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With Queensland’s economy relying on a mix of tourism and mining, the next three years shows promise for regional areas.
The QBE Australian Housing Outlook 2018–2021 report has shown regional Queensland centres are seeing moderately successful conditions.
Across theState, the Gold Coast’s economy is still reaping the benefits from the Commonwealth Games, according to the report.
Additionally, infrastructure projects such as the second phase of light rail construction and the expansion of Jupiter’s Casino has funnelled back through to the local economy.
Past this, various accommodation projects and development of Westfieldis predicted to generate economic activity, but not to the levels seen preceding the Commonwealth Games.
However, the report noted a lull is predicted for after the current work is completed and before the next set of infrastructure projects begin.
Median house prices in the Gold Coast saw a slight rise of 1.6 per cent over the last year to June 2018, while median unit prices declined by 2.4 per cent.
As dwelling finishes are set to peak in 2018, the lack of stock is expected to be filled and will soften prices.
The next three years is expected to see house prices grow by 2 per cent per annum up to $690,000 while units are predicted to see slower growth of 0.8 of a percentage point per year up to $425,000.
Toowoomba has recently seen a slowdown in building activity and unemployment rising to 5.2 per cent due to infrastructure projects completing.
As a result, median house prices in the area have declined by 5 per cent to $380,000.
The Second Range Crossing is the most notable construction project occurring within the area, with the Inland Rail project scheduled for the medium- to long-term.
This project will connect Toowoomba with Brisbane and Melbourne along with other interstate rail networks, and this in part will help push moderate growth for the area with 2.6 per cent per annum forecasted for the next three years.
Experiencing the fastest population growth in financial year 2016–17 of all Queensland population centres with 2.5 per cent, the Sunshine Coast has just recently met housing demand with increased construction works, putting the vacancy rate at 2 per cent.
Over the last year to June 2018, the Sunshine Coast saw better house price growth in both Brisbane and the Gold Coast, rising by 3 per cent.
Conditions over the next three years are likely to be supported through increased tourism and numerous infrastructure projects such as the second stage of the Sunshine Coast University Hospital and redevelopment ofHospital, which is expected to boost the area’s population growth further.
Median house prices are expected to see a cumulative rise of 9 per cent over the next three years to $650,000.
Previously relying mostly on mining, Townsville appears to be reaching the bottom of its cycle with a cumulative decline of 16 per cent over the last eight years, according the report.
As mining investment has dried up, unemployment figures have improved but are currently at 9.1 per cent.
However, construction works picked up last year and will continue to do so through financial year 2018–19, which include the development of the Townsville Integrated Stadium and Entertainment Centre and expansion of Lavarack Barracks.
The worst is predicted to be behind Townsville, as the report expects the median house price in Townsville to rise by 7.8 per cent over the next three years to $345,000, but noted this is expected to occur closer to 2021.
While geographically close to Townsville, Cairns’ reliance on tourism has mean it has seen less severe declines than its mining-reliant regional centre neighbour.
The lower Australian dollar has meant Cairns has appeared as an attractive tourist spot, and the jobs market is seeing an improvement, which are both funnelling back into housing demand.
This demand is recently being met with increased supply, particularly in the unit market, which until recently was seeing a period of undersupply.
Over the last year to June 2018, the median house price has remained stable at $420,000.
While performing better overall than its neighbour of Townsville, Cairn’s future is somewhat subdued.
According to the report, the tourism market is the only main factor influencing Cairns’ local economy, with price growth expected to be a cumulative 3.6 per cent over the next three years to put the median house price at $435,000.