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Gold Coast Housing Market Insights: April 2022


The Urban Developer’s latest Gold Coast housing market insights reveals the city’s median house price has tipped over the $1-million mark while rental vacancy plummets causing prices to surge.

This resource, updated periodically, will collate and examine the economic levers pushing and pulling the Gold Coast’s housing market.

Combining market research, rolling indices and expert market opinion, this evolving hub will act as a pulse check for those wanting to take a closer look at the movements across the market.



Gold Coast median property prices % change

TypeMonthQuarterAnnualMedian
All1.7%▼6.7%▼31.5%▼$889,512▲
Houses1.7%▼6.7%▼33.1%▼$1,087,734▲
Units1.6%▼6.8%▲28.4%▲$654,164▲

^Source: Corelogic - April 2022

The Gold Coast has continued its run of strong capital gains, with housing values rising 31.5 per cent over the past 12 months.  

The Gold Coast experienced strong demand over the past year putting the pace of house price growth much higher than Brisbane while also outperforming Adelaide, Darwin, and Perth over the same period.

Compared with other regional housing markets around the country, the Gold Coast continues to rank among the fastest growing regions for home value appreciation.  

The coastal region recorded the third highest growth rate over the 12 months ending March 2022, after NSW’s Southern Highlands, which surged by 34.4 per cent and Hunter Valley, up 34.3 per cent.

Property prices in Queensland’s second-largest city have been dramatically rising as part of a post-pandemic boom that experts say could fuel further growth due to healthy population growth, a spate of city-shaping infrastructure projects and a resurgent tourism sector.

According to Corelogic, property values on the Gold Coast rose 1.7 per cent in April—in line with Brisbane and just behind Adelaide which lifted by 1.9 per cent and 1.9 per cent, respectively.

The result is even more impressive given that house prices have stalled in Australia's two biggest markets of Sydney and Melbourne, falling by -0.2 and remaining flat at 0 per cent, respectively.

House prices on the Gold Coast have increased by a staggering 33.1 per cent, or $280,000, in the past year with the median price now surging past the elusive $1 million mark. 

In April, house prices advanced by 1.7 per cent, a slight dip on March’s result of 2.3 per cent to be at a median price of $1.07 million while unit price growth remained healthy advancing by 1.6 per cent, or $10,000, to now be $654,000.

Mermaid Beach is now the second most expensive suburb in Queensland to buy a house after advancing by 44.5 per in the past 12 months, behind Sunshine Beach on the Sunshine Coast, which recently surpassed a median of $3 million.

For apartments, Highland Park on the Gold Coast has been the most sought after suburb with the median unit price soaring 45.9 per cent over the year.  



Gold Coast’s housing market: policy updates and trends

Construction costs soar amid labour and material shortage

The costs of building and renovating a home have surged by 3.8 per cent nationwide in the three months to September—more than four times the consumer price index of 0.8 per cent during the same period.

Over the year, residential construction costs have jumped by 7.1 per cent—the highest annual increase in more than 16 years, as the surge in new builds and renovations coincided with the disruptions to supply chains and a shortage of materials and labour.

Gold Coast housing supply constrained

According to the REIQ, there is only 1.9 year’s worth of approved housing lot supply left on the Gold Coast.

The Queensland government maintains that, according to its Land Supply and Development Monitoring Report, there is more than 15 years' worth of greenfield land supply.

Price gap luring investment back to apartments

The doorbell is ringing again as institutional property players from near and far increasingly look to dig deeper foundations in Australia’s $9-trillion housing market.

And with the gap between detached and attached housing prices widening to record levels, the welcome mat is well and truly back out in the nation’s apartment sector.



What the experts are saying about the Gold Coast’s housing market



Nicola Powell
Chief of Research
Domain

"Queensland continues to record the strongest population growth of all the states and territories.

"Those lifestyle areas, particularly the Gold Coast, have really been front of mind for those relocating from interstate."

“We're seeing one of the tightest rental markets overall when you compare it to say Brisbane and the Sunshine Coast and we're also seeing asking rents for units on the Gold Coast increase almost 6 per cent in the last three months.”


Andrew Bell
Chief Executive
Ray White Surfers Paradise

“There is simply not a sufficient supply of properties to meet the demand, and as result property prices and rental prices have had a sudden surge that has added substantially to this current discussion about the rapid rise in the cost of living.

“Given that housing cost is, for most people, the singular biggest cost of living, there were no real measures by either party to address this particular issue.

“For both properties to purchase to live in or rental properties to live in, supply is our major issue, affordable real estate in particular.”


Eliza Owen
Head of Research
Corelogic

“Although conditions remain strong, there has been a slight easing in the growth trend since peaking in December last year with a quarterly growth rate of 8.2 per cent.  

“The March quarter saw Gold Coast dwelling values rise by 7.2 per cent.

“The subtle slowdown can probably be attributed to factors such as growing affordability constraints, higher fixed term mortgage rates and lower sentiment as expectations for higher rates and higher costs of living weigh on buyer sentiment.


David Higgins
Residential Director
Colliers International

“The past 18 months have been nothing short of incredible on the Gold Coast, but what’s even more promising is that our data suggests this boom still has a fair kick to it.

“We expect the city’s population to continue its rapid ascent once the borders are opened and with that will come an even stronger demand than what we’ve already witnessed.

“Fortunately, the developers on the coast have become remarkably adept at delivering a large volume of high-quality projects catered to the markets needs, and we expect to see this climb into the new year ahead.”



Gold Coast housing market forecasts

ANZ has tipped house prices to jump by 9 per cent next year in south-east Queensland before falling by 4 per cent in 2023 as the post-pandemic boom cools.

CBA now expects house prices across south-east Queensland to increase by 9 per cent next year before plunging by 8 per cent in 2023 when the Reserve Bank ramps up interest rates.

NAB is forecasting house prices across south-east Queensland to rise by 5 per cent over across 2022 as impact of low rates and strong income support begin to fade.

Westpac has also updated its property forecasts, with south-east Queensland real estate prices tipped to surge 10 per cent between 2022 before dialling back -1 per cent in 2023.



Gold Coast auction clearance rates

WeekClearance rateTotal Auctions
Week ending 3 April 202250.0%68
Week ending 10 April 202264.2%109
Week ending 17 April 202240.9%44
Week ending 24 April 202245.5%66

^Source: Corelogic - April 2022

Fuelled by a mammoth sea-change trend, home prices in primely positioned pockets of the Gold Coast have experienced rampant growth in the past year.

Gold Coast homes are among the fastest-selling in the country—with just 16 days needed to find that million-dollar buyer, however, auctions clearing are slowly declining.

For reference, 60 to 90 days was long considered the standard for this city.

Last month, 11 Gold Coast suburbs entered the million-dollar-median club—a club that consisted of just Mermaid Beach and Surfers Paradise 12 months earlier.

That emphasis on space at a bargain price coupled with coastlines, creeks and parklands when compared to Sydney and Melbourne has increased interstate buyer activity in key Gold Coast suburbs by three-fold.

Work-from-home is also motivating land-locked residents in nearby Brisbane, who have traditionally owned holiday houses in all three regions, to take advantage of a vibrant market in the state capital and move permanently.

Tugun, Mermaid Waters, Robina and Carrara are now four of the fastest-growing suburbs on the Gold Coast, after nearby suburbs Miami, Burleigh Heads, Tallebudgera and Bundall all posted price growth of up to 38 per cent in a year.

Houses in Miami climbed to $1.06 million after the suburb experienced 38.5 per cent annual growth, while in Bundall, house prices shot up by 32.5 over the same period to $1.37 million.

Tallebudgera and Burleigh Heads each posted house price rises of just over 30 per cent to reach $1.2 million and $1.11 million while Mermaid Beach climbed close to the $2 million mark, rising by 17.9 per cent to $1.91 million.

Meanwhile, in Tugun, house prices rose almost 25 per cent to $880,000, and by 5.7 per cent in Robina to $713,500.

In Mermaid Waters, house prices jumped 28.7 per cent to $1.06 million and, in Carrara, by 16.6 per cent to $642,000—leaving plenty of room for significant growth as stock levels remain tight and southern eyes increasingly look north to the sun-drenched city.

While Mermaid Beach and Surfers Paradise are still the most expensive suburbs on the Glitter Strip, it’s the southern beachfront that’s predicted to boom throughout 2022.

According to REA Group, houses in Coolangatta had the highest year-on-year growth in the state at 49.2 per cent, followed by Miami at 48.3 per cent.

For Gold Coast units, it was Burleigh Heads, Currumbin and Bilinga that blitzed the field, posting huge year-on-year jumps in value at 45.5 per cent, 42 per cent and 37 per cent, respectively.



Gold Coast residential rental vacancy rate

CityVacancy rateMonthly changeVacanciesNet change
Gold Coast0.4%-0.1%▼176▼-125▼

^Source: SQM Research - March 2022

Vacancy rates on the Gold Coast have remained below 1 per cent since around mid-2020, with about 3 per cent considered a balanced market.

The city’s vacancy rate is now 0.4 per cent, just below the state average of 0.7 per cent.

The suburb of Oxenford is the tightest of all rental markets on the Gold Coast with a vacancy rate of 0.1 per cent.

REIQ chief executive Antonia Mercorella said with the second stage of rental reforms looming, the last thing we need right now in the midst of a rental crisis is legislative reform which undermines investor confidence.

“With record-low vacancy rates, and 36 per cent of our population renting their homes, we can’t afford to reduce the appeal of investing in Queensland. 

Domain chief of research Nicola Powell said with such stubbornly low vacancy rates on the Gold Coast, “it's likely to see rents edge maybe higher or keep at these record highs”.

“But what we are seeing, the buyer sector that is rising is investment and we are seeing more home loans being financed for investors," Powell said.

“That rising trend of investment activity will translate into additional rental stock.

“As long as we continue to see that increase or stay at the levels that we're currently seeing, that should help alleviate rental conditions for tenants.”


Gold Coast rent prices

TypeRentMonthly % changeAnnual % change
Houses$920.004.6%▲30.3%▲
Units$649.003.0%▲30.0%▲

^Source: SQM Research - March 2022

Record median rental prices on the Gold Coast continue to rise as low vacancy rates and short-term holiday leasing fuel an already competitive housing market.  

Weekly median rents for houses have jumped by 30 per cent in the 12 months to April, while units similarly cost almost 30 per cent more to rent.

According to SQM Research, the median rent for a three-bedroom house in the central Gold Coast is now $826 per week.

That’s up 12.1 per cent in the last quarter and 26.1 per cent for the year.

For a two-bedroom unit in the central Gold Coast, the median rent has risen to $644 a week, up 19 per cent in the last year.

A three-bedroom house on the southern Gold Coast will set renters back an average of $849 dollars a week and $645 a week for a two-bedroom unit.

On the northern Gold Coast, the median rent for a three-bedroom house is $743 a week, while for a two-bedroom unit it is $528.

In the western Gold Coast, rents have risen to an average of $711 a week for a three-bedroom house and $568 a week for a two-bedroom unit.



Queensland building approvals

DwellingApprovedMonthly % change
Houses2110▲5.8%▼
Units3019▲12.4%▲

^Source: Australian Bureau of Statistics - March 2022

With an additional 350,000 new Gold Coast residents expected by 2041, the state government has estimated at least 31,000 new dwellings would be needed on greenfield sites, found mostly in the region’s north.

According to experts, the Gold Coast is quickly running out of greenfield land to house its growing population, with community opposition seeing proposals for higher-density development within the city’s existing footprint rejected.

According to the REIQ, there is only 1.9 years’ worth of approved housing lot supply left on the Gold Coast.

With its almost 640,000-strong population expected to reach 1 million in the next two decades, 6500 new dwellings are now needed per year in order to keep up with the pace of population growth.

Absorbing the limited supply has been the rush from interstate buyers, particularly from Sydney and Melbourne, that have flooded the Gold Coast market throughout the pandemic in search of tree and sea changes.

Even before the pandemic-fuelled jump in housing demand, the Gold Coast’s northern suburbs were among the fastest growing in the state, with the area’s population increasing by 31 per cent to more than 74,000 between 2011 and 2016.

The Gold Coast City Council plans to target the southern suburbs of Kirra, Palm Beach, Bilinga and Coolangatta for more high-density development.

Council’s aim to boost population growth targets in the inner suburbs of Biggera Waters, Southport and Labrador were met with community opposition, forcing council to reduce the targets by 40 per cent earlier this year.

The Gold Coast has been one of Queensland’s fastest-growing regions, with its population increasing from 500,000 to more than 600,000 residents in the past decade.

Between 2011 and 2016, the population in the northern suburbs jumped by 31 per cent to more than 74,000 people after the construction of sprawling housing estates.

Between 2016 and 2019, the number of dwelling approvals within the Gold Coast’s greenfield expansion area exceeded state government expectations by 18 per cent.



Queensland home loan lending indicators

TypeLending ($bn)Monthly % change
New loan commitments for owner occupier housing2.07-46.0%▼
New loan commitments for investor housing2.4014.0%▲

^Source: Australian Bureau of Statistics - March 2022

With the cash rate now on its upward bend, following the Reserve Banks of Australia’s decision to raise the cash rate to 0.35 per cent, banks are reflecting those costs by raising their interest rates, which could take months to reflect in home lending data—according to economists.

The value of new investor loan commitments reached a record high of $11.7 billion in March, a “key contributor” to the rise in the value of new housing loan commitments.

In March, increases were reported for all states and territories, with high proportional increases in Queensland. South Australia, Western Australia, the ACT and the Northern Territory.

The average owner occupier home loan value—including construction and the purchase of new and existing dwellings—rose $7,000 to $600,000 in March.

Commonwealth Bank economists Stephen Wu said that housing lending would likely continue to cool throughout 2022 as interest rates normalise.

“The trajectory of the tightening cycle will be determined by how swiftly and how powerfully rate hikes affect the economy,” Wu said.

“Rising rates will influence both households’ and businesses’ behaviour and to that end, it is important to look closely at forward-looking indicators. 

“The new flow of lending data, together with overall credit growth, will be ones to watch over coming months as a leading indicator, including of housing prices.”



Queensland interstate migration

StateArrivalsDeparturesNet change
Queensland28,500▼21,465▲7035▼

^Source: Australian Bureau of Statistics - March 2021

The latest quarterly data from the Regional Australia Institute shows that net migration from capital cities to regional areas has doubled during the pandemic—with the Gold Coast continuing as the number one destination.

This city accounted for more than one out of 10 (11 per cent) of all capital city dwellers, primarily from Sydney and Melbourne, who moved to regional areas in 2021.

That’s more than double the Sunshine Coast, the next most popular LGA for interstate migrants.

According to research from REA Group, the top picks for NSW buyers are the suburbs of Surfers Paradise, Burleigh Heads, Broadbeach, Coolangatta, Palm Beach and Southport, while for Victorians it’s Broadbeach, Surfers Paradise and Burleigh Heads.

Since September 2020, over 10 per cent of capital city residents migrating to regional areas have moved to the Gold Coast, making it the most popular destination in the country.

With a population of roughly 3.7 million, Queensland’s south-east is Australia’s fastest-growing zone.

The Gold Coast and south-east Queensland were direct beneficiaries of Victoria’s extended lockdown last year, with a dramatic population shift north.

Australian Bureau of Statistics data for June revealed Victoria’s population fell by 12,700 while the number of interstate migration to Queensland increased by 30,000, or 2 per cent.

Before the pandemic, Gold Coast city planners were working to a framework that the population would reach a million by 2041, delivering 6000 dwellings for approximately 15,000 new arrivals per annum.

Queensland’s population is now expected to surge by more than a quarter of a million people in the next four years, according to forecasts in the federal budget, as people continue to flood in from other states.

Additional forecasts suggest it will top 5 million by the middle of the next decade.


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Article originally posted at: https://www.theurbandeveloper.com/articles/gold-coast-housing-market-insights