Andrew Bell’s Market Update: The Gold Coast – In It’s Best Shape Ever!
Issue 25 | December 8th, 2016 | The Gold Coast – In It’s Best Shape Ever!
What a year – It has been fast and furious and no question the Gold Coast is in the best shape it has been, ever. I do not say that lightly but with the benefit of decades at being at the forefront of this very unique part of the world.
November was an incredibly busy month, marked by so many sales, that really came about because of the desire of sellers to get their properties sold prior to Christmas and even more so, by purchases wanting to get into their new properties before Christmas Day. Some of the stickier negotiations had a greater purpose which created a more consolatory approach, from both sides.
How Is The Economy On An International Scale?
In recent reports we have touched on a number of significant facets of the real estate market in my last report. The good news does continue to flow. I guess everyone was concerned about ‘the Trump Effect’ and there is still a long way to go to see how things pan out. However the US, the world’s biggest economy, just posted growth of 3.2% in the past quarter, which suggests the global engine room is tracking strongly.
Good news, as is the fact the constant discussion, over several years, of China faltering has not yet surfaced. On a recent visit, to our Ray White office in Guangzhou, all of the business people we spoke to laughed at the suggestion and suggested a clamp down on corruption had changed the way business operated and business was full steam ahead under a new culture. Everywhere we visited we saw cranes up and the appetite for investing around the world was strong, due to the substantial incomes so many Chinese were enjoying.
The Five Fundamentals of Real Estate – Nationally
Back home I am constantly watching five things; GDP, which is posting growth less than usual. Interest rates, which are still at record low levels, Population Growth, which is now trekking upwards although below our previous highs, Unemployment, where again I am pleased about a report on what is being described as an outstanding surge in full-time jobs in October. Full-time jobs surged 41,500 during the month and the hours worked rose by the largest amount in five months. The result is a three and a half year low, of 5.6%, in unemployment and another positive trend, although it probably spells the end of any further interest rate falls. The fifth indicator for real estate I watch is affordability. I reported on that last week and in some earlier reports and whilst it is starting to get stretched there are no concerns, certainly while we continue in this low interest rate environment. All of the above end up, for real estate, in an area called ‘Consumer Confidence’, which again I reported on last week and it showed it is in the best shape it has been for quite some time.
How Did The Gold Coast Shape Up?
For the Gold Coast property market we certainly find ourselves with the strongest platform we have seen since 2006. In most markets the downward price adjustments have been fully recovered and prices have been on the rise, beyond 2007 levels. What is the most pleasing is our growth in prices has been mature. Steady but not as crazy as some of our inner state markets, and so, you hear no conversation about the Gold Coast property market being at risk of being in a bubble, as opposed to Sydney and Melbourne.
Our surge in population growth has seen good, steady demand for housing reflecting in a vacancy rate under 2% and a firm demand for homes and apartments to buy. Supply has been limited with shortages of resale properties reported in most markets. As I have mentioned before, I do not share concerns about our high-rise market at present because whilst there has been a significant number of approvals, I know a very large proportion of that will never reach construction phase. The main reason for this is they simply can’t get finance. I know at present even some of our biggest developers, with incredibly strong balance sheets, are simply not able to secure finance because many financiers are putting a hold on any funding on the Gold Coast, for fear there could be overdevelopment. When you hear reference to a large number of approvals for development on the Gold Coast you can at least halve that figure, if not more, at present. At best, we can describe many development approvals as being in the planning stage and not in a construction/delivery phase.
I will certainly do more of an overall report in early 2017, in our annual Property Report, when all of the latest information from 2016 surfaces. For now, we are looking forward to a really strong and positive start to 2017.
Our annual spectacular The Event will once again provide sellers of Gold Coast property with the very best vehicle to realise their sales and present to the biggest pool of buyers for Gold Coast property we see each year. We are also extremely pleased to be able to offer all of those visiting the Gold Coast in our great Christmas/New Year holiday season with an excellent array of properties.
There is no question that whatever your buying requirements are, we will have a property to suit. So for now, we still have two weeks for any property owner who wishes to capitalise on this wonderful market to contact us to be part of The Event 2017.
For those who are buying into this great market, please contact us also, on the details on screen so we can keep you informed of the great properties which are coming up in January. If you require any additional information please click here to view the website.
Want To Win A Trip To Fiji For Two?
Have your property appraised during the month of December 2016 & you will go into the draw to win a five night, return trip to Fiji for two people including breakfast daily. Simply SMS your name + address to 0448 556 908 or fill in the form here: www.rwsp.net/sell/property-appraisal. Book in your free property assessment & you could make your holiday season an extra happy one! (*Conditions apply)
I trust you are enjoying the festive season and the many Christmas gatherings which will be on. Please be careful on the roads, let’s show a lot of love for one another as we truly are in one of the best parts of the world and we should celebrate our great fortune in this regard.
Andrew Bell, OAM
Chief Executive Officer
The Ray White Surfers Paradise Group