who are struggling to save a deposit, are given that important leg up to home ownership. Importantly, these markets do not need additional supply. You can already buy an established house in these areas for less than it costs to build,” she said.

 
“It’s outrageous that the Government is funding additional housing supply in areas of the state that are already oversupplied, through this grant,” Ms Mercorella said.


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Media enquiries:
REIQ Media and Communications Manager
Felicity Moore
T: 0408 020 428 E: media@reiq.com.au