Strong demand in resource regions

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Queensland’s resource centres continue to experience strong demand from buyers however property price growth in Gladstone appears to have plateaued this quarter with its median house price steady at $475,000 – albeit after posting median house price increase of 16.5 per cent over the year ending March.

REIQ Gladstone zone chair Mark Spearing said while the market was pausing for breath, sales activity remained healthy.

“The quarterly price changes in the majority of suburbs are merely a reflection of the different quality of homes selling as house price growth across the board remains strong,” he said.

“Investor activity is still robust however there is some resistance above the $500,000 price bracket. Most investors are focused on the unit/townhouse market, particularly furnished properties located close to the city centre.

“First home buyers are being priced out of the market, due to the competition from investors.”

After a very strong period of price growth and sales activity, Mr Spearing said the outlook for the region’s property market remained bright.

“The outlook for the region remains very positive as the resources industry continues to grow” he said.

“The high confidence levels amongst buyers and vendors alike will ensure property price growth and sales activity continues along at healthy levels.”

Rockhampton’s median house price increased 1.6 per cent to $320,000 over the quarter.

REIQ Rockhampton zone chair Noel Livingston said the region was benefiting from its strong rental market and affordable property prices.

“Sales activity is up significantly compared to the December quarter and compared to the same time last year,” he said.

“This is being driven predominantly by demand at the lower end of the market. Anything priced up to $400,000 is selling relatively quickly and we are seeing increased activity from investors.

“Interest is coming from local investors, those associated with the mining sector, and from the southern states.”

Mr Livingston said the region had an air of confidence due to its proximity to resource precincts however it wasn’t reliant on the mining sector for success.

“Rockhampton has long had a very stable market and we generally don’t ride the rollercoaster of ups and downs that Gladstone does for example,” he said.

A solid performer over the quarter was West Rockhampton, which posted median house price growth of 3.8 per cent to $270,000.

Mackay’s median house price increased 1.2 per cent to $425,000 over the period.

REIQ Mackay zone chair Sally Richards said the market was continuing to attract plenty of enquiry and sales.

“There is strong enquiry from all buyer types with many buyers starting to realise that the bottom of the market has passed,” she said.

“Properties that are priced correctly are selling very quickly and investors are also active given the strength of our rental market.

“There are still plenty of opportunities out there for buyers before the market takes off too much.”

Over the year ending March, Mackay was one of only two major regions to record positive price growth – its median house price increased 2.5 per cent over the period.

A solid performer over the March quarter was West Mackay which posted median house price growth of 5.1 per cent to $408,750.

 

By Yvette Burton, research analyst, REIQ