26 Feb 10 Things: Gold Coast
What’s going on with the Gold Coast housing market?
1. About 577,000 people live on the Gold Coast. It is expected to grow by some 12,500 new residents per annum.
2. There is a need to build 5,000 new dwellings each year to adequately house this demand.
3. Just over 5 million tourists stayed overnight on the Gold Coast last year. They stayed for a total of 24 million nights. This market grew by 7% last year. Expanding tourism is also fuelling new dwelling demand.
4. The tourism industry contributed about $6.4 billion to the Gold Coast regional economy last year. This represents about 20% of the Gold Coast’s $31.5 billion economy.
5. Tourism supports approximately 46,000 jobs on the Gold Coast, which is 18% of the total local jobs. The Gold Coast, as outlined last week, currently holds 262,000 local jobs.
6. Other local registered businesses numbers have also been on the increase. Local unemployment is on the decline.
7. Residential sales, too, have increased, as have new dwelling approvals; but new dwelling supply is struggling to keep up with demand. More on this later this week.
8. The dwelling market is in a strong upswing in terms of sales. There were 8,500 detached house sales; 10,000 apartment sales; 4,000 townhouse sales and 2,500 vacant lot sales on the Gold Coast last year. These volumes are more than double those traded just five years ago.
9. Current attached dwelling values are rising faster than the mid-term, and especially long-term, average. Median house values rose 7.6% last year; apartment values rose 5.7% and townhouse price were up 4.5%.
10. So, too, are weekly rents, especially for apartments and townhouses. Our available rental rate for the Gold Coast is currently 1.7% for apartments, 2.0% for townhouses and 3.7% for detached houses. There are just 2,000 dwellings advertised for rent on the Gold Coast.
The Gold Coast current momentum is being somewhat influenced by new construction associated with the Commonwealth Games.
We expect – post the Commonwealth Games (early April 2018) – that the local market will cool, but the good news is that there is little to warrant a market bust – values aren’t inflated and there are serious limits on housing supply. But Ceteris paribus and Caveat emptor apply.
An increasing number of things could change the above scenario. That’s a watching brief, but for now and under the current parameters, the Gold Coast’s housing market is looking pretty solid.
~ Credit Michael Matusik