Agent predicts Gracemere preparing for residential boom

GRACEMERE is a town preparing for a residential boom, not a bust, according to a local real estate agent.

GRACEMERE is a town preparing for a residential boom, not a bust, according to a local real estate agent.

Stan Cooke from Cooke Real Estate in Rockhampton prepared a sales and rental report this month.

He said while there was a slight over supply in the short term, the medium and long-term prospects for Gracemere were excellent.

Despite reports describing Gracemere as an over supplied rental market with 11% vacancy rates, Mr Cooke said the current vacancy rate for Gracemere was a little over 5% and has dropped dramatically since last year.

"There has been a short term glut of rentals created by around 350 new homes hitting the rental market between June and December last year and that's a lot for any market to absorb at once," he said.

"Now about 80% of those have already been rented and at the current uptake rate they will all be rented by the middle of this year."

Mr Cooke said the 11% figure was correct late last year.

"Almost 300 of those 350 houses have been rented over the past eight months or so, which is outstanding for any rental market to absorb that many."

Cooke's report was commissioned by a major property development company as part of a review of the Rockhampton property market.

To get the figures he spoke to all letting agents operating in Gracemere.

There were 161 approved new houses in the 12 months ending December 31, 2013, with $45.4 million of building value in residential building approvals.

According to the state government statistician's office the median residential sale price in the 12 months ending June 30, 2013, was $348,000 in Gracemere, compared to a state average of $390,000.

The State Government predicted the population of Gracemere to rise to around 20,700 in 2036.

Based on this growth, the Cooke report has identified a need for an extra 190 homes per year but has concerns about a critical land supply shortage.

He said there were currently about 180 blocks of land being developed in Gracemere, with only 120 in approved subdivisions and about 140 potential lots in currently residential zoned areas.

"We only have three years' supply tops, then we are going to be scratching unless there is more rezoning and development," he said.

"With major developments and employment opportunities like the Gracemere Industrial Area and the approvals for several mega mines to the west, Gracemere is about to become the major mining service hub for the biggest mining region in Australia."

Factbox:

Vacancy rate last quarter last year = 11%

Current vacancy rate = 5.77% as of March 13, 2014

Actual number vacant rentals = 85 out of 1472 rental properties

Take up rate last year = over 600 homes were rented

Estimate on vacancy rate by June this year = 2-3% (based on current uptake trends)

Homes being built now in Gracemere = 15

Homes required in Gracemere by 2015 = 190

Originally published as Agent predicts Gracemere preparing for residential boom