Gold Coast development: Unit sales leap 238 per cent in 2020 as building boom escalates
House prices are going up and there’s little available to rent. A new report reveals the real reason why the Gold Coast’s property market is red hot and why getting somewhere to live will cost even more. SEE THE FULL STORY.
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NINE in 10 houses up for sale on the Gold Coast are being snapped up by eager buyers in a record-breaking splurge.
Ninety-one per cent of stock marketed in the first three months of 2021 was sold, a new report by real estate firm Knight Frank shows.
It distanced the clearance rates in Sydney (58 per cent), Brisbane (54 per cent) and Melbourne (24 per cent). Perth was closest to the Gold Coast with 85 per cent of homes put up for sale in the first quarter changing hands.
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The total number of luxury properties sold throughout Australia between January and March equalled nearly half of all high-end homes offloaded in all of 2020.
“Underlying this pent-up demand, the prestige residential market tends to gain traction with a rallying stock market, so we’re likely to still see significant price growth on the horizon,” Knight Frank residential research head Michelle Ciesielski said
The report also forecast prices on the Gold Coast to increase by at least 3 per cent this year.
The city’s real estate market has surged in the past year in the wake of the initial Covid-19 downturn.
The Australian Residential Development Review 2021 report released in June by Knight Frank Research revealed unit sales in Gold Coast developments rose 238 per cent in one year on the back of the planned light rail extension.
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According to the report, unit sales accounted for 75 per cent of all residential development sales in 2020, significantly higher than the 29 per cent in 2019.
Despite these sales, it noted the rental vacancies had fallen from 1.8 per cent in 2019 to 0.9 per cent in 2020, pushing rents up by 1.2 per cent. It is the lowest vacancy rate recorded on the Gold Coast in the past five years.
However, the report warns the demand for Gold Coast property will outstrip available supply as developers turn their attention from high-density towers to smaller, boutique projects.
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“Developers across the country are continuing to shift their focus towards boutique apartment developments which is addressing pent-up buyer demand, but these smaller projects result in less volume of prime apartments being built over the coming year,” Knight Frank residential head Shayne Harris said.
“Given the upward trend in sales volume over the past quarter, the number of days an established Australian prime property is listed on market has reduced by almost a week.
“It is still evident there are limited prestige listings across the country, with many keen buyers now buying off-market.
“Many prestige buyers focus on buying in the right location and remodel the home to suit their needs, especially with a focus on wellbeing and lifestyle and this has magnified over the past year.”
An Urbis consulting firm report released in June showed there was only about three months worth of available units left in the city – if no new projects are finished.
It is down from just above eight months in the previous quarter.
The escalation of the supply shortage comes as the number of units sold on the Gold Coast increased by 97 per cent on the previous quarter.
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UNIT sales in Gold Coast developments have surged an astonishing 238 per cent in just one year on the back of the planned light rail extension, a new report has revealed.
Towers along the future tram route at Burleigh Heads and Palm Beach have led the charge, with more than $167.8 million in sales during 2020.
The newly released Australian Residential Development Review 2021 report by Knight Frank Research underlines not only the size of the city’s biggest real estate boom in more than 30 years but highlights the increasing shortage of units.
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“The jump in high-density site sales certainly reflects the spotlight being placed on the Gold Coast by local and interstate developers, a trend we anticipate will continue with more owner-occupiers buying Gold Coast apartments, especially from the downsizing cohort,” Knight Frank residential research head Michelle Ciesielski said.
According to the report, unit sales accounted for 75 per cent of all residential development sales in 2020, significantly higher than the 29 per cent in 2019.
Despite these sales, it noted the rental vacancies had fallen from 1.8 per cent in 2019 to 0.9 per cent in 2020, pushing rents up by 1.2 per cent.
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It is the lowest vacancy rate recorded on the Gold Coast in the past five years.
The Coast’s development and real estate industry has been in overdrive for the past year, with units and houses selling out before developers can even take them to the market.
The Knight Frank report comes a week after a new Urbis consulting firm report revealed that only three months worth of available units are left in the city - if no new projects are finished.
The figure is down from just above eight months supply in the previous quarter.
The escalation of the supply shortage comes after the number of units sold on the Gold Coast between January and March increased by 97 per cent on the previous quarter.
The new apartment market recorded 742 sales in the first quarter of 2021, the strongest quarterly sales result since 2013, surpassing a quarterly record of 495 sales in mid-2016.
The southern beaches precinct recorded the highest rate, with 411 sales during the quarter, more than the 367 sold in the city’s south in all of 2020.
While the Gold Coast has soared on the back of interstate migration and surging sales, Brisbane’s apartment market has collapsed by 85 per cent in just one year, recording just $51.1 million in sales during 2020, according to the Knight Frank report.
This was far worse than Sydney and lockdown-ravaged Melbourne, which saw sales declines of 22 and 39 per cent respectively.
Knight Frank investment sales partner Christian Sandstrom said the Gold Coast’s soaring sales were a direct result of the pandemic.
“Developers are finding it difficult to locate good residential sites in Brisbane, especially as demand is increasing from buyers for high-rise apartment projects in the inner suburbs of Brisbane,” he said.
“There have been more options for developers down in the Gold Coast and this has been demonstrated in the significant uptick in development site sales in 2020.
“Both cities have seen increased population growth in the pandemic and very low residential vacancy, ramping up interest from both local and interstate developers.”
Originally published as Gold Coast development: Unit sales leap 238 per cent in 2020 as building boom escalates
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