Issue 27 | Thursday, December 3rd 2020 | Let’s Talk About Interstate Migration
Hi, Andrew Bell here with you. Before I get onto today’s topic, which is a bit more of a focus on the interstate migration that is occurring, I am pleased to report that the activity in the market continues to be robust. Sales right throughout all price brackets in the marketplace, all property types, and all areas. There are a lot of frustrated buyers who are disappointed that properties have sold before they were even aware that the properties were for sale, which reminds us that failing to market your property extensively can so frequently mean you have missed on your best buyers. Many are also frustrated with how private treaty negotiations are occurring and so they are increasingly turning their preference to buying via auction where they can compete openly in the marketplace. While stock levels remain low at present, we can certainly report that The Event 2021 program is being well supported and as such we will have a wonderful array of properties to offer from late December and running through January. All in all, this is the most active market seen in the past 31 years.
There is a strong belief that much of this activity has been caused by interstate buyers. For the larger companies who have the resources to keep records, it is interesting to see that whilst enquiry from interstate buyers is amazingly high, actual sales are not reflecting the same results. On the Sunshine Coast, around 16% of all sales have been to interstate buyers. Here on the Gold Coast, the activity has been stronger with around 26% of all sales going to interstate buyers which again shows that the great majority of sales are still occurring to locals. There is also a misconception that interstate buyers simply pay higher prices. They, like local buyers, must compete in the marketplace and the prices paid in the market reflect that competition. We are setting a lot of new benchmark sale prices, but the highest proportion of those are sales to local buyers with a mixture of interstate buyers as well.
All the talk about interstate migration fails to acknowledge that the interstate migration has been on the rise now for years. Sydney and Melbourne have been losing residents who have been going to regional areas of New South Wales and Victoria. The Sunshine State has also been a recipient of that migration.
The latest information shows that the great majority of people migrating out of Sydney and Melbourne are aged from their mid-20’s to their early 50’s. The great majority of these are moving predominantly because Sydney and Melbourne have become too expensive and they are looking for more affordable cost of living, and in particular affordable housing. There is evidence that regional markets are more appealing to older demographics, but the trade-off is that younger people in regional areas are going where the work is.
For years there has been little reported on the re-defining of cities and regions. The Gold Coast is extremely fortunate that it is well balanced to be appealing to both younger and older interstate migrators. For the younger migrators we have outstanding schooling, universities, and indeed job opportunities. Whilst for the more senior migrators, we have price differential to capital that means people can sell their homes in Sydney and Melbourne and move here, buy a property and have cash left over, we are not a densely populated area, and we most definitely have the weather and lifestyle that is so appealing.
All that has happened recently is that we have seen a surge in the trend that has been happening for several years now. I suspect that surge will come back and settle to more sustainable levels reasonably quickly. If prices fall in markets like Sydney and Melbourne, that will inhibit some people being able to move. As Sydney and Melbourne and the broader states of New South Wales and Victoria come back to life again, many people being disillusioned during 2020 and who have looked to QLD in particular as a place they are attracted to will also start to perhaps remain more settled where they are.
The reality is we cannot just absorb another 100,000 people in 2021, and I should add that I am not suggesting there are that many people wanting to move here, but we don’t have all the housing available for them to buy, schools can’t absorb the proportion of students that would come with that, jobs aren’t available for that many people, and so on and so on.
Whilst we are seeing this sudden surge of those who can easily migrate, we will start to see the numbers settle back into more sustainable levels, although it is clear that the Gold Coast will be transformed by the surge of new interest which will pop up in every aspect of our daily life.
No question that with international borders closed, with the largest booking of Gold Coast accommodation for Christmas / New Year, and with this surge of interstate buyers topping up the demand from locals, this Christmas / New Year will go down in the history books as the greatest new year real estate selling season of all time. Not a market to be missed if you are thinking of selling, and if you are thinking of selling then you must be part of The Event 2021. We start up our campaign in just a couple of weeks’ time, so it is essential you book in now to ensure you don’t miss out. Please contact our hotline on 1800 198 009 for more information.
For those of us living here, can you believe how spectacular our weather has been right throughout 2020?! The last few weeks have been simply breathtaking. Let’s get set and have a loving Christmas season and be ready for a great 2021. See you in a fortnights time.
Andrew Bell, OAM
Chief Executive Officer
The Ray White Surfers Paradise Group