Property booms in mining towns
Mining town housing markets are one of the primary beneficiaries of the resources boom, RP Data’s national research director Tim Lawless has claimed.
According to Mr Lawless, housing markets around the resource-intensive regions are benefiting from strong demand, which is, in turn, driving up transaction numbers and home prices.
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“High levels of demand coupled with a scarcity of quality housing in some mining regions is showing that median house prices are actually higher than many of the most prestigious suburbs in the capital cities,” he said.
“Western Australia’s Roebourne, Port Hedland and Broome Council Areas have recorded the highest median house prices outside of a capital city at $950,000, $775,000 and $660,000 respectively over the year to June 2011.”
In Queensland, the resource-intensive regions of Isaac ($445,000) and Gladstone ($415,000) are showing the highest median house prices of any council region in the state outside of South East Queensland.
Rental yields in most mining towns are well in excess of the capital city averages. The highest indicative gross rental yields of any council region around Australia are found in Port Hedland at 12.7 per cent. Queensland’s Cloncurry and Isaac are a close second and third, returning an average gross yield of 11.4 per cent and 11.1 per cent respectively.
"With the non-rural commodities sector gathering pace, resource-driven regions should continue to prosper.”
However, Mr Lawless warns prospective investors and home owners in these locations that economies with a singular dependency on one given commodity can be risky.
“Any weakness in the resources sector is likely to be reflected within the housing market,” he said.
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