Queensland’s real estate markets are predicted to enjoy strong activity in 2017 due to significant infrastructure investments, greater affordability compared to other states and ongoing low interest rates, according to leading real estate group Raine & Horne.
“The biggest infrastructure project in the state in 2017 will be the $21 billion Adani Carmichael coal mine in Central Queensland, which includes rail and port facilities,” said Steve Worrad, Queensland General Manager, Raine & Horne.
Other key infrastructure projects are the $3 billion Queen’s Wharf precinct in the Brisbane CBD, Westfield’s $1 billion development of the Coomera town centre and the $200 million extension of Gold Coast Airport.
“At the same time, the preparations for the 2018 Commonwealth Games will continue right through 2017 and will drive demand for apartments,” said Mr Worrad.
“Combined with low interest rates and skyrocketing prices in Sydney and Melbourne, we have more buyers and investors focused on real estate opportunities in Queensland,” said Mr Worrad.
Real estate values in Northern Queensland will get a boost from the construction of the Red River Zinc mine at Thalanga and the $13.1 billion ethanol project at Pentland, 100 kilometres south west of Charters Towers, according to Lisa Palmer, Principal of Raine & Horne Charters Towers.
“It’s anticipated the Pentland project will require a very large workforce in the construction phase. It’s expected most of these workers will be housed in Charters Towers,” said Ms Palmer.
“In combination, these mining projects will create demand for housing in Charters Towers, where a 3-4 bedroom home sells for $250,000 and can earn rents of up to $360 a week.”
Moreover, there is a shortage of quality investment properties because of a recent massive turnover of tenants, according to Ms Palmer.
“The Department of Housing snapped up a lot of rental properties for teachers moving to the area, which means there is a great opportunity to buy investment assets in Charters Towers to help us meet demand from the rental market,” said Ms Palmer.
“That said, we are desperate for investors, as we have nowhere near enough housing to meet the needs of workers employed by the new infrastructure projects, along with the extra teachers and our business-as-usual clientele.
“The upshot is that 2017 will be an exciting time to invest in Charters Towers real estate with excellent potential for capital growth over the next 3 to 5 years – if not sooner.”
While the mining downturn has impacted Central Queensland, real estate affordability makes this a region to watch in 2017.
“With a median house price of $275,000, Gladstone is very affordable,” said Mark Patton, Principal of Raine & Horne Gladstone.
“Other factors such as the spike in LNG production, more Australian cruise ships docking in the harbour and the Adani mine will help stabilise real estate values in our town. There is also a burgeoning aluminium-refining sector and Northern Oil’s burgeoning biocrude industry.”
“Therefore, we expect property values to pick up through 2017, making this an opportune time for owner-occupiers and investors to enter the market in a ‘destination location’ with outstanding potential,” said Mr Patton.
Massive investment in Gold Coast infrastructure will underpin real estate values in Burleigh Heads, Mermaid Beach, Varsity Lakes and Miami.
“The Gold Coast City Council has also improved its approach to the approval of smaller residential developments, which has increased the supply of affordable real estate,” said Justin Smith, Principal of Raine & Horne Burleigh/Mermaid.
“The Council has cut red tape for many developments if they can see a benefit to the local community.
“This includes creating more urban café precincts, which is attracting a younger demographic to the region. They have more disposable income, which is flushing more money through the local economy, which in turn is helping to underpin demand for local real estate,” said Mr Smith.
Currently clearance rates for on-site and in-room actions is 42% increasing to 68% in the post auction phase, according to David Bennett, Business Support & Development Manager/Auctioneer, Queensland Raine & Horne.
“The Brisbane market is price driven, which means buyers often venture beyond preferred areas and boundaries,” said Mr Bennett.
“Whether it’s Greater Brisbane, Logan or Moreton Bay the focus on price means the same bidders can turn up at an auction 20 kilometres away from the last auction they attended.”