House prices in a handful of Sunshine Coast, Gold Coast and Brisbane hot spots grew by more than an Australian senator’s salary in just 12 months, following a milestone year that saw homes in a quarter of all Queensland suburbs gain more than the annual household income.
New analysis from Domain has revealed house prices in Sunshine Beach, Minyama, New Farm and Hamilton soared by up to 400 per cent more than the average household salary in the year leading up to June, showcasing the incredible strength of the state’s market amid growing fears of affordability.
According to the report, houses in Sunshine Beach on the Sunshine Coast enjoyed a colossal $445,000 annual change in prices – far outstripping the average household salary of $76,976.
In nearby Minyama, houses gained $437,500 to outperform the average income of $70,543 by almost $367,000. In the blue-chip Brisbane suburb of New Farm, house prices rose by $440,000 – a figure that’s four times more than the annual household income of $103,516.
In the unit market, Sunshine Beach also topped the Queensland list while taking fourth place nationally after annual property prices skyrocketed by $212,500 – an incredible $135,000 more than the annual household income. The sunshine state also recorded the highest proportion of units that gained more in price growth than the annual household income, followed by NSW.
While the data might look dire for bargain home hunters, property punters said Queensland remained as cheap as chips compared to most major southern cities, with the gargantuan house price growth attributed to record rates of interstate migration in key lifestyle hot spots.
“What we have seen and what’s very evident for Queensland is the Sunshine Coast and the Gold Coast are very up there, and this data is really telling of who is active in the market,” Domain’s chief of research and economics, Nicola Powell, said.
“But 25 per cent [of suburbs with higher property price growth than salaries] is quite a strong milestone for Queensland … I think in the years leading up to the Olympics we’ll probably see even greater demand for properties there.”
Dr Powell said while the sheer rate of annual price growth appeared extreme in isolation, across the country NSW was the standout performer, followed by Tasmania, Victoria, ACT, Queensland, South Australia and Western Australia.
“What we’d seen in parts of NSW and VIC is some unbelievably extreme rates of growth … and in Queensland 69 per cent of suburbs still had lower rates of growth than the household income,” she said.
Ray White New Farm principal Haesley Cush said while sheer buyer appetite had sent prices soaring in the city’s most sought-after precincts, the fact that a stylish two-bedroom unit could still be snapped up for less than $600,000 in a trendy inner-city patch made Brisbane a gold mine.
“We have had only moderate growth in houses [in the last 10 years] and in units we’ve had negative growth so the fact that some suburbs are outperforming annual incomes is offset by the fact that people’s incomes were beating it in past years,” Mr Cush said.
“And I still think we’ve got a long way to go in terms of values before it starts to hit that big question of, ‘How long can this go for?’”
As to where he’d pour his investment property dollars, Mr Cush said anywhere with major transport infrastructure spending was bound to be a good bet.
“I think generally there are two places you should buy to get your house earning more than you. One is the traditionally good markets like New Farm, Paddington, Ascot and Bulimba – they are going to continue to grow and perform. And then, for people looking for more of a speculation, there are two other areas around the city like Kelvin Grove to the north, because it has big infrastructure changes, and Albion.”
Sunshine Beach Real Estate principal Pip Covell said the sheer lack of stock in her coastal suburb had sent property prices through the roof, with the market flourishing from both interstate buyers seeking a “sea change’ and families and adult children returning home.
“The prices are still increasing. We sold the only block of land left in Sunshine Beach last weekend and it went for $2 million under the hammer … and it’s in a residential area with no sea views,” Ms Covell said.
“You’ve got this backlog of buyers that are just sitting there waiting to pounce and a lot of people want to come and live here … I think it’s this whole thing of people being able to work from home and prices are catching up because of our location and the airport.”
It’s a trend she said had flooded into the apartment market, sparking an incredible year of sales in the unit sector with spacious beachfront units now frequently fetching millions.
Down on the Gold Coast, houses in Bundall, Miami, and Mermaid Beach far outperformed household salaries over the past year, with the unit sector also soaring.
“Interestingly it’s not just … houses – we were seeing that previously when units were stagnant – but we have sold both a house and unit for about $200,000 over what they sold for last year. The shift has been significant,” Harcourts Coastal agent Ben O’Brien said.
“But the market stock is down by less than half typically [and that’s a big challenge].”
In Bundall, the annual change in house prices reached $337,500 over the past year – more than three times that of the annual household salary of $94,899. In Miami, house prices collected $296,250 – which is just over $216,000 more than the average salary.
For units, Currumbin was the star performer with an annual price change of $132,500, compared to the household salary of just over $84,000.
“Southport is where I would put my money right now as it’s still undervalued. I see plenty of growth there,” Mr O’Brien said.
Article Source: www.domain.com.au
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