The Australian property market has been on the boil over the last few months, with house prices smashing records amid renewed investor confidence and strong buyers’ demand. At the cusp of this multi-decade property upswing, the sun-drenched Sunshine Coast has emerged as a shining star of the housing boom.
As per Domain House Price Report for March 2021 Quarter, median house prices in the Sunshine Coast surged by 6.9 percent over the quarter to A$770,000, marking a staggering year-on-year rise of 19.4 percent. It represents one of the sharpest rates of annual house price growth across Australia. A similar trend was reflected in property consultant CoreLogic’s report, which showed the Sunshine Coast dwelling values recorded a 12-month gain of over 11 percent in February 2021.
Speculations are rife that the Sunshine Coast could soon become the priciest place in Queensland to buy a house if property prices continue to grow at the current pace.
What’s Supercharging this Property Boom?
Changed lifestyle preferences post COVID-19 seem to be fuelling interstate buyers’ interest in South-East Queensland’s housing market, accelerating an exodus of Aussies from larger cities towards more peaceful regions. The compelling pull of lifestyle precincts appears to be spurred by the option of remote and flexible working arrangements post lockdown, along with a growing demand for holiday homes and lifestyle-oriented properties.
At the same time, factors such as the Sunshine Coast’s increasing population growth, favourable climate and tremendous control over COVID-19 spread are driving demand for properties in this popular beachside region.
Furthermore, the Sunshine Coast has been drawing significant interest from interstate and offshore property investors on the back of its rising economy, low vacancy rates and infrastructure spending. Over the last couple of years, the apartment development has been moving in full swing in the region, with the airport expansion project adding to its interstate allure. The coast seems to be offering the ideal mix of business vitality factors, presenting investors with multiple opportunities to start new avenues for business growth, expansion, and development.
These factors, along with record-low mortgage rates, seem to have given buyers and investors the perfect ingredients to tap the property market. Meanwhile, at a time when the frenzy of activity in the housing market is at its peak, property supply continues to struggle to match the ever-growing demand, stimulating a rise in property prices.
Is the House Price Party Nearing its End?
Even though there has been substantial growth in the Sunshine Coast’s property prices, the market is still catching up to the average values in major capital cities, like Sydney and Melbourne. It appears that there is more room to run for property prices before they take some breather.
Besides, the economic fundamentals driving the price boom does not seem to be subsiding any time soon. Interest rates are more likely to stay at record-low levels for the next few years, as repeatedly indicated by the RBA. Meanwhile, the recently announced Federal Budget has provided a welcome boost for first home buyers trying to enter the property market, which is expected to keep housing demand elevated for quite some time.
With many of the Sunshine Coast’s property developments offering affordable entry points and excellent positions near the coastline, the market is more likely to see strong housing activity over the coming months. At the same time, a continued influx of new residents seeking lifestyle changes is expected to retain strength in the coast’s housing market in the post-COVID era.
Overall, the current scenario is painting an attractive picture of the Sunshine Coast’s property market, which remains well-positioned to record higher than average levels of demand and strengthening prices.
Mr. Kunal Sawhney, CEO, Kalkine
Kunal Sawhney is the founder and CEO of Kalkine. An accomplished financial professional, he has extensive expertise in equity markets and adopts quantitative and qualitative stock selection practices.