Gold Coast property market booming despite closed borders — so what happens when overseas buyers return? By Dominic Cansdale
Queensland's border is once again shut but the Gold Coast property market continues to surge, driven in large part by interstate buyers unable to visit the properties they are purchasing.
While it is still unclear whether there will be a staged reopening to certain countries, Tourism and Trade Minister Dan Tehan yesterday flagged that the international border will be opened to some travellers by Christmas.
The announcement appears to be mostly directed towards vaccinated Australians at this stage.
But given the Gold Coast property market has been strong despite border closures, the eventual return of overseas buyers, while still uncertain, could drive up demand even further.
More than 50 residential projects with an estimated value of $4.8 billion are under construction across the city, according to research from Colliers International.
Colliers Gold Coast director in charge Steven King said international borders were "the number one question".
"It could be scary to see how many people do want to come to the Gold Coast," he said.
Demand already high
Urbis research shows that in the June quarter of this year, international buyers represented just four per cent of the Gold Coast market for new apartments — a far cry from the pre-pandemic figure of 25 per cent.
But record new apartment sales still persisted, driven in part by interstate buyers, who represented a 21 per cent share — and low interest rates.
The intensity of interest from interstate developers, especially for the new, high-end projects, is something Mr King says he has not seen in 20 years.
"A lot of people from Melbourne and Sydney always wanted to come to the Gold Coast," he said.
"COVID has probably brought forward those plans many years, where they're [buying] now as opposed to when they retire."
According to Urbis, a record 742 new apartments were sold in the March quarter of 2021, with weighted average prices between $1 million and $1.3m in central and southern suburbs.
While Mr King said that demand meant "prices have got to go up", the Gold Coast was still more affordable than some other places.
"In Sydney's CBD we've seen prices in excess of $70,000 per square metre," he said.
"On the Gold Coast our highest prices are circa $20,000 a square metre."
'It's our time'
About 30 per cent of the $71m worth of luxury apartments sold at Rainbow Bay's Esprit development last weekend were snapped up by Sydney and Melbourne buyers.
"Every time, in particular Melbourne, at this point, goes into lockdown we see another surge in inquiry," KM Sales and Marketing director Jayde Pezet said.
"We're astounded by the depth of the top end of the market."
He said the already strong growth could be buoyed further when international buyers returned.
"The southern markets into the international markets, and then through to the Olympic Games — I think we're going to be in for a pretty good ride here on the Gold Coast in the next ten years," Mr Pezet said.
"It's our time."
Jump in average prices
CoreLogic data shows average Gold Coast house prices increased by 22 per cent between July 2020 and 2021.
In the 12 months leading to March this year, the average price of new apartments increased by 23 per cent.
"When you talk about people getting priced out, I think it's more about location," Mr Pezet said.
"There's development going on further west and I think that's more of the entry-level price point."
Southern Gold Coast Reality agent David Marshall said it was "hard to find a house under a million dollars" in the southern suburbs.
"It's limited stock available and high demand."
Locals look south
Mr Marshall says the "southern end of the Gold Coast is probably not as impacted through international buyers".
"I rarely sell a property to the international market," he said.
"Particularly the Asian market seems to like to be around shopping centres, high, built-up areas [like] Broadbeach."
But Mr Marshall said the trend on interstate demand remained strong, even for a "1950s retro classic" in Coolangatta.
"The level [of] interstate interest is rivaling – if not higher than – local interest," he said.
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