Regional QLD

The Smartline Report – September Edition

The month in review: Regional QLD

By Herron Todd White
September 2016

Sunshine Coast
When we look at the types of properties on the Sunshine Coast or more specifically the style of home on the Sunshine Coast, it is somewhat difficult. There is no one standout as we cater for all types. The main centres such as Nambour, Caloundra, Maroochydore and Noosa remain relatively young being populated in the early 1900s and continued to remain relatively small townships until the 1950s and 1960s. Through these times the coast remained a popular holiday destination, with home types essentially being small holiday homes or shacks,
typically the skillion roof and fibrous cement type properties.

Inland we saw the more typical timber cottages of typically the post war modern style with skillion roof and fibrous cement.

We have only seen in the past 40 years the developments on the coastal strip effectively linking Caloundra and Maroochydore and Noosa Heads to a lesser extent. Subsequently what followed were the more conventional type constructions. We still saw beach shacks being constructed, but generally we saw the rise of the slab on ground brick constructions. These homes have continued to evolve to what we see today throughout the various modern estates, however typically they are on significantly smaller allotments.

Over the years though, we have seen some design elements for the post war modern style homes creep into the modern contemporary home. Light weight composite cladding materials have allowed this style of home to be achieved at a relatively cost effective price.

When looking at units on the Sunshine Coast, the first thing that typically comes to mind is the original old six pack with garaging on the ground floor, then two units per floor for the three levels above. They were built for a market at a price and went well. It wasn’t until the mid to late 1980s that we started to see buildings of a larger nature of ten or so storeys. These buildings have continued to evolve into high quality apartments that in many cases provide significant views.

Finally we look at the townhouse and duplex unit market. Once again, they were quite basic when they first started out. Now they have grown into complexes that are not only good looking but also desirable and providing investors with some decent returns.

All in all the Sunshine Coast provides a significant variety of property types and styles. All it comes down to is your budget and personal preference.

This month we are looking at what some would call the traditional property types in our area. We have some of the original timber weatherboard houses in the older parts of Walkervale and Bundaberg South and Bundaberg West. Entry level into these areas is at about $160,000 and will get you an original house on almost 1,000 square metres. $210,000 will get you a partially renovated 1960s timber and brick split level home with a detached 2-car colourbond shed. The middle of the market is the mid 1990s 3-bedroom 2-bathroom 2-car attached garage at $240,000 to $290,000. The next level of the market is the newer 4-bedroom 2-bathroom
with 2-car built in garage that start at $300,000 depending on the location and size of the dwelling and quality of fitout. In the newer estates this figure starts at roughly the $400,000 mark.

Lately we are seeing a move to the larger rural residential blocks of 2,000 square metres plus where larger homes are being constructed. Suburbs such as Branyan , Woongarra and Gooburrum seem to be popular.

Investors are more active in the lower, more affordable end of the market where returns are between 5% and 6%.

However we are seeing the rental vacancy rate climbing to above 6.3% at the moment which is something to keep your eye on.

Maryborough and Hervey Bay
Maryborough is known as the Heritage City with property dating back to the 1800s. The high set Queenslander style home with the large wrap-around verandah is prevalent throughout Maryborough, with common features such as polished timber floors, high ceilings and fretwork. Most dwellings of this style comprise of 2-bedrooms with sleepouts, and some properties have been enclosed underneath to provide further living areas. The Queenslander style home is a relatively high maintenance project, with timber external and internal walls requiring painting, restumping and eventual roof replacement. Once these dwellings have been restored however, they represent a stunning example of our heritage property and are most suited to owner occupiers due to the ongoing maintenance regime.

A recent renovating trend has been to enclose part of the sleepout for a walk-in robe and en suite, which is regarded as an innovative use of this space.

Property prices in Maryborough remain very affordable, with prices slightly declining over the past few years. Some refurbished homes are known to sell from $190,000 with generous lot sizes around 1,000 square metres.

Most property in Hervey Bay is relatively new compared to Maryborough, with suburbs such as Eli Waters, Kawungan, Urraween and Wondunna predominantly developed in the 1990s and continuing. Housing in these areas typically comprise of brick and tile onground dwellings providing between 3- and 4-bedroom accommodation on standard lot sizes of 600 to 1,000 square metres. Wondunna, Urangan and Urraween do have pockets of larger acre and half acre sites.

The older suburbs of Point Vernon, Pialba, Scarness, Torquay and Urangan include a mixture of modest low set housing close to the beach. Along the Esplanade there are many older homes (circa 1950s onwards) achieving a variety of ocean views, with some new larger modern dwellings now being constructed. In recent times, the establishment of contemporary estates continues in various locations throughout Hervey Bay. Demand appears to be keeping pace with supply for this new stock with both investors and owner occupiers contributing towards sales turnover. Government incentives are still available for property located in certain growth corridors (refer Hervey Bay Affordable Housing Incentive) for land and house and land packages.

Emerald has gone through four major building and construction booms over the past fifty years. There was a major construction phase in the 1960s to 1970s of railway homes, housing commission and blue collar workers’ accommodation. These are now selling near the bottom of the market in the $120,000 to $160,000 range. Then there was the opening up of many coal mines in the Bowen Basin region in the late 1970s when mining companies built many homes in town from 1978 to 1994 of very similar design and style. These are now selling mostly in the $160,000 to $220,000 range. We then saw a large expansion of the town by private developers and our own council in the 1990s with many owner-occupier and custom built homes of the highest quality the town had ever seen. These were your large executive style homes along with a great expansion in the rural residential market. This created some prestige estates which still hold a premium today. Then we saw the last boom from 2004 to 2012 which was the largest the town had experienced with many single dwellings and unit complexes being constructed. Some of these large, modern homes under ten years of age with pool, shed and located in good estates are holding at the top of the market in a range of $450,000 to $550,000, back from the peak of $700,000.

There are currently bargains across all price points from the basic neat home built in the 1980s around $140,000 through to executive homes built in the 1990s selling at around $250,000 up to acreage selling in the range of $400,000 to $550,000. The acreage had held firm the longest but in the past 12 months we have seen it come back significantly in line with the fall in single dwelling properties in town. The market is currently in a position where you can get much more with a lot less money than you could four years ago. If you’re a first home buyer or have a deposit and ready to go, now is the cheapest time to buy in the past 11 years.

The traditional property types in Gladstone have all been established on the back of major booms in the industrial sector.

Prior to the 1960s Gladstone remained a relatively small port city serving the local cattle industry. In 1963 Queensland Alumina Refinery (QAL) was announced, beginning over a decade long boom during which Gladstone’s population doubled. The first, second and third stages of the refinery were built along with the first stage of the Gladstone Power Station. Most of Gladstone’s central suburbs including South and West Gladstone and Barney Point were well established. Homes in these suburbs are popular in today’s market given their close
proximity to the CBD and the varying views available from the low and high set style homes. These suburbs also offer good opportunities to renovate older style homes in central locations. The entry level price point for homes in West Gladstone and South Gladstone is around $200,000 in the current market. The early 1980s saw the next wave of industrial development with the commencement of the Boyne Aluminium Smelter. Much of the established parts of Boyne Island and adjoining Tannum Sands were developed during this time. Construction ranged between on ground and high set homes. Price points for this style of housing in Boyne Island and Tannum Sands ranges between $300,000 and $350,000 in the current market. Gladstone suburbs such as Kin Kora, Sun Valley and parts of Clinton and New Auckland were also established during this time. Kin Kora and Sun Valley comprise mostly high set homes and are popular well established suburbs in today’s market. Prices in these suburbs range typically between $250,000 and $350,000.

In the 1990s the coal industry boomed giving Gladstone another boom in property prices and demand. New housing estates in Clinton, New Auckland, Glen Eden and Telina were developed comprising mostly 3-bedroom on ground brick houses. New Auckland and Clinton were further established in the early 2000s when Rio Tinto
announced the Yarwun Alumina Refinery was to proceed.

The most recent construction boom (2010 to 2012) commenced when construction started on three LNG plants being built on Curtis Island off the coast of Gladstone. This boom saw fringe suburbs including Glen Eden, New Auckland and Kirkwood being extensively developed with modern housing. A transformation also occurred in Gladstone City with multiple high rise apartment buildings going up in the CBD and extensive townhouse developments taking place in the suburbs. Over 1,000 units have been built in the past five years alone.

Any local will tell you that Gladstone has always been a boom and bust town. Investment in the town soars when a new project begins as demonstrated over the past 50 years. This is always followed by a bust during which the town re-gathers itself and gets back to normal. Presently we are in the fourth year of Gladstone’s latest downward cycle. Established housing has declined as much as 50% and units as much as 80% from values achieved in the peak of the market. The vacancy rate peaked in the first quarter of 2016 at just over 10% and has been steadily falling since which may indicate we have seen the worst of this bust. Only time will tell.

The Rockhampton residential market consists of a number of different types of dwelling styles. Older areas consist of pre-war Queenslanders and Gable dwellings. These areas also consist of the highset chamfer board dwellings popular in the 1950s and 1960s.

As the city expanded areas have consisted of high set fibro and hardiplank dwellings common in the 1970s and 1980s and leading from the 1980s through to the 2000s you now have the modern brick on ground dwellings.

People’s budgets, tastes and the area in which they want to live will determine what style of dwelling they purchase.

South Rockhampton is a more traditional area with a small pocket of more modern home styles. Older areas tend to have larger allotments. The suburbs of The Range, Wandal and Allenstown continue to be popular and tightly held. North Rockhampton has a mixture of everything with Frenchville, Norman Gardens and now Parkhurst consisting of more modern dwellings.

North Rockhampton is where all of the growth is with a number of new estates offering a variety of sizes of allotments. Some are offering smaller allotments while other estates still offer larger allotment sizes which offer room for a house and shed. These estates provide options for first home buyers generally on the smaller allotments and second home or upgraders on the larger allotments.

Current market conditions have seen prices reduce in the older areas of North Rockhampton and smallerpockets in South Rockhampton. The more modern style of dwelling has had less impact in the North
Rockhampton area. Traditional areas on the south side are now thinly traded and have also had less impact compared to less popular areas.

Today we have a look at the traditional home style of Mackay. Development in Mackay comprises older style 1940s to 1950s style high set and low set timber dwelling in suburbs of Mackay, South Mackay and West Mackay. However one dwelling style that was very popular in Mackay through the late 1960s right through until the mid 1980s was the highset fibro and hardiplank clad dwellings, more affectionately known in Mackay as the butter box (named due to the yellow coloured fibro walls and rectangular shape). These dwellings can be found in almost all established suburbs of Mackay. Price points in the current market are around the $200,000 mark and increase depending on condition and location. The majority of these dwellings have been enclosed underneath to provide rumpus areas, however almost all are below the council habitable height.

In more recent times, we have seen the modern equivalent of onground rendered masonry block dwellings. It is difficult to establish other building styles due to cyclone ratings required in this part of the world. These dwellings start around the mid $300,000 for basic smaller dwellings up to around the mid $500,000 for larger good quality dwellings in better estates.

The type of property that traditionally appealed to the average home owner differs within the Whitsunday region depending on its location. In Airlie Beach the original dwellings were older 1960 homes, then in the 1980s small high rise unit blocks became visible in the market with the majority owned by investors. These units were built on the side of mountains to benefit from ocean views. This trend of units continued into the early 2000s and also crept into the neighbouring suburb of Cannonvale. These older high-rise apartments still appeal to the market
because of their close proximity to Airlie Beach and their ocean views.

Suburbs such as Cannonvale and Jubilee Pocket are more traditional owner occupied suburbs with some investors creeping into the market now. These suburbs are located on either side of Airlie Beach. There is currently a transition in both suburbs to more modern style dwellings which are either typically on-ground rendered masonry or modern highset dwellings located on elevated sloping lots taking advantage of views. The appeal of Cannonvale and Jubilee Pocket is their proximity to Airlie Beach and essential services such as shops and schools. Just on the outskirts are rural residential life style lots which are popular with owner occupiers.

Proserpine is an older suburb based around the sugar cane industry. Its traditional dwelling is a detached circa 1960 lowset house. Proserpine like Cannonvale and Jubilee Pocket has started to move towards more modern, on-ground masonry dwellings. There is no consistent price point that has attracted buyers to the market. There is something for every one in this area.

The market was heavily affected by the Global Financial Crisis because of its links to the Australian and international tourist markets. Property values were high pre-GFC, then suffered a steep decline. The market dropped until 2013 and since then values started to recover and have stabilised. It is expected that sale prices will remain steady.

The most common styles of housing found in Townsville include the classic Queenslander, low set masonry block homes and 1950s style high set timber framed dwellings.

The classical high and low set Queenslander workers cottages, bungalows and colonials are typically found in and around the fringing inner suburbs. These homes are generally on traditional sized lots and buyers of this style of property typically appreciate the classical design and are attracted to the period features, finishes and use of natural products compared with modern day design.

The masonry block home is typically located within the more modern established suburbs and generally comprise single or double lock-up garage (under main roof  and three or more bedrooms with two bathrooms. This style of property offers a lower maintenance option to the classical Queenslander and is typically constructed on lot sizes from 400 square metres. Price entry for a modern home in the newer residential estates within eight kilometres of the city is around $380,000.

The other typical house style found in the Townsville market is the 1950s style high set timber framed dwelling. This style is found throughout a large portion of the older established suburbs including around Aitkenvale, Cranbrook and Gulliver.

Traditionally these homes were constructed with a 3-bedroom, 1-bathroom floor plan accessed via external stairs and typically the lower level is either open or enclosed with timber palings. Over time, we have seen the sub floor levels become enclosed with masonry block to provide further storage utility with some houses (if floor height permits) being enclosed to the subfloor with masonry block and internal stairs to provide additional living space. Price entry for a basic high set home in one of these suburbs is from around $250,000.

Depending on individual preference for style, price point and location, we have seen both home owner and investor interest in a wide range of property styles. The Queenslander style properties typically lean more towards the owner occupier market as they don’t offer as good tax depreciation benefits as newer property and often require higher levels of maintenance. From an investor perspective more modern homes offer better tax depreciation benefits, however the price entry for this type of property is generally significantly higher than that of a basic entry level investment property.

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DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.