Sunshine Coast Property Market February 2011
Sunshine Coast Property Market February 2011
The following post has been provided by David Tyson from Sunshine Coast property valuation firm, Platinum Valuations. Dave can be contacted on 0438 721 845
Sunshine Coast Property Market Conditions
Current real estate market characterised by depressed pricing and strong buyers market conditions = good time to buy but not great time to sell. The overall number of sales has dropped dramatically off peaks 2006 -07. Agents report tough negotiations in the last 12 months with vendors often unwilling to meet the market. If property is not priced to sell it will sit on the market with limited interest. First home buyers are also as rare as hens teeth at present.
Influences on the local market
Increasing pressures on the household budget due to price increases in the cost of living eg: fuel, water, electricity and food
Increasing local unemployment where the 3 pillars of local employment - Building, Retail and Tourism are under significant strain due to very tough conditions in each sector
Increasing cost of land supply to developers due in part to planning and approval delays and added environmental requiremental approval costs
Slowing of net interstate migration
Increases in interest rates over the past year taking away disposal income and decreasing housing affordability
Credit squeeze from banks on lending for land subdivisions and unit development making most projects unviable
(from HIA stats) Decrease in QLD new home building approvals Dec Qtr 2010 down 15.9% and QLD housing starts down 25% in the Dec Qtr 2010
Lending for renovations down
What does all this mean?
In valuation terms we have seen price levels drop from the peaks of 2007 between 10-30% depending on the location and the type of product. The investment market has fared worse than the owner occupier market with cashed up buyers thin on the ground and being able to command significant discounts on prices from a few years ago. We are seeing more mortgagee in possession sales than we have seen for 15 years locally. The top end of the market has not been spared with percentage price falls often out stripping the lower to middle markets. We are lucky locally to have been spared the impacts of the recent floods and cyclone which impacted areas around the Sunshine Coast region. Affordable areas of the coast have fared somewhat better than middle to upper price locations.
Tough market conditions have claimed the following local developers and projects over the past 18 months:
$400m Elysium development at Noosa
Noosa Blue Resort Noosa
Attunga Heights development Noosa
$300m Viridian Resort Development
$210m Noosa Sanctuary Development
Adenbrook Homes a large volume builder locally
New Image Homes a smaller builder locally
S & L Developments- Scott Juniper (son of Graeme Juniper- renowned local developer)
Most developments have been placed in moth balls as projects are deemed financially unfeasible.
As valuers we are seeing significant volumes of our recent work load coming from refinancing and from savvy buyers who will get property valued prior to purchasing. If you are a buyer you are on the right side of the demand supply equation therefore it not all doom and gloom. Remember, if you buy and sell in the same market then the relative loss and gain should be put in perspective.
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