The month in review: Gold Coast
By Herron Todd White
In general, market conditions are slightly softer now than at the end of 2014 and we may be suffering a bit of a post-Christmas hangover. We are yet to see a flow on effect of the recent interest rate cut on the property market however it is still only early days. We can only assume that market conditions will pick up in the coming weeks as interest rates are at an all-time low, everyone is now back at work after the Christmas holidays, kids are back at school and hopefully the wet weather of recent weeks will have passed.
2014 was a good year for the whole Tweed Coast property market. We saw an increase in buyer activity across most market segments which led to an increase in values for most properties priced under $1 million. 2015 is shaping up to be just as good with many local real estate agents reporting limited stock on their books, having sold most properties last year. This is in contrast to areas in the Tweed Valley including Murwillumbah where market conditions remain slow. These areas have not yet felt a flow on effect from the coastal areas.
At the southern end of the Coast, the key areas for investment will likely be Tugun, Bilinga and Coolangatta in the under $600,000 price range.
These areas have not yet seen the same growth in value levels as say Palm Beach and Burleigh and are areas for both owner occupiers and investors due to the proximity to the beach and airport and generally
strong rental returns.
On the central Gold Coast we have seen an increase in positivity in the local property market since the rate cut but probably more so in the prestige market ($1 million and above).
Broadbeach Waters has been one of the best performing suburbs on the central Gold Coast in the past six months where values for waterfront properties have firmed considerably over the past 12 months, particularly for property priced below $1 million.
Further north first home buyers have targeted suburbs such as Southport, Labrador and Ashmore around the $400,000 to $500,000 price point.
These areas provide a good standard of amenities including schools, recreation facilities and substantial retail precincts and relatively easy access to the beach, Southport CBD, Gold Coast Hospital and north and south bound M1 motorway and electric rail. Generally speaking, it appears anyone who has bought and sold a house in these areas in the preceding three years has been able to turn a profit.
We believe that investors will become more prevalent in the property market on the Gold Coast in 2015 as the cost of money has become cheaper and rental returns have increased. We have been advised by various property managers that rental levels have increased over the past six months with an undersupply of rental properties in most areas. This has led to large numbers of prospective tenants turning up to open homes with multiple offers to rent on each property.
Some advice for investors would be to steer clear of areas which saw considerable growth in value levels in 2015 (Burleigh, Miami, Mermaid Beach, Palm Beach, Broadbeach) and look further afield.
Overall, the property market on the Gold Coast is tracking along okay. We are yet to see the activity in the beginning of 2015 that we saw towards the end of 2014 however with the recent interest rate cut and talk of another cut in the next few months, we can only hope that things will pick up in the coming weeks.