A revival of property prices is expected in some areas of the Gold Coast on the back of billions of dollars of development, according to latest research figures.
The Coomera area and surrounds (Upper Coomera, Guanaba, Maudsland, Oxenford and Wongawallan) has been tipped for potential growth with a $500 million rail line duplication recently added to the $5.2 billion worth of planned and underway development in the area.
“The northern corridor has been the fastest growing area on the Gold Coast for some time and more infrastructure is needed to service that growing population,” said Stewart Gilchrist, Colliers International Gold Coast director.
“It is good to see that there has been a big rise in spending in this sector over the past year, but the rail project is really just a good start. Much more will be needed in the future to cope with the big population growth happening in that area.”
Eleven other infrastructure projects are in the pipeline for the Coomera area, many of which are under $30 million, such as community hubs and schools.
Destiny Financial’s Margaret Lomas told Smart Property Investment that while it’s worthwhile watching the area for long-term growth, there are a few worrying indicators over the short term.
“While the long term prognosis for Coomera, as a fast growing residential area with suitable infrastructure planning, is generally a good one, it’s been suffering an underperformance, which is directly linked to the oversupply.
“Vacancy rates are at around three per cent and trending upwards, and there is a significant amount of established houses on the market, as well as a lot of new developments being released and planned.”
Australian Bureau of Statistics figures show that the Pimpama-Coomera area is the number one growth performer of the Gold Coast, with a 14.1 per cent rise in population per year over five years.
Jean Brown, principal and director of Gold Coast-located Jean Brown Properties, said that on the ground they have started to see the market pick up in the northern areas.
“We have certainly seen an increase in buyer enquiry over the past two to three months,” Ms Brown told Smart Property Investment.
“I don’t think house prices are starting to rise as yet but the volume of sales being made has certainly increased,” she said.
This may also be on the back of the rate cuts throughout the year, which have made investing on the Gold Coast “a much more attractive proposition” with rents remaining steady for the past few years.
Colliers International research manager, Lynda Campbell, said that the development spending is set to continue.
“For some time now the residential sector has had the biggest development spend in the Coomera area, which makes sense because of the population growth,” said Ms Campbell.
“Residential development spending currently accounts for $2.22 billion of the total development spend in the Coomera area, which is more than 40 per cent.”
As a result of this, there’s “no question” this is a growing area, said Ms Lomas, and “one which will have a solid long-term growth”.
However, “don’t expect much price movement in the coming few years and beware of the newer stock, which will more than likely suffer short-term values falls, until the oversupply is worked out of the market,” she said.