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Shimmering like a beacon, the Gold Coast market has, for many, become a bellwether regarding the health of the Queensland residential market.
So, how is its shimmer?
Some facts first:
<ul>
<li>550,000 permanent residents</li>
<li>Sixth largest urban area in Australia</li>
<li>Growing by 11,000 new residents per annum</li>
<li>For every five people on the coast today, there will be eight within 25 years</li>
<li>One in three properties are rented</li>
<li>Three out of five rental households hold no children</li>
<li>59% of owner-resident households also hold no children</li>
<li>Yet three-quarters of all dwellings have three or more bedrooms</li>
<li>A quarter of residents rent from family or friends</li>
<li>Need to build 5,000 new dwellings each year</li>
<li>Just 2,500 approved last year</li>
<li>Past oversupply now absorbed</li>
<li>Median lot size is now 455 square metres</li>
<li>New detached housing development controlled by a limited few</li>
<li>Very little new housing supplied via small infill builds</li>
<li>310,000 locally employed</li>
<li>New jobs are being created – 5,500 last year</li>
<li>Unemployment is 5.7% but was 7.4% in 2011 and 9.5% in 2001</li>
<li>Average family household income is $77,500</li>
<li>6.2 income to detached house price ratio; 4.1 for attached dwellings and 4.5 for apartments</li>
<li>33% rental income spent to rent a house; 26% for attached dwellings and 28% for apartments</li>
<li>Gross rental yields for houses 4.4%; 5.2% for attached dwellings and 5.1% for apartments</li>
<li>18,000 residential sales this financial year</li>
<li>Our forecast is for 22,000 sales during fiscal 2015</li>
<li>56% moved within last five years</li>
<li>18% from interstate and 16% from overseas</li>
<li>1,200 vacant properties for rent</li>
<li>Vacancy rate is 1.4%, but rising</li>
<li>10,000 resales on market and falling</li>
<li>Rents rose between $10 and $20 – depending on product type – during 2013</li>
<li>$230,000 current median land price</li>
<li>$510,000 detached house</li>
<li>
$375,000 attached dwelling 
</li>
</ul>
But enough showing off.
Some comments
The Gold Coast has just entered a recovery – enquiry is increasing; so, too, is building activity and sales; return of price growth plus improving rents.  In short, a more equal market.
This recovery is likely to be weaker than past ones.  Employment growth, whilst occurring – which is a nice change for the Gold Coast – remains weak and housing affordability relatively low.
Low affordability is forcing many renters and owner-residents to accept more compact housing and within this, dwellings of smaller size i.e. with fewer bedrooms.
We anticipate the strongest residential demand for two and tight three-bedroom stock on the Gold Coast in coming years/decade.  Therefore investors should consider buying compact housing over more traditional detached product.
As for timing – and all things being equal – the Gold Coast should remain in the recovery phase of the cycle this calendar year; entering an upswing in the middle of next year and peaking in mid-2017.
Our work shows that almost all of the price and rental growth that takes place over the full property cycle takes place during its recovery and upswing.
So if you are looking at the Gold Coast as a place to buy a residential investment property, then this year is the time to do something.  Some really good bargains are available.
But investors, in the main, need to limit their expenditure to under $450,000 for resale or second-hand stock and under $550,000 for newly built or off the plan investment stock.
Our forecasts are for attached dwellings – on average – to rise by up to 8% on the Gold Coast over the next 12 to 15 months.  Less price growth is expected for traditional houses and vacant allotments.
At last, the Gold Coast, finally, has got a bit of a shine!
Visit Michael's <a href="https://www.matusik.com.au/" target="_blank">website</a>, read <a href="https://www.matusikmissive.com.au/" target="_blank" rel="nofollow">his blog</a>, follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" target="_blank" rel="nofollow">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" target="_blank" rel="nofollow">Twitter</a>, or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.<a href="https://www.matusik.com.au/" target="_blank" rel="nofollow"> </a>
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michaelmatusik-49YzLvdmNv

The Gold Coast: Is it finally its chance to shine?

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There is a distinct housing cycle.  Much of it driven by things that repeat – liquidity; the economy; rising demand; relative investment returns; scarcity and confidence – but there is always an ' X factor' which builds influence and is often the key ingredient/s that causes imbalance.
But first things first – <a href="https://www.propertyobserver.com.au/australian-capital-territory/despite-auction-heat-dwelling-values-were-tepid-in-february-rp-data-rismark/2014030468153" target="_blank">Australian house price growth has paused</a> (well, at least during February) after rising for eight consecutive months.  House prices are up 9.5% over the year.
I am not surprised, as there are natural limits to any market, regardless as to how strong an influence the 'X factor' is and eventually dwelling prices and rents are determined by the local market’s capacity to pay.
This property cycle – and especially for those Queensland markets entering a recovery or just about to – should have several years to go before reaching a market peak.
But high house price inflation now will see a much quicker market peak and potentially, a larger correction in years to come.  For mine, this Queensland residential recovery should be more about increasing sales volumes and clearing excess resale supply and little to do with price or rent escalation.  Appreciation yes, rampant increases no.
In my presentations of late, I outline that past residential cycles have shown an 8.5% average annual return.  But I also go into some detail to explain why I think the next residential cycle – between now and 2021 – will be much milder - averaging 5% per annum on average.  And this assumes that nothing really unforeseen happens.
I am dourer about the future for several reasons, including the limited impulse of future interest rates; no likely new government assistance packages (i.e. FHOG or NRAS); aging and changing demographics; budget deficits; more frugal governments; geopolitical shifts (the Russian periphery is only part of a wider changing picture); low housing affordability and structural changes to local/overseas employment.
Housing is affordable if you have good equity, a well-paid, full-time job or a well-stocked superannuation fund.  But if you are starting out, or have limited equity, or work several part-time jobs, then Australia’s housing market is very expensive indeed.
Also, whilst jobs are being created, most of late are part-time.  Three out of 10 people are now employed part-time across the country.  Nearly 2 million workers are ‘underemployed’ – meaning they are working but would like more of it.  Things are expensive.  We just got our quarterly energy bill, I am still in stock!
At present, this cycle’s 'factor X' – well it should really be 'factors X' – are having a very inflationary impact.  These include SMSFs' push towards property, Chinese direct and indirect buying, loose FIRB rules and the lower Aussie dollar.
So far this has been largely confined to Sydney and Melbourne.  But many Queensland developers and local agents are doing their level best to attract these influences north.  I wish them luck, as God knows it has been tough making sales over the last five years, but I don't want them to be all that successful.  We cannot afford its inflationary impact.
The graphic below suggests that these influences have already caused Sydney and Melbourne, by and large, to become unhinged for local reality.
Dwelling prices are over or approaching 10 times the disposable family household incomes in both cities. When the music stops – and it always does – then values must fall in both cities.  At best, values would plateau for a very long time.  Think five years.  Maybe 10.  It happened in the late 1980s.  History seems to repeat.
<img alt="matusik_march_4_one" height="353" width="470" src="/images/stories/2014/03/04/matusik_march_4_one.png"> 
You see, interest rates will eventually rise, Chinese interest will wane, changes may happen to SMSFs or FIRB or the dollar will stabilise/increase.  Worse still would be a hiccup or two regarding employment.
Both Sydney and Melbourne have now painted themselves into a corner, so to speak.  Price-wise, there is very little wriggle room.
I do hope the current pause in house prices continues.  I wrote late last year that values in both Sydney and Melbourne could fall this year.  If they don’t pause, then both cities face a serious correction.
As for South East Queensland (SEQ), well I am writing this much earlier than I anticipated, too.  I pencilled in this type of post for later this year, even early 2015, as it was at that stage that I anticipated the term “irrational exuberance” might best describe the local market’s general mindset.  But alas, I am covering this now.
Many I talk to - which is quite wondrous really, as only three months ago these same people described the local housing market as "dead" - are in a mad rush to buy something.  Anything.  They just don't want to miss out on the price rush.
True, SEQ price points are much lower than Sydney’s, Melbourne’s and even Perth’s.  SEQ’s gross rental returns are also higher, especially at present, at least for attached product.  Yet current dwelling prices are already at 6.9 times earnings in Brisbane.  Vacancy rates – especially in inner Brisbane – are already starting to rise.
The state has been through a lot in recent years, much of it bad from an economic point of view.  SEQ cannot stomach a run on dwelling prices like we have recently seen in Sydney and Melbourne.
Asset appreciation of between 5% and 8% over the next 12 months, with a smaller price/rent top-up during 2015, would be welcome.  Anything beyond that – for mine – is potentially breaking the bank.
I would be joining the chorus if Queensland's dwelling price to household income ratio was lower.  But it isn't.  We come a distant third, some will argue, fourth behind Perth, when it comes to international buying interest.  Interstate migration is very low these days to Queensland.  This might change, as southerners are forced out of Sydney and Melbourne.  But we need jobs to attract this movement.  A warm climate alone these days isn't enough.  Our dwellings, whilst still cheaper than Sydney and Melbourne, aren't as cheap as they once were.  Well not cheap enough for some to sell-up and take a punt in sunny Queensland.
Slow price/rent growth, much more sales and thereby reducing resale supply - now that’s want we need over the next couple of years.  A mild cycle, not a rampant one.
I hope I am right.
Michael Matusik is the founder of <a rel="nofollow" target="_blank" href="https://www.matusik.com.au/" style="font-size: 14px;">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a rel="nofollow" target="_blank" href="https://www.matusikmissive.com.au/">Michael’s Blog</a> or follow him on <a rel="nofollow" target="_blank" href="https://www.facebook.com/ThinkMatusik?fref=ts">Facebook</a> and <a rel="nofollow" target="_blank" href="https://www.twitter.com/michaelmatusik">Twitter</a> or connect via <a rel="nofollow" href="https://www.linkedin.com/in/michaelmatusik">LinkedIn</a>.
                                   
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What's going to be the 'X factor' in this property cycle?

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Every second new home built today is attached – either a townhouse, villa, ‘plex’, flat or apartment.
Just 56% of the new dwellings approved during 2013 were detached houses.  It was 73% just five years ago.
One in four new dwellings approved are now in mid to highrise apartment towers.
Is this a fundamental shift?
<img alt="matusik_feb_13_one" height="627" width="470" src="/images/stories/2014/02/13/matusik_feb_13_one.png">
What the stats say
The graphic shows that there has been a rapid drop in new detached housing approvals in recent years.  In contrast, there has been a big lift in the number and proportion of mid-to-highrise apartments approved across the country.  There has been little real change in the level of new townhouses or low-rise unit construction.
Australia’s new housing market is now quite polarised between detached homes and apartment towers.
The cost to actually supply a new detached house (excluding land, taxes/charges etc.) is now similar to the cost to supply a new apartment.  It is considerably cheaper to supply a new townhouse or walk-up flat.
Of course, the size of a new house is much larger than a new apartment, with the average cost to build a new project home somewhere around the $1,000 per sqaure metre mark.  The cost to build new mid-to-high-rise stock sits at somewhere between $2,500 and $3,000 per square metre (as a ballpark figure).  It costs about $1,500 per square metre to build a new townhouse or basic walk-up flat.
Most new townhouses are three bed, two and a half bath, with two cars.  Many of the new walk-up flats are in two bed/two bath (with car parking) arrangements.  Many of the new mid-to-high-rise apartments are under 85 square metres and increasingly, one bedroom product.  New detached houses, by and large, remain three or four bedroom affairs.
Current demographic trends strongly suggest the need for more two and three-bedroom attached product.
<ul></ul>
My opinion
We seem to be stuck in the house versus apartment tower mindset.  This is especially the case in Queensland.
The recent changes to the Brisbane Town Plan further push this building form, i.e. traditional suburbia versus mid- to highrise density around select urban nodes.
What is missing – from an affordability and liveability viewpoint – is new housing product in-between.  We need more townhouses, ‘plexes’, terrace homes, granny flats, small lot homes and flexible dwellings.  These need to be supplied across much of the Australian fabric and especially in our middle-ring suburbs.
For mine, we also need one set of rules when it comes to new housing form.  This should apply across an entire state or territory.  Maybe it should even apply across the country, allowing of course for climatic differences.  It is all well and good that Ipswich City Council now permits granny flats.  But why not Brisbane?  Why does Adelaide – yes Adelaide - permit a much finer grain of new housing choice than Brisbane?
Our experience is that many residents want to ’age in place’.  Most don’t want to live in a highrise apartment complex.  They would like to downsize, stay local and have some nexus to the ground. But in the absence of affordable choice, they stay put, often as a couple in large detached homes.
This ‘in-between’ housing would also suit many first home buyers.
There is a real lack of new housing choice in the Australian market.  This is stopping first home buyers.  It is stopping empty-nesters from downsizing.  It is, by default, oversupplying the new high-rise apartment market and stalling detached housing supply.
Public policy is not allowing private enterprise (developers and builders) to supply what the market wants.
Is this a fundamental shift?
Yes.
But the role of the developers and builders is to respond to opportunities and work within planning frameworks (as dysfunctional as they might be) to deliver a product that sells.
The opportunity is that Australians, by and large, want more compact housing.  They are trading ’space’ for ‘place’.
The trouble is that this demand is largely being forced into one new product type – high density apartments.
Many buying this product anticipate strong capital gains and high rental returns.  On paper everything looks rosy. In reality, investment outcomes will be determined largely by supply.
For mine, we are now in danger of oversupplying the mid to highrise apartment market.
And sadly, within this mid to highrise space, apartment choice is increasingly limited.  It’s a race to the bottom – the smaller the better (read cheaper); or as the spin goes, “cheap and cheerful”.
Opportunity to supply a range of new housing types would reduce this propensity to overproduce, reducing the severity of the property cycle.
Michael Matusik is the founder of <a rel="nofollow" target="_blank" href="https://www.matusik.com.au/" style="font-size: 14px;">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a rel="nofollow" target="_blank" href="https://www.matusikmissive.com.au/">Michael’s Blog</a> or follow him on <a rel="nofollow" target="_blank" href="https://www.facebook.com/ThinkMatusik?fref=ts">Facebook</a> and <a rel="nofollow" target="_blank" href="https://www.twitter.com/michaelmatusik">Twitter</a> or connect via <a rel="nofollow" href="https://www.linkedin.com/in/michaelmatusik">LinkedIn</a>.
 
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Rush to produce high density apartments is a race to the bottom, and we're risking oversupply

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New dwelling starts are, well...starting.  Approvals are near all time highs.  Actual commencements are on the rise.
The Australian economy is now at a stage where offsets to the downturn in mining capex are starting to come through.
It's great news (for now).
 <img alt="matusik_feb_10_one" height="353" width="470" src="/images/stories/2014/02/10/matusik_feb_10_one.jpg">
<img alt="matusik_feb_10_tweo" height="353" width="470" src="/images/stories/2014/02/10/matusik_feb_10_tweo.jpg">
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/02/dwelling-starts-1.jpg"></a>
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/02/dwelling-starts-2.jpg"></a>
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/02/dwelling-starts-3.jpg"></a>
<img alt="matusik_feb_10_three" height="353" width="470" src="/images/stories/2014/02/10/matusik_feb_10_three.jpg">
New dwelling approvals are close to a high point in Australia.  Dwelling commencements totalled 165,000 last year.  They are expected to reach 180,000 during 2014.  This is much higher than the 150,000 annual average over the last seven or so years.  This lift in new housing starts - my boffin friends tell me - will add significantly to the country's economic growth.  In short, more jobs.
The lift in new housing approvals is across most states and territories.  Victoria is coming off a very high base.  Tasmania has little need to build much, given its low population growth.
One chart that reads best if the lines head down is our 'dwellings yet commenced' graph.  The lines are now heading in the right direction.  Only one in 10 detached houses approved across Australia have yet to start construction.  This ratio is one in five for apartments and townhouses.  These ratios are dropping.  All smiles.
It takes, on average, about three months from approval to start building a detached house in Australia.  About five months for a townhouse, nine months for walk-up flats and 18 months for mid to highrise apartments.  Sadly, it takes years, more often than not, to actually get a new development approval. But enough whinge.
Dwelling prices are on the rise, up 10% over the last 12 months.  Australia's two largest cities are mostly driving this growth.
House price growth - despite <a target="_blank" href="https://www.propertyobserver.com.au/news/property-crash-is-like-popping-popcorn-especially-in-melbourne-harry-dent/2014020567560">Harry Dent's recent efforts</a> - is not showing any signs of slowing down.  And really, why would it?  Strong population growth, very low-interest rates (so far), an undersupply of stock and an expectation of further house price appreciation are fuelling demand. 
Yes, I do think that there is an element of 'irrational exuberance' now taking hold in Sydney and even Melbourne.  It may even find its way up north to South East Queensland by the end of this year.  We haven't had a party up this way for yonks and we look forward to a bit of cheer.
Until new dwelling supply now starts to respond - i.e. dwelling commencements rise in line with approvals - then upward pressure on dwelling prices will remain whilst interest rates are low.
An increase in new dwelling supply is now coming.  Given this trend, interest rates are now likely to remain steady.
<ul></ul>
History has a way of repeating - hence there is a property cycle - and this coming lift in new housing supply (which is great for job creation and actually housing people) will most likely peak when interest start to rise.  These twin lifts will see the housing market soften.  But for mine, that is some 18 to 24 months away.  And the 'soft' should be nothing like a fall of 30% to 50%!
Michael Matusik is the founder of <a style="font-size: 14px;" href="https://www.matusik.com.au/" target="_blank" rel="nofollow">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition. 
Read <a href="https://www.matusikmissive.com.au/" target="_blank" rel="nofollow">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" target="_blank" rel="nofollow">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" target="_blank" rel="nofollow">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
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Lift in dwelling approvals and commencements is great news... for now

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The recent inflation numbers sent the Aussie dollar up and saw most economists advise “forget anymore interest rate cuts”.
But you should never get too carried away with a one-off figure.  It is trends that count.  Also understanding the reasons behind the figures helps.
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/01/CPI-1.png"></a>
 <img alt="matusik_jan_31_one" height="353" width="470" src="/images/stories/2014/01/31/matusik_jan_31_one.png">
 <img alt="matusik_jan_31_two" height="352" width="470" src="/images/stories/2014/01/31/matusik_jan_31_two.png">
 <img alt="matusik_jan_31_three" height="352" width="470" src="/images/stories/2014/01/31/matusik_jan_31_three.png">
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/01/CPI-2.png"></a>
Domestic inflation surprised on the upside.  Yet it remains well within the RBA target range of between 2% and 3%.  At present the cash rate is 2.50%.
Housing-related things drove much of the recent inflation result.  This was followed by food; recreation and transport.  Much of the housing inflation has come from taxes, charges and utility bills.  Also, recent house price rises (measured here via new dwelling sales excluding land) factor in.  Fruit and vegies went up due to the weather; holiday travel/accommodation prices rose as did the cost of petrol.
A significant component of the current inflation was due to the government tax increases including the carbon tax.  Using housing as an example – property taxes and charges rose 7.9% last year; the cost of water/sewerage rose 9.3%; the price of electricity lifted 6.3% and the cost of gas/other household fuels went up 5.6%.  Remember CPI, overall, was just 2.7%.
Interest rates remain low.  The standard variable rate is below 6%; discounted rates below 5%.  Three-year fixed rates remain well below the standard variable rate averaging 5.3%.  But fixed rates are now rising, up from 5.1% three months ago.
All long-term rates now exceed the cash rate.  A year ago the opposite existed.  At the time of writing, the 90-day bank bills were around 2.6% and 180-day bills 2.64%.  Three-year government bonds were 2.96% and ten-year Aussie bonds 4.24%.
<ul></ul>
So interest rates look set to remain benign for some time to come.  But are they low enough?  Again, I think no.  Inflation is tame.  In fact, much of the current inflation is caused by unnecessary taxes and charges, which are helping stop consumption and lowering consumer confidence (which fell last week).  Lower interest rates would help.
Yet maybe now (or soon) is the time fix your interest rates.  I would like the talking heads to be wrong on this one (no more rate cuts) but I doubt it.
Michael Matusik is the founder of <a style="font-size: 14px;" href="https://www.matusik.com.au/" target="_blank" rel="nofollow">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a href="https://www.matusikmissive.com.au/" target="_blank" rel="nofollow">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" target="_blank" rel="nofollow">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" target="_blank" rel="nofollow">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
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Lower interest rates would help, but I doubt we'll get them

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House prices have been rising.  But the rises are not uniform across the country.  The current recovery is against a period of relative weakness in house prices.
The housing market in Australia is quite cyclical, influenced by broad economic factors and in particular the cost and availability of money.  Low interest rates and easier credit access could drive the current cycle too high.
At present, price <a href="https://matusikmissive.com.au/2013/12/18/2014-outlook/" target="_blank">levels</a> (outside of Sydney, Melbourne and to some degree Perth) whilst above those in the US and Europe, are at the upper end, not beyond, the range of price to income ratios for developed countries.  At present, arrears rates on housing loans remain relatively low in Australia.
<img alt="matusik-jan-21-one-small" height="349" width="470" src="/images/stories/2014/01/21/matusik-jan-21-one-small.gif">
<img alt="matusik-jan-21-two-small" height="310" width="470" src="/images/stories/2014/01/21/matusik-jan-21-two-small.gif">
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/01/House-prices-1-PNG.png"></a>
<a href="https://matusikmissive.com.au/wp-content/uploads/2014/01/house-price-2-PNG.png"></a>
The two graphics show that:
<ul>
<li>
House prices are cyclical.  Gains made now and into 2014 and 2015, could be eroded if prices grow too fast over the next 12 to 18 months.  Some of the current price forecasts (15% to 20% for 2014 alone)  will mean, if they eventuate, a potentially big slide in prices come late 2015 and beyond.  There is really little wriggle room for house prices to move.  Something in the order of 5% to 8% over the next 12 to 18 months is, for mine, much more viable.   Again for mine, if price growth exceeds, say, 10% this year, then budget on price falls post mid-2015.
</li>
</ul>
<ul>
<li>
Not all capitals are enjoying the rush.  Some haven't seen any improvement really in house prices yet.  Everything is Sydney, Melbourne and Perth and some locations (like every other cycle) will miss out.  I cannot see Hobart, Adelaide, Canberra or even Darwin enjoying much house price growth this year.  In contrast, South East Queensland is in the box seat.  Perth is likely to slow.  I also think that Sydney and Melbourne will see price growth this year, but they are already 'over cooked'.  Both markets can expect a correction - and maybe big ones - in late 2015.
</li>
</ul>
<ul>
<li>
With stubborn, high unemployment, full-time job losses and benign inflation - and despite its inflationary impact on house prices - interest rates need to fall further.  The collateral damage will be an overheated house price cycle.  This is why house prices cycle.
</li>
<li>
What will stop this current cycle is any rise in interest rates and an increase in mortgage defaults (which will lead to tighter lending practices).  Care must be taken not to borrow too much.
</li>
</ul>
Michael Matusik is the founder of <a rel="nofollow" target="_blank" href="https://www.matusik.com.au/" style="font-size: 14px;">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a rel="nofollow" target="_blank" href="https://www.matusikmissive.com.au/">Michael’s Blog</a> or follow him on <a rel="nofollow" target="_blank" href="https://www.facebook.com/ThinkMatusik?fref=ts">Facebook</a> and <a rel="nofollow" target="_blank" href="https://www.twitter.com/michaelmatusik">Twitter</a> or connect via <a rel="nofollow" href="https://www.linkedin.com/in/michaelmatusik">LinkedIn</a>.
 
 
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Overheated markets set to see a 2015 correction

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Two out of five houses sold to investors last year in Queensland.  Investor interest in townhouses and apartments is much higher, with seven out of 10 townhouses selling to investors and 85% of apartments being sold to non-residents.
Sales to investors are up on 2012, by about 10%.  During 2014 they will get even higher.
This article outlines where most of the investment buying has been taking place across Queensland.
Houses
Most houses in Queensland - like the rest of the country - are purchased by owner-residents.  Investor interest is highest in mining-related regions and in resource-based towns.  Investment interest remains high in those areas, albeit at a lower level than in previous years.
Investor interest - so far this cycle - has been more limited in the south east corner of the state than in Queensland's regions.   This is a trend that is somewhat consistent across townhouses and apartment sales as well.
<img alt="matusik-dec-5-one" height="333" width="470" src="/images/stories/2013/12/05/matusik-dec-5-one.png">
Townhouses
More townhouses sell to investors than to owner-residents.  A trend which is not only evident in off-the-plan/new townhouse sales, but also for resales too.
Owner-resident interest does increase at resale, but only if the townhouse complex has certain features.  These include:
<ul>
<li>
three- or four-bedroom product
</li>
<li>
ensuites
</li>
<li>
off-street parking for two cars
</li>
<li>
private courtyards
</li>
<li>
duplex arrangements
</li>
<li>
smaller complex
</li>
<li>
well located
</li>
<li>
acoustically proofed i.e. limited road traffic noise
</li>
</ul>
The owner-resident interest in townhouses is highest in the south-east.
Townhouse living is becoming more popular in Brisbane and on both the Gold and Sunshine Coasts.  Townhouse development is expected to increase, at the expense of new house/land, across South East Queensland in coming years/decades.
Think townhouses, more maybe, than apartments.
<img alt="matusik-dec-5-two" height="329" width="470" src="/images/stories/2013/12/05/matusik-dec-5-two.png">
Apartments
There is more consistency across Queensland when it comes to apartment sales to investors.  The vast majority of Queensland apartments sell to investors.  The Queensland apartment market is driven by investment selling.
Reflecting the recent market downturn, investor interest in apartments was lowest on the Sunshine Coast and in Cairns and Townsville last year.  In was much lower on the Gold Coast (in 2011 and 2012) than the chart below suggests.  Given the rock-bottom prices being offered for Gold Coast apartments in recent years, it is little wonder that investment interest has increased.
Owner-resident interest is there for resale apartments, but not to the same extent as townhouses or detached homes.
Apartments that attract the most owner-resident resales usually are:
<ul>
<li>
in small complexes
</li>
<li>
have high quality - the <a target="_blank" href="https://matusikmissive.com.au/2012/09/18/four-fs/">four Fs</a>
</li>
<li>
in an established neighbourhood
</li>
<li>
similarly sized (within the same development)
</li>
<li>
on a unique site - view, aspect, height
</li>
</ul>
<img alt="matusik-dec-5-three" height="335" width="470" src="/images/stories/2013/12/05/matusik-dec-5-three.png">
<ul></ul>
Comments
For mine, too much property is still being sold to investors across many parts of Queensland.
The longer term averages are 30% for houses; 65% for townhouses and about 75% for apartments.
Yet, we will see more investment selling of Queensland property as the residential recovery gains more momentum during 2014 and 2015.
Investors should be wary of buying in a project or location which is seeing a lot of investment selling.  There is only so much rental market to go around.
Investors also have a better chance of getting a better <a target="_blank" href="https://matusikmissive.com.au/2013/06/05/what-makes-a-good-investment-2/">resale</a> if the dwelling has owner-resident resale appeal.
Sadly, a lot of Queensland's new residential projects of late, don't.

<hr>
Michael Matusik is the founder of <a href="https://www.matusik.com.au/" rel="nofollow" target="_blank">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.  
Read <a href="https://www.matusikmissive.com.au/" rel="nofollow" target="_blank">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" rel="nofollow" target="_blank">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" rel="nofollow" target="_blank">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
 
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Investors are taking too large a slice of the Queensland property market

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So what is happening with vacant land sales across urban Queensland?  You don’t read a lot about the land market these days – it’ all houses this and apartments that.
So are land sales heading north?  In what direction are land prices going?  Have house and land package prices increased?  What about lot sizes – are they still shrinking?
Sales volumes
For the most part, vacant land sales and the sale of house and land packages across Queensland continue to trade at volumes less than the year before.
The biggest falls over the past year have been seen – not surprisingly – across regional Queensland.
The most notable falls in land sales were recorded  in Mackay, Whitsundays, Central Highlands, Townsville and Gladstone.
Land sales have increased in Cairns, Sunshine Coast, Redlands and in Brisbane.
Cairns sales are up because of insurance hikes due to recent weather events, which have increased the cost of body corporate fees.  New house and land product – on free-hold title – are taking sales away from the apartment and townhouse markets in Cairns.
Since the federal election, land sales have improved, so too the sale of new house and land packages, but across most Queensland markets, this recent lift in sales is still below the volumes traded in recent years.  Things are improving.  But it will take a consistent lift in sale volumes to get back to longer term averages.
Land values
Land value movement across the state results in a somewhat mixed bag.
For example, Cairns land prices have dropped by $77 each week or down $4,000 compared to last year.  Most vacant land is priced around $169,000 in Cairns.  The reason for the drop is because land size has decreased, along with the size of the actual new house being supplied.  This is to help capture the townhouse investment market and to cater for the more traditional townhouse/apartment tenant.  The average lot size in Cairns is now 600 square metres.  The typical new house and land package costs $385,000, down $14,000 or $270 per week on last year.
Land values have also fallen in Gladstone, in and around Hervey Bay, on the Sunshine Coast, Gympie, in Brisbane and the Whitsundays.
Average lot sizes have shrunk in most locations; so whilst the overall land price has fallen, the rate per square metre of the land sold continues to rise.  For example, in Brisbane it typically costs about $700 per square metre to buy residential dirt, and yet, whilst overall land prices dropped about 7% last year, the rate per square metre increased by about $50.
Land values rose in Mackay, Issac (Clermont, Dysart and Moranbah) – in fact up by 17% or $21,000 to $145,000 for a 600 square metre allotment, in Rockhampton, on the Gold Coast (wow, now you are rocking the boat), in Logan, Toowoomba and across the Western and Southern Downs (Dalby, Warwick etc.)
Article continues on next page. Please click below.
 
<hr class="system-pagebreak">
More statistics
The most expensive allotments for sale are in Brisbane ($295,000 per allotment), followed by Redlands ($264,000), Gold Coast ($240,000) and the Sunshine Coast ($235,000).
The cheapest dirt is around Warwick ($110,000), then Gympie ($119,000), Lockyer Valley (Gatton/Laidley) ($130,000) and Bundaberg ($144,000).
Typical new house and land packages (being three or four bedrooms; two bathrooms and double garage – usually sized between 200 and 250 square metres) range from $545,000 in Brisbane to $235,000 in Gympie.
17 out of Queensland’s 25 larger urban municipalities have land typically priced under $200,000, with 10 locales having a median land value under $150,000.  Nearly all Queensland municipalities have new house and land packages available under $400,000, some of which are located in South East Queensland and in key regional markets.
New housing of this nature isn’t unaffordable in Queensland.
Finally, the typical allotment across urban Queensland ranges in size from 424 square metres in Brisbane to 1,714 square metres in the Scenic Rim (old Beaudesert Shire).  Gone are the days of the traditional 800 square metres allotment.  Only four Queensland municipalities have a wide choice of vacant land over 800 square metres.
All locations, except the Scenic Rim, have seen allotment sizes fall in recent years.  Some have fallen by up to a third in size over the past five years.  Higher taxes and charges, plus centralised control of the subdividable land stock by a handful of major developers are behind this trend.  There is a demand for more convenient lot sizes, but this demand is highest in more central locations.
Two suggestions
I believe the Queensland land-based market would be stronger (i.e. more sales) if there was more variety on the market.  Importantly, this includes an increase in lot sizes; wider frontages and the clustering of smaller allotments around parks and the like and away from larger homes/bigger allotments.  In other words, less salt’n’peppering of small lots through an estate.
Our polling suggests that potential buyers are put off by the mixture of housing lots throughout the estate.
Another thing which would help make more sales would be for more turn-key product on the market.  A turn-key property is one which is complete and ready to move into on completion.  Everything, except furniture, is installed.
Whilst there has been a lift in the proportion of turn-key sales across the state – with one in ten land-based sales being turn-key in nature last year (up from 8%, three years before) – this trend is largely confined to the south east corner of the state.  The proportion of turn-key sales in Brisbane is 30%, 18% in Logan, 15% on the Gold Coast and Redlands, 13% in Hervey Bay and 11% in the Moreton Bay area, north of Brisbane.
Outside of Cairns – 11% – the regionals are not offering as much turn-key options to buyers as maybe they should.  In today’s world, buyers are looking for convenient and immediate housing solutions.  The traditional house building process has diminishing buyer appeal.
 
<hr>
 Michael Matusik is the founder of <a href="https://www.matusik.com.au/" rel="nofollow" target="_blank">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.  Read <a href="https://www.matusikmissive.com.au/" rel="nofollow" target="_blank">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" rel="nofollow" target="_blank">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" rel="nofollow" target="_blank">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
 
 
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House and land packages need to offer more variety to appeal to buyers

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The tipping point between caution and optimism has finally passed.
It is often a fine line, but sometime in the past six weeks it has gone from dark to light (well, lighter) when it comes to residential real estate across South-East Queensland.
Property cycle
There is an eight year property cycle – yes, the text books talk about seven years – but the Australian statistics suggest it lasts about <a target="_blank" href="https://matusikmissive.com.au/2013/03/19/why-does-property-cycle/">eight years</a>.  But what’s one more year between friends.  Usually, it is five years of good and three years of, well…not so good.
But for more than five years, South-East Queensland real estate has been subdued to say the least.  The 2008 financial knock-down began a slump that was prolonged by deluges, cyclones and domestic political uncertainty.
But now it looks like South-East Queensland has just started to enter its growth phase.  It is likely to be growth this time round, not GROWTH!  But we are going to the black side of the ledger and finally leaving the red.  About time!
Sales volumes
Sales volumes are up across South-East Queensland for the first time in years.
When looking at detached house sales for the last 12 months: 
<ul>
<li>
Sunshine Coast                   5,800 sales     (up 26% on year before)
</li>
<li>
Moreton Bay                       6,650 sales      (up 21%)
</li>
<li>
Brisbane City                      16,000 sales    (up 14%)
</li>
<li>
Redlands                               2,600 sales      (up 23%)
</li>
<li>
Gold Coast                            6,500 sales      (up 22%)
</li>
<li>
Logan                                     4,000 sales      (up 18%)
</li>
<li>
Ipswich                                  2,800 sales      (up 12%)
</li>
<li>
Lockyer Valley                   526 sales           (up 29%)
</li>
<li>
Toowoomba                         3,250 sales      (up 25%)
</li>
</ul>
When it comes to apartment sales, they are also up – 27% on the Sunshine Coast; 3% in Brisbane (apartment sales in Brisbane have been rising for two years now, with today’s volumes up 19% on 2011 figures)and up 20% on the Gold Coast on last year.
Townhouse trading is also increasing, quite quickly in fact, up 49% on the Sunshine Coast (it must be all that new Kawana infrastructure, hey <a target="_blank" href="https://matusikmissive.com.au/2012/03/07/kochie/">Kochie!</a>); up 20% in Moreton  Bay (Caboolture; Pine Rivers and Redcliffe); up 23% in Brisbane; up 27% in Redlands; 17% on the Gold Coast and 22% in Logan.  Falls in townhouse sales are still occurring in Ipswich and in Toowoomba.
Increasing prices
End prices are also starting to rise across South-East Queensland.  Price rises always lag sale volumes.
When looking at typical detached house prices for the last 12 months: 
<ul>
<li>
Sunshine Coast                   $453,000        (up 4% on year before)
</li>
<li>
Moreton Bay                        $390,000       (up 3%)
</li>
<li>
Brisbane City                       $520,000        (up 4%)
</li>
<li>
Redlands                               $455,000         (up 4%)
</li>
<li>
Gold Coast                             $490,000        (up 6%)
</li>
<li>
Logan                                      $353,000         (up 1%)
</li>
<li>
Ipswich                                   $298,000        (up 2%)
</li>
<li>
Lockyer Valley                    $290,000        (up 4%)
</li>
<li>
Toowoomba                          $327,000        (up 10%)
</li>
</ul>
A similar trend can be seen for apartment and townhouse sales across the south east corner of the state.
The entry-level market - up to $500,000 (oh, and how it is so easy to dismiss half a million bucks these days) – is quite strong and occupies a large part of the price bell curve.  There is still a lot of property priced under $250,000 across Queensland, and even in the more populated and relatively expensive South-East.
Sydney leads
Traditionally, South-East Queensland lags the southern markets, following behind Sydney by about 18 months and when their market is moving, then twelve months behind Melbourne/Victoria.
Investors (and some residents) are forced out of the southern markets.  I read that Sydney’s current median price is $690,000 and BIS Shrapnel are predicting it to exceed $800,000 within the next three years.
I recently suggested at a housing conference presentation that the Brisbane (region) median detached house price could reach something like $530,000 over a similar time frame (mid 2016).  Many in the room smirked, some even guffawed.   Today, the middle price across the Brisbane region is about $450,000.  So $25,000 or a 5% gain per annum over the next three years, doesn’t seem that unrealistic to me.
More jobs
Anyway, that is really academic for now.  In order for South-East Queensland to experience such price growth, more jobs need to be created in Queensland.  Whilst investors will follow potential, interstate migrants move because of work first; cheaper housing second and a distant third, because of our warmer climate.
Whilst mining is holding up somewhat better than many expected (for now) and gas, tourism (somewhat) and agribusiness is helping Queensland’s economy, new housing construction, as we pointed out last week, is the missing ingredient.
Easier housing construction means more jobs.  More jobs mean more interstate migrants, which will lead to more sales and higher end prices.
The South-East Queensland market during 2014 depends on one thing - new jobs.

<hr>
Michael Matusik is the founder of <a style="font-size: 14px;" href="https://www.matusik.com.au/" target="_blank" rel="nofollow">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a href="https://www.matusikmissive.com.au/" target="_blank" rel="nofollow">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" target="_blank" rel="nofollow">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" target="_blank" rel="nofollow">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
 
 
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Back in the black: Things are finally looking up for South-East Queensland

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Hope you enjoyed the Melbourne Cup.  It signals the end of the official property year.  Time to rest until Australia Day.  What a great industry to work in; three months off at this time of year and usually two weeks over Easter too.
We work so hard.  We deserve it.  It would be even better if it wasn’t for some elephants in the room.
Hard yards
I keep on reading about how strong the residential market is.  It might be for second hand stock, but then I suspect only in certain locales and for specific price points.
But when it comes to new sales, it is still very much ‘hard yards’.  I think it will remain so – outside of Sydney – for some time to come, if not for this entire cycle.  For mine, much of Sydney’s recent momentum in their new residential market was more due to the change in NSW stamp duties and first home buyer grants than anything else.
There is very little urgency elsewhere and for good reason.  New property often does not offer value in the buyer’s eyes.  Many new projects miss the mark; there is plenty of choice and whilst net returns (rent, less maintenance and depreciation) have been pretty good for new investments in recent years, there has been very little price growth in recently built new housing.  Even in boutique projects, price growth has been lacklustre.
True, new sales have picked up since early September – but that feels like pent-up demand (as many waited until after the federal election to buy).  Looking forward, new sales will be harder – especially this summer.
Buyers are easily spooked and every new sale is hard fought.
And property reporting isn’t helping matters. 
As we noted <a target="_blank" href="https://matusikmissive.com.au/2013/09/24/hot/">a few weeks back,</a> there are a lot of misnomers about price growth, with new builds, renovation activity and the actual way the statistics are compiled affecting the results.
For example, do you really believe that unit prices fell by 30% in Molendinar (Gold Coast suburb) over the last year?  Molendinar is apparently the second worst ‘performing’ suburb in Australia.
But when looking at actual resales – not changes in median values – no such drop occurred.  In fact, attached property values (based on resales) actually rose by 2.1% in Molendinar over the last 12 months.  This rate of growth isn’t much to write home about, but it is world away from a 30% drop in ‘value’.
By the way, there are 864 building units in Molendinar, about a third of which are commercial premises, many semi-industrial in nature.  Several of the 50 ‘residential’ unit sales reported last year in Molendinar – as part of 30% fall in values – were actually industrial sheds and not residential property at all.
These lists are now getting out of hand.
This is the first elephant in the room.
Everyone in the industry needs to start questioning the actual data being pumped out.
But I suppose that would require a bit of property knowledge and a tad more work than regurgitating the press release.  Nearly everyone producing such lists either has an agenda or (sadly) it isn’t worth their time and effort to clean up the results.  Doing so would be counterproductive after all - as few markets actually behave so erratically and where is the fun and media release in that?
Oh, and don’t you love the reasoning real estate agents give when it comes to explaining such wild leaps and bounds.  My favourite goes something like this: “That’s because there is better value elsewhere, come look at what I have listed for sale”.
How about we start questioning these lists and those producing them much more?  I will bet you that nine out of 10 times they are incorrect and nothing like that is actually happening in those locations that seem to make the ‘hot’ or ‘crash’ lists.  Yet many novice buyers take them as gospel.
And why aren’t we making such comments in the press?  Sure, we get asked, but I always ask to see the list first.  Sadly, the data is often embargoed so we refrain from commenting.
Sniper bait
For every new sale settled, two actual sales are actually made.  Often, more work goes into the ‘sale’ that falls over than the one that sticks.  That is the nature of selling new property.  It has always been the case.
Selling something new – often off-the-plan - via a few simple tools like a building model, reports, brochure and feature board – is quite difficult.  Many buyers get cold feet, as they cannot visualise what they are actually buying.
But today there is another problem.  Seemingly solid deals are being killed by deflection.  Those doing the deflecting are often those whom buyers trust the most – their account, solicitor or even financial advisor.
Investment sellers get a bum rap.  They are the sharks in the pool.  But at least they come at you front on.  It’s the professionals – those one or two steps removed from the sales process – who have the sharpest teeth and largest appetites.  And most of the time, you don’t seem them coming.
Let’s use a recent real example to illustrate.
A young resource worker is advised by this father to stop wasting his money and invest some of it.  An appointment is made to see a financial adviser.  The advice is to buy a residential property.  A new property is found – independently by the young gun – contracts signed, deposits paid and off to the accountant the contract goes.  The accountant heavily suggests that the said investment is a poor one and that a better investment would be to buy into project X.  This advice is taken – as the accountant is trusted and it is assumed should know about such things – the first contract is ripped up and a dwelling in project X is bought.  The buyer isn’t aware of the $10,000 kickback the accountant got for the sale.
This is another – if not larger – elephant in the room.
This, of course, doesn’t apply to the vast majority of property professionals but it is happening out there.  It is very hard to make a new sale when there are so many snipers in the trees.
If we are going to have a Form 27c in Queensland, then let’s at least outline the actual firms being paid a commission and stop hiding XYZ Accountancy or ABC Solicitors under ‘marketing or advertising’.  Many buyers, sadly, don’t read the forms that they sign, but some do.
End note
I also keep reading about the big lift in new housing approvals.  Lower interest rates are working blah, blah.  Yet many of these approved projects will not <a href="https://matusikmissive.com.au/2013/10/22/better-developments/" target="_blank">eventuate</a>.
There is heaps stacked up against new property – GST, taxes and charges, long and opaque council approval process and NIMBYism, to name just a few.
Whilst we now have an undersupply of new property, the mismatch between demand for new property and its supply isn’t anywhere as high as many economists believe.   So the usual drill of need exceeding supply won’t work this time around as well as it has in the past.
The two elephants in the room – misinformation and deflection - aren’t helping matters.  Outside of Sydney, it is going to be harder to make the new sales (that settle) that many anticipate over the next couple of years.
And it is in the country’s interest that more new homes are actually built.
Here are some facts to ponder:
<ul>
<li>
Residential construction (not approvals) adds two percentage points of GDP growth
</li>
<li>
Every $1 spent on residential construction has generated $1.31 worth of spending elsewhere in the economy
</li>
<li>
Every $1 million spent on residential construction generates 17 jobs on a full-time basis.
</li>
</ul>

<hr>
Michael Matusik is the founder of <a style="font-size: 14px;" href="https://www.matusik.com.au/" target="_blank" rel="nofollow">Matusik Property Insights</a>, which has helped over 550 new residential projects come to fruition.
Read <a href="https://www.matusikmissive.com.au/" target="_blank" rel="nofollow">Michael’s Blog</a> or follow him on <a href="https://www.facebook.com/ThinkMatusik?fref=ts" target="_blank" rel="nofollow">Facebook</a> and <a href="https://www.twitter.com/michaelmatusik" target="_blank" rel="nofollow">Twitter</a> or connect via <a href="https://www.linkedin.com/in/michaelmatusik" rel="nofollow">LinkedIn</a>.
 
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The hard yards: Second hand stock is booming but new sales is a different story

<a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> offers plenty of reasons to live vertically, but moving from a substantial family home into an apartment can expose the compromises of high-density living. Privacy, room for guests and usable living space tend to matter more when an apartment is intended as a permanent home rather than an occasional coastal base.

A typical residential floor at <a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a>, on Surf Parade,&nbsp;contains just four apartments. The 94-residence development by <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is predominantly made up of expansive three-bedroom homes, with a limited collection of half-floor penthouses above.

Across the apartment floors, <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> has used the relatively limited number of residences to give each home greater access to natural light and outlook. Living spaces extend towards full-height glazing, while a series of bay windows frame selected views across the Pacific Ocean, city and hinterland rather than treating the building edge as a continuous wall of glass.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360965]

“The apartment floors deliver a collection of homes that embrace controlled outlook via a series of bay windows deliberately framing moments of view,” Rothelowman Director Kim Lowman said.

From outside, those projecting forms contribute to the tower’s faceted profile. Strong horizontal and vertical elements establish its proportions, while the changing position of the sun alters the light, shadow and reflection across the façade throughout the day.

The same attention moves inside the apartments, where the material palette combines warm timber, natural stone, metallic detailing and softer curved forms. Kitchens sit within the main living zone, with stone island benches, integrated joinery and European appliances, before the living areas extend towards the glazing and the outlook.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360981]

Three genuine bedrooms provide room to accommodate family and guests, while two secure car spaces and storage address some of the practical considerations that can become more noticeable when moving from a larger home. Feedback from the display suite has centred on the warmth and restraint of the interiors, with buyers commenting that the residences feel like homes rather than conventional coastal apartments.

A limited collection of half-floor penthouses occupies the upper levels, increasing the scale of the living spaces and adding private balconies and elevated finishes. From this position, the outlook extends between the ocean and hinterland.

Outside the private residences, The Eveleigh separates its shared spaces between the podium and rooftop. The podium is centred on wellness, with subtropical landscaping surrounding a swimming pool and pool terrace, yoga garden, private gymnasium, sauna and hot and cold plunge facilities. Landscaped retreats and pavilions provide additional places to sit away from the main recreation areas.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360966]

Higher in the building, a rooftop pavilion and private dining suite sit alongside resident lounge, barbecue and outdoor dining areas, opening towards panoramic views across the ocean, city and hinterland.

“Buyers are no longer just looking for an apartment, but a lifestyle where they can relax, reset, and enjoy a balanced way of living,” Hirsch &amp; Faigen Director of Sales Matt George said.

Interest to date has come from established owner-occupiers and interstate lifestyle purchasers, including buyers planning a future move to the Gold Coast. Many are coming from larger homes and want to reduce ongoing maintenance without giving up space for family and guests, privacy, two car spaces or the ability to entertain at home.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360969]

Much of that daily life can also take place beyond the building without requiring a drive. Kurrawa Beach and Pratten Park are an easy walk from Surf Parade, while Pacific Fair, Oracle Boulevard, The Oasis, restaurants, cafés, entertainment and public transport are also within walking distance.

The Eveleigh is Hirsch &amp; Faigen's fourth Gold Coast development since entering the market in 2021, following The Hemingway at Palm Beach, The Emerson at Kirra and Yves at Mermaid Beach. Each of the preceding projects sold out before completion.

“Broadbeach had been on our radar throughout our time operating on the Gold Coast,” the developer said. “Following our projects in Palm Beach, Kirra and Mermaid Beach, Broadbeach represented the natural next step for the business.”

The Surf Parade site brought together proximity to the beach, protected coastal outlooks and walkability to dining, shopping and recreation. Hirsch &amp; Faigen also identified the street as an emerging premium residential address, with enough separation from Broadbeach's busier destinations to retain a quieter environment at home.

The Eveleigh is now under construction by Maxcon, with completion forecast for mid-2028. Three-bedroom residences are currently available from $2.87 million.

[smartcode_project_cta:default project_id=149670]

Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

A long-stalled Campbelltown development site is back in play, with new plans for 139 apartments set to supersede a mixed-use scheme approved almost a decade ago but never built.

The new proposal for 28 Cordeaux Street would deliver 116 market and 23 affordable apartments in a part 14-storey building, bringing a substantial new project into a Campbelltown market where new apartment supply remains limited.

Plans have been filed over the 3,092 sqm corner site at Moore-Oxley Street, around 600 metres from Campbelltown Railway Station and the city-centre retail core.

The site already carries a mixed-use residential approval dating to 2016. Doroch Architects has now been engaged on a larger replacement scheme, which is progressing as a State Significant Development Application following a Housing Delivery Authority determination in August 2025.

The apartment mix comprises 39 one-bedroom, 72 two-bedroom and 28 three-bedroom residences. Two-bedroom apartments make up just over half of the project, while three-bedroom homes account for 20 per cent.

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Of the 139 apartments, 23 will be delivered as affordable housing under the in-fill affordable housing provisions of the Housing SEPP. The affordable component represents 15 per cent of the residential gross floor area and will be managed by a registered Community Housing Provider.

Doroch has sought to break the scale of the building into two distinct elements, with a masonry podium of around four storeys establishing the street edge before the residential tower steps back above.

The corner position has shaped that approach. Cordeaux Street faces toward the commercial and civic centre, while Moore-Oxley Street leads into the lower-scale residential neighbourhood to the south, and the design verification report describes the site as "bridging the commercial core to the north and established residential areas to the south."

The podium will be expressed predominantly in face brick, while the upper levels shift to brushed and grooved concrete cladding with darker metal detailing. Recessed sections, deep balcony edges and landscaping break down the upper form, with an approximately 11.8-metre setback to the northern boundary addressing the adjoining St Peters Anglican School.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="c8b3d2d3-c561-4bfc-a5d9-a68c0c10dac1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da1.png?VersionId=AeAEyJU02Gk2k5noUj2StziCvdQ7fW4B" />

Campbelltown has been starved of new residential developments in the last decade.

The only other notable development set to come to market this year is ALAND's Queen Square, a mixed-use precinct on over two hectares that will comprise apartments above a vibrant ground-level retail and hospitality dining precinct.

First look: New 139-apartment plans revive long-stalled Campbelltown city centre site

First Look: Sherlock Construction pitches apartments for low-rise Deception Bay

Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.

The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.

Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.

The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.

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MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.

"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."

MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.

"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.

"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."

The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.

MAYD is targeting an early 2027 launch.

First look at MAYD's North Kirra mixed-use precinct

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Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.

[smartcode_project:default project_id=152737 project_image_fid=377679]

The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.

It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.

"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.

A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.

The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

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[smartcode_project_cta:default project_id=152737]

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Michael Matusik

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