How the Covid-19 property boom has reshaped home ownership
Property boom : The dream of owning a house by the sea is fast fading as booming prices push property in the Coast’s most sought-after areas out of reach for many families and first home buyers.
Investing in a duplex or apartment close to the beach has become the alternative for buyers with a budget of $700,000 who can no longer afford to purchase a detached house, a new report shows.
Herron Todd White’s monthly review found free-standing houses along the Coast’s central stretch of Burleigh Heads to Surfers Paradise were now mostly priced above the report’s national benchmark figure of $700,000.
It comes as the city’s median house price soared to $780,000 last week according to REA Group data, as regional QLD’s relatively affordable real estate and attractive lifestyle lures cashed-up interstate buyers.
“Opportunities to buy a detached house at the $700,000 price level are becoming harder to find,” said Herron Todd White director Janine Rockliff.
“We note that many buyers at this price point are either first or second home buyers or renovation flippers who are looking for a project with a quick turnaround.”
Those priced out of the detached housing market could look to townhouses or duplexes in suburbs including Varsity Lakes, Robina, Miami and Burleigh Waters; while strata-titled units in Miami, Burleigh Heads and Burleigh Waters were also performing well.
“Finding a unit within an older style, small, walk-up complex on a block with future redevelopment potential might be your best bet,” Ms Rockliff said.
Meanwhile, demand for highrise apartments in Surfers Paradise and Broadbeach was at a 10-year high, with limited stock even in large buildings such as Chevron Renaissance, Q1 and Circle on Cavill.
Modern two-bedroom, two-bathroom units with ocean, city or river views were the pick for investors here.
“It appears that buyers are less concerned with body corporate fees at the moment as rental values have been moving upwards post the impact of the Covid-19 pandemic in 2020,” Ms Rockliff said.
The outlook was similar in the southern suburbs, which had clocked huge growth on the back of work-from-home buyers ditching capital cities for a relaxed coastal lifestyle. property boom
In Coolangatta for example, a budget of $700,000 secured a two-bedroom unit in original condition with restricted ocean views and within walking distance to the beach.
But if having the surf at your back door isn’t top priority, limited options to snag an older-style detached house still exist in areas such as Labrador, Parkwood, Arundel and Helensvale.
“Properties in these suburbs in this price range are typically 1980s to 1990s-style dwellings which provide either three or four-bedroom accommodation,” Ms Rockliff said.
Real Estate Institute of QLD Gold Coast chairman Andrew Henderson said property values were also impacted by changing infrastructure and development to accommodate the city’s growth.
“It has become much more difficult to get a free-standing house close to the beach, where the pricing well exceeds that $700,000 mark,” he said.
“With the changes in density to accommodate the growing poulation comes re-zoning and changed height restrictions, and hence a square metre of dirt or sand becomes more expensive due to the development which could be undertaken there.” property boom
Mr Henderson said buyers could look to older houses in areas pegged for new infrastructure such as Merrimac, Helensvale or Carrara for best value; while acreage in Tallai or Highland Park and older units in Palm, Beach, Broadbeach or Surfers Paradise were also good picks.
“There are definitely still options available where you may be lucky enough to get into an older, well-established neighbourhood and perhaps sink your teeth into a renovation.
“But also the appeal of apartment living has changed a lot in the last few years. Often people who may have really wanted that backyard or extra space are now more comfortable in an apartment or townhouse because it gives them greater opportunity of where to buy, and then instead of mowing the lawn every weekend they have the time for more recreation,” Mr Henderson said.
Yet the HTW report found even in the northern growth corridor suburbs such as Pimpama and Ormeau, where land still exists to accommodate new estates, buyers with $700,000 to spend on a house would be looking at one that is more than 20 years old and without a swimming pool. property boom
Accordingly, increased household savings and government stimulus to bolster the economy through the pandemic has seen home buyers up their budget to get a foothold in the market.
PRD’s latest economic and property report shows housing finance commitment was at an all-time high of $32.6b in May. The value of home loans was up 1.1 per cent for first home buyers, and 2.6 per cent for others.
PRD chief economist Diaswati Mardiasmo said consumer demand was also at record high levels, fuelling growth in regional markets which has continued since the first round of Covid-19 restrictions ended last year.
“However, there is another side to this — property prices have broken records which has led to Australians taking on higher debts and an inflation of lower-priced homes,” Dr Mardiasmo said.