Forecasts are dire for investors in mining towns, with predictions expecting the boom to only last for another two years, according to Deloitte Access Economics.
The private-sector budget forecaster predicted in a new report that: “The strong bit of Australia's two-speed economy won't stay strong for more than another two years or so.”
However, Narelle Pearse, CEO at Mackay-Isaac-Whitsunday Regional Economic Development Corporation, told Smart Property Investment that the forecast is inaccurate and investors shouldn’t worry.
“In a word, no,” Ms Pearse said.
“If you have a look at the amount that mining companies are spending on new and expanded mines, plus the investment in port and infrastructure – these are big and smart companies, there is no way they’re investing that kind of money in something that’s going to end in two years.
“Yes, thermal coal has taken a few hits in the past quarter in terms of price, but the long-term demand is still very strong,” she said.
Despite the forecasts, mining towns continue to expand with Queensland’s Mt. Isa the most recent to plan new housing developments.
The council last week began seeking interest from property developers, with a notice online stating that “Mount Isa City Council is seeking expressions of interest to develop a future housing estate in Mount Isa known as “The Gliderport”.
This estate is expected to provide 400 parcels of residential land, a local neighbourhood shopping centre, childcare centre and public open space.”
Ms Pearse added that “we might see a slight flattening out of the market, but based on what’s already sitting there in terms of mines as well as what’s being added to the market, that type of investment will sustain jobs for the next 20 to 30 years.”
The slow down of the mining boom has also been predicted by BIS Shrapnel, as previously reported by Smart Property Investment.