SEPTEMBER 2017 | ISSUE 36 Queensland Market Monitor September 2017 | Issue 36 Statewide Commentary Queensland’s beachfront markets lead the charge for growth. Managing Editor Felicity Moore Research by Karina Salas The Gold Coast and Sunshine Coast house markets delivered good news for owner occupiers and investors this quarter with the state’s strongest annual price growth. Growth in the tourism sector is driving these strengthening house sale markets. Tourism is one of the largest contributors to Queensland’s gross state product (GSP). The rental markets throughout Queensland have been tightening, with the number of healthy markets falling as some move into the tight range. Caloundra was the tightest market in Queensland, with historic low vacancies of only 0.6 per cent. Property investors in regional Queensland continued dealing with weak conditions and high vacancy rates. The good news is that vacancies are improving, indicating that hope is on the horizon that a recovery may be on the cards. Continued on page 3 Your statewide property research guide suburb by suburb. Developed by the REIQ. QUEENSLAND MARKET MONITOR | 1 ISSUE 36 | SEPTEMBER 2017 REIQ Research Explanatory Notes SALES MARKET DATA ON THE MARKET INDICATORS All figures for the most recent quarterly and yearly periods are At the time of publication, latest information available was for preliminary only and subject to further revision as additional sales records the 12 months ending the month prior to end of the quarter become available (see Research Methodology online at reiq.com). reporting period. As of the June quarter 2013, all sales data includes “Recent Sales” as “Days on Market” is calculated as the median number of days it advised by real estate agents as well as official records as advised by has taken to sell those properties sold by private treaty during DNRM. As such comparisons with figures published prior to the June the last 12 months. The calculation excludes auction listings and quarter 2013 should be done with caution. listings where an asking price is not advertised. The days on market calculation uses the contract date on the property compared with A median sale price is derived by arranging a set of sale prices from the first advertised date. lowest to highest and then selecting the middle value within this set (ie, the 50th percentile, where half of recorded sales were less and “Vendor Discount” is the median difference between the contract half were higher than the median). price on a property and the first advertised price. The figure is expressed as a percentage and is an average of all private treaty Only suburbs and regions to record sufficient sales numbers (at least sales which sold for less than their initial asking price. 20 sales for the quarter) at the time of reporting are published. “Total Listings” is the total unique number of properties that have Median price changes are influenced by varying quality of been advertised for sale and captured by RP Data over the 12 month properties sold. period. To be included in the count, the listings have to be matched to an actual address. N/A Due to insufficient sales numbers (as at the time of data extraction) no median sale price has been calculated. “% Stock on Market” is the percentage of dwellings within the suburb or local government area that have been listed for sale over the past year. N/D Not displayed due to price movements potentially driven by type of stock transacting. Source: REIQ, data supplied by CoreLogic RP Data (www.corelogic.com.au) (LGA) Local Government Area PRICE POINT GRAPHS (SD) Brisbane Statistical Division comprising the LGA’s of Brisbane City, Ipswich City, Logan City, Moreton Bay Regional and Some data contained within these graphs represent preliminary Redland City. sales numbers and are subject to revision as additional sales records become available. Sunshine Coast (SD) Sunshine Coast Region comprising the LGA’s of The data excludes any recent sales transactions where the Sunshine Coast Regional and Noosa. contract sale price was not disclosed. # Figures based upon the new council boundaries The intention of these graphs is to gauge trends in sales activity between periods in lieu of actual final sales results and compare ^ Indicates acreage sales only (with land size greater than it with historical data. 2400m2). All other data is based upon sales with a land size of less than 2400m2 Source: REIQ, data obtained from CoreLogic RPData RENTAL MARKET DATA GROSS RENTAL YIELDS All median weekly rents are published on a postcode basis, House yields are based upon median house prices and RTA median as calculated by the Residential Tenancies Authority, where weekly rent for three-bedroom houses. sufficient data is available. Unit yields are based upon median unit & townhouse sale prices and Caution should be exercised when interpreting any median RTA median weekly rent for two-bedroom units. rental price data based upon a relatively small number of new bond lodgements. Rental Yield Trend: Figures for the new LGA's available for the current quarter only. Steady = +/- 0 to 0.3%pts Up = + 0.3%pts or more L Listed localities (or suburbs) represent one on potentially Down = - 0.3%pts or more several that fall within that postcode. N/A Due to insufficient new bond lodgements, no median rental VACANCY RATES price has been calculated All figures are based upon all residential rentals as at the end of Source: Residential Tenancies Authority, Rental Bond lodgements (www.rta.qld.gov.au) each quarterly period, as submitted by real estate agents. N/A Due to insufficient information received no vacancy rate has been calculated. Source: REIQ Residential Rental Survey The REIQ classes rental markets into three categories, weak, healthy, or tight. These markets are classified according to vacancy rates: 0 - 2.5% = tight 2.5 - 3.5% = healthy 3.5% - plus = weak 2 | QUEENSLAND MARKET MONITOR SEPTEMBER 2017 | ISSUE 36 GREATER BRISBANE MODEST AND SUSTAINABLE REIQ GROWTH FOR HOUSES The house and unit markets followed different trajectories throughout Queensland, and Greater Brisbane Table of Contents was no exception. Generally, Greater Brisbane house prices followed an upward path for the quarter, the past year and the past five Queensland Market Update 1 years. Brisbane LGA was one of the strongest medium-term performer, reaching a cumulative five-year growth of 29.8 REIQ Explanatory Notes 2 per cent. This is equivalent to a compound annual growth rate of 5.4 per cent. Capital City Comparison 8 Houses in the local government areas of Ipswich, Logan, Sales Market Summary 10 Moreton Bay and Redland reported moderate increases for the past year from 2.1 per cent to 3.2 per cent and the past Rental Market Summary 14 five years from 12.8 per cent to 17.8 per cent. Greater Brisbane Market Updates The unit market, on the contrary, continued experiencing Greater Brisbane 16 downward pressure on prices, with stock on market increasing and demand contracting. The unit markets in Brisbane LGA 24 Ipswich and Redland have shown price resilience to the negative sentiment of the media and general public. Time Regional Market Updates will tell if this resilience is sustainable. Gold Coast 30 According to the JLL Q3 Residential Apartment Market report, apartment supply in Brisbane inner city will reach Toowoomba 34 the peak by the end of 2017. JLL has also forecasted that construction levels will most likely normalise somewhere Sunshine Coast 38 between 2018 and 2020, which will improve the market Fraser Coast 44 fundamentals for the apartments sector. Bundaberg 48 There is no doubt that the property market follows a cyclical performance and the pipeline of infrastructure Gladstone 50 projects throughout Greater Brisbane, along with the increasing population, will underpin the recovery of the Rockhampton 52 unit market in the long run. Mackay 56 RENTAL MARKET IN REGIONAL AREAS Townsville 60 STRENGHTENING Cairns 64 Most of the regional rental markets in Queensland tightened over the September quarter, with the exception Other Regional 67 of Bundaberg, Tablelands and Whitsunday. This was good On The Market Indicators 68 news, however the rental market in most of regional Queensland continued operating within the weak range Total Listings for the September quarter. % Stock on Market Some areas in regional Queensland such as Mackay, Townsville and Fraser Coast have shown early signs of Median Vendor Discount economic recovery and there is reason to be optimistic about the future of the property market in these areas. Median Days on Market Mackay and Fraser Coast rental markets operated in the Rental Market Indicators 70 healthy or tight range over the September quarter and rents Gross Rental Yields in both markets have generally increased over the past year. Residential Vacancy Rates The gradual recovery of the regional rental market is an early sign that the regional housing markets may soon see a change of direction on the falling trend or at least price stability. Managing Editor: Research Analyst: Graphic Designer: Felicity Moore Karina Salas Holly Williams T. 07 3249 7300 T. 07 3249 7301 T. 07 3249 7312 Continued on page 4 E. [email protected] E. [email protected] E. [email protected] Source: REIQ, data obtained from CoreLogic The Real Estate Institute of Queensland Ltd. Copyright 2014 50 Southgate Ave, Cannon Hill Qld 4170 PO Box 3447, Tingalpa DC Qld 4173 Ph: (07) 3249 7347 Fax: (07) 3249 6211 Email: [email protected] QUEENSLAND MARKET MONITOR | 3 ISSUE 36 | SEPTEMBER 2017 TOURISM AS AN INDUSTRY SUPPORTING FUTURE OF THE QUEENSLAND PROPERTY MARKET EMPLOYMENT AND GROWTH The dynamics of supply and demand in the Queensland According to Tourism Research Australia, tourism was property market will shape the future of the housing sector a direct and indirect contributor of 7.9 per cent of the over the coming years.