Regional QLD Property Market Update November 2020
By Herron Todd White
Sunshine Coast Property Update
When we talk about prestige property on the Sunshine Coast, there is no doubt that the main region that grabs most of the attention is the northern Sunshine Coast area around Noosa Heads. It offers some of the most desirable and expensive property in Australia, but over recent months, other areas on the central and southern Sunshine Coast have shown that some strength has also returned to those markets.
The best way to show the strength in the market is to look at the results. The table below shows that since the beginning of 2014, sales volumes of $4 million plus houses and home units on the Sunshine Coast began to recover from the large losses (up to 40 per cent) incurred during the peak of the GFC. The most notable improvement has been in the coastal areas with record prices being achieved over the past six to 12 months.
The federal election result in May 2019 was deemed by the market to be positive and subsequently confidence has risen significantly. The election result combined with the improvements in the Sydney and Melbourne markets and passing effects of the Banking Royal Commission (late 2018 and 2019) led to increases in both enquiry and sale volumes. The low supply and strong demand environment in the market has consequently led to some strong increases in values. N.B: The sales that were transacted around the time of the federal election, upon reflection, have been purchased very well.
This continued into the first quarter of 2020 prior to the COVID-19 restrictions. Typically, an event like the COVID-19 global pandemic and the uncertainty surrounding it would have serious impacts on the property market and especially the prestige markets in the Noosa region given their discretionary nature. However all indications to date are that this is simply not the case. Discussions with leading agents confirm that the market remains strong and has even improved, as this area has become somewhat of a safe haven for high net worth individuals unable to travel overseas who see this market as a viable alternative. This activity is on the back of the travel restrictions into Queensland and there is some anticipation that once interstate travel opens, demand may increase further.
The lack of supply has become an issue especially for high end dwellings within sought after precincts. Subsequently we are seeing a significant number of off market transactions. The very nature of off market transactions is that to encourage vendors to sell, a purchaser will have to pay a premium. The level of off market activity is a further indication of the strength and value increases being experienced at present. This is leading to some value volatility and inconsistency in sales evidence.
We note that there are a number of new value benchmarks being set.
- 25 Witta Circle, Noosa Heads for $11.25 million, a new record for a dwelling on a single site on Noosa Sound.
- Lot 2, The Beaches, 59 David Low Way for $10 million, a new record for a beachfront dwelling in Sunrise Beach.
- 46 Seaview Terrace, Sunshine Beach sold for $17 million after selling in January 2018 for $15.2 million.
- Apartment sale on the Hastings Street beachfront in the Noosa Court building has also set a record – Unit 8 selling in February 2020 for $14 million which analyses to $54,752 per square metre.
The above are some of the really high end sales transacting in the northern Sunshine Coast areas. Below are a few examples from the central and southern Sunshine Coast.
- 44 Carwoola Crescent, Mooloolaba under contract for $2.9 million after previously selling in 2014 for $1,361,005.
- 15 Culbara Street, Mooloolaba sold for $2.525 million after previously selling in 2013 for $1.45 million.
Another effect noted in the market is that premiums are being paid for built and completed dwellings. It would appear that purchasers are willing to pay a premium for the time and effort that goes into constructing these modern higher end properties.
There is little doubt that the ability to work more remotely is having an influence on the market. Also, people have begun to bring their decisions forward. That is to say that if they were thinking of making the move to the Coast, they have started the process to make it a reality. The low interest rates on offer have been helping with this. The above examples demonstrate the market movement and volatility of this asset class, in this case positive. If we were to go back to March or April, I don’t think anyone would have for seen the confidence and strength that has returned to the market. We caution that such volatility can swiftly become negative under subdued economic conditions.
There are a number of sales that provide examples of this:
- 5 Allambi Rise purchased for $11.2 million in March 2018 – off market transaction – previous sale price of $5.75 million in October 2015;
- 49 Witta Circle purchased at auction for $5.67 million in April 2019 and only settled prior to being re-sold off market in August 2019 for $6.132 million;
- 43 Witta Circle recently settled for $9 million to an adjoining owner who purchased 45 Witta Circle for $8 million in October 2018 which is a vastly more modern, superior quality dwelling;
- 1/56 David Low Way for $8.6 million in January 2020 with a previous sale price of $7.6 million in October 2017;
- 46 Seaview Terrace purchased January 2018 for $15.2 million re-sold recently for $17 million;
- 55 Wyuna Drive purchased in December 2018 for $4.75 million has re-sold recently for $5.75 million;
- 27 Wyuna Drive purchased in September 2017 for $4.36 million re-sold recently for $6 million in an off-market transaction.
Rockhampton Property Update
The overall market in the Rockhampton and Capricorn Coast area has seen positive improvement throughout 2020, despite the ongoing COVID situation, however activity in the prestige property market, priced over $1 million in the Rockhampton and Capricorn Coast area, has seen a decline in overall sales numbers compared to 2019. This sector of the market tends to be sporadic with only two residential sales above $1 million in Rockhampton and three sales on the Capricorn Coast in 2020.
Properties in the Rockhampton prestige market are generally in the older areas of Rockhampton consisting of renovated Queenslanders on good sized allotments that generally have extensive ancillary improvements. This was evident in the highest sale for 2020, a property in Queen Street, The Range (pictured below, source: RP Data) consisting of a fully renovated, two-storey Queenslander with five bedrooms, three bathrooms and two-car garage. Further improved with an inground pool, half-court basketball court and extensively landscaped, the property sold for just over $1.5 million. The only other sale in Rockhampton was also a renovated Queenslander also on The Range for $1.1 million.
The Capricorn Coast has also seen limited sales numbers of prestige property in 2020. The highest sale was a very well presented beach front house for just under $2.2 million (pictured below, source: RP Data). The property features a semi-modern home that had been fully renovated and extended to provide five bedrooms, three bathrooms and a single lock-up garage. The property was further improved with an inground pool, extensive landscaping and solar panels and has direct beach access with magnificent ocean views.
The two other prestige sales on the Capricorn Coast were for larger modern homes in elevated positions that provided magnificent ocean views.
Listings of prestige homes in Rockhampton are currently extremely limited. One property going to auction in November is 265 Archer Street, The Range (pictured below). The property is unique in this suburb due to it being a modern dwelling constructed in the past five years as opposed to the older style homes in the area. The house provides modern five-bedroom, four-bathroom accommodation with a two-car garage. Given the location and age of the dwelling, interest is expected to be strong.
Buyers looking to enter the prestige market generally have more options available on the Capricorn Coast, with listing numbers being strong in this price bracket. Buyers have the options of either beach front homes or homes in elevated positions providing good ocean views.
One beach front home currently listed is 24 Rosslyn Street, Rosslyn for just under $1.8 million. The property features a semi-modern, renovated dwelling with four bedrooms, two bathrooms and a two-car garage on a 1722 square metre allotment. The home has a pool, detached shed, ocean views and direct beach access.
Coming into the warmer months, the coastal listings may become more popular.
Speak with a Rockhampton Mortgage Broker today.
Emerald Property Update
The high end of the residential market in Emerald has performed the strongest. These properties are generally large, good quality homes that come with extensive ancillary improvements. Demand has been slightly higher than supply so the past 12 months has seen a firming in value. Leading the way at $1.15 million is a rural residential property on 11.2 hectares with a 2012 four-bedroom, twobathroom home and living area of 282 square metres, outdoor area of 113 square metres, car parking area of 88 square metres and a 360 square metre detached shed. The property is a beautiful timber home with high quality fitting and features.
Speak with an Emerald Mortgage Broker today.
Whitsunday Property Update
The high end market in the Whitsundays is performing well despite COVID and what’s happening in other areas of Australia, with lifestyle properties being sought after. Our rural residential lifestyle properties are being snapped up with sales ranging from $800,000 to over $1 million
Properties with ocean views or frontage are also being snapped up along with vacant lots in similar locations. There have also been two sales in the prestige unit market, both selling for over $800,000.
We expect that once the borders are open, lifestyle properties will continue to move as the lifestyle in the Whitsundays is second to none. Just a little biased!
Mackay Property Update
The Mackay market has continued to perform strongly throughout 2020 despite COVID and what’s happening in other areas of Australia. The major industries of mining, mining services, government services and large infrastructure projects have remained relatively unaffected. Coupled with this, we have seen good employment in the resource sector and a migration back to the region due to travel restrictions and employment opportunities.
The prestige market in Mackay has also shown strength throughout 2020. An example is an auction held at the end of June (in the midst of the pandemic) of three large prestige properties. 43 Burnell Drive, Alligator Creek sold under the hammer for $1.6 million and the other two properties sold shortly after auction for between $1.2 million and $1.35 million.
43 Burnell Drive is a large, two-storey, architecturally designed dwelling offering excellent rural, distant ocean and offshore island views. This was the highest recorded sale of residential property in the Mackay district, until last month.
Other prestige locations in Mackay relate to oceanfront properties with excellent ocean and beach views. Dolphin Heads provides the majority of these properties. During the past 12 months, Dolphin Heads recorded three sales in excess of $1 million, with sales at $1.2 million, $1.57 million and the last sale being 68 Admiral Drive which has just sold for $1.95 million and is the highest recorded residential sale in 2020 so far. The selling agent advised he had a Brisbane-based purchaser looking for property and managed to negotiate this sale sight unseen. One of the issues with the prestige market is a lack of listings and available properties for sale, especially in excess of $1.3 million. To overcome this, we have seen a number of large architectural dwellings being constructed throughout Mackay, with building contracts alone in excess of $1.3 million dollars.
Speak with a Mackay Mortgage Broker today.
Gladstone Property Update
The prestige market in Gladstone has been very thinly traded over the course of 2020. 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 mid1990s four-bedroom, two-bathroom residence with extensive outdoor areas to take advantage of the views. Other features include significant shed space, golf buggy with built in charging station and a concrete cyclone bunker built into the side of a cliff. We are aware of another prestige property in the dress circle location of Parksville Estate in New Auckland that has recently gone under contract. We 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 the bells and whistles plus sheds, a pool and spa on a 5422 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.
Bundaberg Property Update
Bundaberg and Bargara markets are still going well despite COVID, with five properties recorded by RPData as being sold this year for between $1 million and $1.5 million and eight properties sold for $800,000 to $1 million. These properties are diverse, ranging from prestige homes and units in Bargara, either in upmarket estates or oceanfront or with ocean views, to redevelopment blocks on the oceanfront along with two properties over one hectare improved with large dwellings.
Last year, the numbers were down compared to this year, which is great news. With numerous listings for properties over $800,000 in the area, it will be interesting to see what eventuates as the weather warms up.
Hervey Bay Property Update
The Hervey Bay residential prestige market has improved over the past ten months. Across the 4655 postcode, there have been 13 recorded sales above $800,000, one of these at $1.05 million and one at $1.15 million.
The highest recorded price was for a 17.8 hectare property in Bunya Creek.
Dundowran Beach and the Esplanade running along the Hervey Bay foreshore continue to be the prime locations for prestige property. Eight of the recorded sales originated from these areas.
Realestate.com.au has 11 properties currently listed for sale in the Hervey Bay area in excess of $1 million and agents are reporting good interest in these. Furthermore, over the past ten months, we have seen the construction of a number of prestige homes along the Esplanade and beachside locations. It is encouraging to see this level of confidence in our town.
COVID appears to have triggered our market into a buying frenzy.
Agents are currently reporting limited stock across most asset classes. This is a result of vendors not listing due to thinking the market is in decline which is not the case. Furthermore, since the announcement of the HomeBuilder grant by the federal government, vacant land supply across Hervey Bay has been rapidly declining. With declining stock and strong demand, we may begin to see some long awaited capital growth over the short to medium term.
Vacancy rates for investment property are very low which is resulting in some strong yields being achieved. A recently completed four-bedroom, two-bathroom duplex is achieving $400 per week each, returning 7.8 per cent gross.
Speak with a Hervey Bay Mortgage Broker today.
Townsville Property Update
The prestige market in Townsville appears to have gained momentum during 2020 with an increase in sales volume of houses priced over $1.5 million recorded. The over $1.5 million price point is a relatively thinly traded market.
During 2019, the highest recorded residential sale was $1.55 million, however to date in 2020 we have seen two $2.3 million residential sales. These sales occurred in the second quarter of 2020 after COVID-19 had impacted the Australian economy. This would indicate that this prestige sector has not been affected by COVID-19 with anecdotal evidence suggesting that buyers in this bracket are typically associated with the medical and health industry.
The first sale was a contemporary, two-level home comprising four bedrooms, four bathrooms, double garage, lap pool, lift and private pontoon for exclusive use. The property overlooks the Townsville Breakwater Marina.
The second sale was a contemporary, industrial concrete design home located on Castle Hill with elevated panoramic views over Cleveland Bay. It has a reported 1,034 square metres with six bedrooms, five bathrooms, lap pool, lift and six car basement carparking area.
There are currently a number of properties being offered to the market in the over $2 million price bracket. Overall the prestige market remains positive however it does require the three rights: right property; right time; right buyer.
Toowoomba Property Update
Despite strong buyer inquiry, the volume of prestige housing sales in Toowoomba has slowed in 2020. A deeper analysis of this trends shows the market has been constrained by a supply shortage. For relativity, there were 43 dwelling sales in excess of $1 million in 2019 which equates to around four sales per month. Up until then end of September 2020, there had been approximately nineteen settled sales which equate to around two sales per month.
There has been reasonably strong activity for modern, resort-style homes in Middle Ridge. A recent example is 11 Daniells Close which sold for $1.05 million.
Setting a new price benchmark in Middle Ridge for this type of dwelling was the sale of 12 Thorley Court for $1.41 million.
The prestige East Toowoomba suburb has been showing limited sales activity however agents are reporting strong buyer interest from locals and parties from outside the area. Agents are reporting new levels of inquiry from interstate buyers looking to regional areas like Toowoomba for a lifestyle change. The rental market for prestige houses in Toowoomba is very small with the vast majority of homes owner-occupied. Traditionally, yields for prestige dwellings are low by way of comparison with more conventional housing however with the current vacancy rate now sitting at less than one per cent, there is likely to be an upward shift in rental prices as the end of the year approaches.