SUNSHINE COAST REGIONAL CENTRE OVERVIEW

Transcription

1 2018 EDITION 1 SUNSHINE COAST SUNSHINE COAST REGIONAL CENTRE

2 SUNSHINE COAST The Sunshine Coast is currently the 9th most populated area in the nation, with the latest ABS figures showing a population base of 303,389. This region holds approximately 6% of the Queensland population and on average has grown by approximately 6656 people per annum since The Sunshine Coast property market has experienced historic compounding growth rates of 8.13% for houses and 6.41% for units since Over the past 10 years the market has run at a growth rate of 2.41% PA for houses and 1.78% PA for units. In 2016, the dominant sector was Construction which contributed 15% to GRP. This was followed by Health Care & Social Assistance at 14%. Ideally, to minimize risk, we would like no one industry at more than 10% contribution. Over 2017 there is approximately $2900 per person committed to public infrastructure spending for projects over $10 million in the Sunshine Coast Region. $2900 per person of spending in the pipeline is considered average based on the national average of $3000 per person. MAJOR PROJECTS APPROVED Sunshine Coast University Hospital / Caloundra Health Service Refurbishment / Caloundra South New Primary School / Sunshine Coast Airport Expansion / Maroochydore City Centre Priority Development SUNSHINE COAST AS WE SEE IT We believe this market is showing Limited Value. Given the rate of long term growth, economic diversification and the population base we believe it is best suited to a Short to Medium Term Trading Strategy. We classify the Sunshine Coast as a Medium to High Risk investment based on the size of the population, population growth, stage of the cycle and economic factors. 2

3 AT A GLANCE Type of Tenure Other, 1.8% Not Stated, 2.5% Rented, 29.6% Owned Outright, 33.1% SUNSHINE COAST 2018 Owned with Mortgage, 33.1% Median rent for houses on the Sunshine Coast is $440 and $355 for units. Rents have increased approximately 4% per annum since THE SUNSHINE COAST HOUSE MARKET PREVIOUSLY PEAKED IN 2008 AND HOUSE PRICES ARE CURRENTLY 20% HIGHER THAN THIS LAST PEAK. THE UNIT MARKET LAST PEAKED IN 2010 AND THE CURRENT UNIT MEDIAN PRICE IS 8% HIGHER THAN 2010 PRICES. Both houses and units have experienced less than the historical growth rate over the last 10, 7, 5 and 3 years % YIELDS ON THE SUNSHINE COAST HAVE BEEN STAGNANT SINCE 2011 AND ARE CURRENTLY SITTING AT 4% FOR HOUSES AND 4.7% FOR UNITS. After experiencing a high of 4.1% in 2011, vacancy rates are currently at 1.4%. In 2017, dwelling approvals are 124% higher than in THE CURRENT UNEMPLOYMENT RATE IS 5.9% down from a high of 6.8% in The Sunshine Coast s unemployment rate is above the current national rate of 5.5%. THE SUNSHINE COAST S POPULATION HAS INCREASED ON AVERAGE 2.5% PER ANNUM OVER THE LAST 10 YEARS. FORECASTS SUGGEST THAT THE POPULATION WILL RISE TO 452,987 PEOPLE BY K 250K 375K 500K 3

4 CONTENTS Key Indicator 1 THE ECONOMY Key Indicator 4 SUPPLY FACTORS Gross Regional Product Slightly Negative Vacancy Rate V. Median Rent Positive Council Budget Slightly Positive Dwelling Approvals Slightly Negative Industry Diversity Slightly Negative Bedroom Commencements V. Population Slightly Negative Stock on Market Slightly Positive Key Indicator 2 AFFORDABILITY Days on Market Neutral Gross Affordability Index (House) V. Price Growth Gross Affordability Index (Unit) V. Price Growth Slightly Positive Positive Key Indicator 5 INVESTMENT VALUE Median Price V. Income Slightly Negative Long Term Performance Slightly Positive Median Price V. Rent Neutral Yield Neutral House V. Unit Price Movements Positive Key Indicator 3 DEMAND FACTORS Population Population Pyramid Unemployment Rate Job Creation Infrastructure Spending Airport Arrivals Slightly Positive Negative Neutral Slightly Positive Slightly Positive Neutral Sunshine Coast V. Brisbane Price Price Comparison Slightly Positive Neutral 4

5 OUR VIEW OF THE SUNSHINE COAST HOUSE MARKET We believe that currently this market is showing Limited Value. AVOID LIMITED VALUE The market is showing some value opportunities. Overall, most fundamental indicators support growth. LIMITED VALUE SUNSHINE COAST SUBURB RANGE - HOUSES AVOID CAUTION The market is showing no value and price falls in the short term are possible. There are no fundamentals that support price growth in the short term. CAUTION The market is close to being overvalued and/or oversupplied. We see minimal growth over the short- to medium-term. VALUE VALUE The market is showing good value on most properties. Many fundamental indicators exist which support strong growth. For more information on the Sunshine Coast market, including individual property and suburb selections, call to speak to one of our professional property advisors on

6 OUR VIEW OF THE SUNSHINE COAST UNIT MARKET We believe that currently this market is showing Limited Value. AVOID LIMITED VALUE The market is showing some value opportunities. Overall, most fundamental indicators support growth. LIMITED VALUE SUNSHINE COAST SUBURB RANGE - UNITS AVOID CAUTION The market is showing no value and price falls in the short term are possible. There are no fundamentals that support price growth in the short term. CAUTION The market is close to being overvalued and/or oversupplied. We see minimal growth over the short- to medium-term. VALUE VALUE The market is showing good value on most properties. Many fundamental indicators exist which support strong growth. For more information on the Sunshine Coast market, including individual property and suburb selections, call to speak to one of our professional property advisors on

7 GROSS REGIONAL PRODUCT V. MEDIAN PRICE $600,000 $545,000 $570,000 16,000 $500,000 $519,500 $495,000 $475,000 $480,000 $468,000 $462,500 $452,250 $449,000 $447,250 14,000 12,000 $400,000 $400,000 $385,000 $392,500 $330,000 10,000 SLIGHTLY NEGATIVE $300,000 8, ,000 $200,000 $179,500 6,000 4,000 $100,000 2,000 $ GRP ($Mil) Median House Price 7

8 SUNSHINE COAST CITY COUNCIL BUDGET POSITION $30,000,000 $25,000,000 $24,313,000 $22,828,000 $20,000,000 $19,040,000 SLIGHTLY POSITIVE $15,000,000 $15,025,000 $12,713,000 $10,000,000 $7,680,000 $5,000,000 $

9 INDUSTRY DIVERSITY Other Services, 3.00% Arts and Recreation Services, 1.00% Agriculture, Forestry and Fishing, 2.00% Mining, 1.00% Manufacturing, 6.00% Health Care and Social Assistance, 14.00% Electricity, Gas, Water and Waste Services, 3.00% Education and Training, 7.00% Construction, 15.00% SLIGHTLY NEGATIVE Public Administration and Safety, 4.00% Administrative and Support Services, 3.00% Wholesale Trade, 4.00% Professional, Scientific and Technical Services, 5.00% Rental, Hiring and Real Estate Services, 5.00% Retail Trade, 8.00% Accommodation and Food Services, 5.00% Financial and Insurance Services, 8.00% Transport, Postal and Warehousing, 4.00% Information Media and Telecommunications, 2.00% 9

10 GROSS AFFORDABILITY INDEX (HOUSE) V. PRICE GROWTH 70% 60% 54% 62% 50% 48% 48% 49% 40% 30% 44% 37% 32% 29% 36% 39% 31% 23% 24% 24% 28% 23% 31% 30% 41% 40% 33% 42% 37% 33% 28% 29% 27% 30% 31% SLIGHTLY POSITIVE 20% 17% 13% 12% 10% 8% 7% 7% 6% 3% 3% 3% 6% 9% 6% 3% 3% 7% 5% 5% 5% 0% 3% 2% 2% -1% -1% -1% -10% -6% Median House Price Affordability Index (State Income) (Avg 36%) 10

11 GROSS AFFORDABILITY INDEX (UNIT) V. PRICE GROWTH 50% 47% 47% 40% 41% 39% 40% 42% 42% 34% 33% 35% 33% 32% 30% 20% 29% 26% 29% 23% 23% 23% 27% 20% 23% 19% 26% 28% 25% 20% 21% 20% 22% 22% POSITIVE 16% 10% 0% 5% 6% 4% 10% 6% 2% 3% 8% 4% 0% 3% 0% 4% 5% 2% 3% 1% 1% 0% 1% 5% 4% 3% 3% -10% -7% Median Unit Price Affordability Index (State Income) (Avg 29%) 11

12 MEDIAN PRICE V. INCOME $600,000 $500,000 $1,496 $1,452 $1,471 $1,416 $1,426 $1,356 $1,372 1,275 $1,200 $1,107 $1,600 $1,400 $1,200 $400,000 $300,000 $200,000 $401 $437 $461$484 $503 $558 $575$584 $611 $600 $617$659 $566 $662 $670 $786 $759 $ $848 $866 $921 $ $1,025 1,010 $1,000 $800 $600 $400 SLIGHTLY NEGATIVE $100,000 $200 $- $ Median House Price Income QLD HH Income Sunshine Coast 12

13 MEDIAN PRICE V. RENT $600,000 $500 $426 $440 $450 $500,000 $400,000 $280 $303 $343 $274 $350 $290 $356 $293 $362 $296 $364 $298 $378 $306 $393 $320 $411 $333 $344 $355 $400 $350 $300 NEUTRAL $300,000 $245 $250 $224 $200 $200,000 $150 $100 $100,000 $50 $ $- Median House Price Median Unit Price Median Rent House Median Rent Unit 13

14 POPULATION 4.0% 3.5% 3.08% 3.0% 2.82% 2.81% 2.89% 2.89% 2.63% 2.5% 2.46% 2.37% 2.50% SLIGHTLY POSITIVE 2.0% 1.94% 1.5% 1.59% 1.0% 0% Queensland Sunshine Coast 14

15 POPULATION PYRAMID Age in years Males 85 + Females NEGATIVE % of males % of females Source: Australian Bureau of Statistics, Census of Population and Housing, 2016 (Usual residence data) Compiled and presented in profile.id by.id, the population experts. Sunshine Coast Greater Brisbane 15

16 UNEMPLOYMENT RATE 14.0% 12.0% 11.8% 11.0% 10.9% 10.0% 8.8% 8.0% 7.4% NEUTRAL 6.0% 5.1% 6.4% 5.1% 5.3% 6.5% 5.9% 6.2% 6.3% 6.7% 6.8% 5.9% 5.7% 4.2% 5.0% 4.0% 2.0% 0.0% Sunshine Coast Queensland 16

17 JOB CREATION INDEX SLIGHTLY POSITIVE Sep 2011 Nov 2011 Jan 2012 Mar 2012 May 2012 Jul 2012 Sep 2012 Nov 2012 Jan 2013 Mar 2013 May 2013 Jul 2013 Sep 2013 Nov 2013 Jan 2014 Mar 2014 May 2014 Jul 2014 Sep 2014 Nov 2014 Jan 2015 Mar 2015 May 2015 Jul 2015 Sep 2015 Nov 2015 Jan 2016 Mar 2016 May 2016 Jul 2016 Sep 2016 Nov 2016 Jan 2017 Mar 2017 May 2017 Jul 2017 Sep

18 PUBLIC INFRASTRUCTURE SPENDING $1,000,000,000 $3,250 $900,000,000 $2,706 $2,909 $2,750 $800,000,000 $700,000,000 $600,000,000 $1,672 $2,072 $2,143 $2,250 $1,750 SLIGHTLY POSITIVE $500,000,000 $1,492 $1,473 $400,000,000 $1,135 $820,825,000 $882,701,667 $1,250 $300,000,000 $628,565,667 $650,036,667 $750 $495,000,000 $200,000,000 $421,000,000 $426,000,000 $100,000,000 $312,000,000 $250 $- -$ Spending Per Person 18

19 AIRPORT ARRIVALS $600, ,000 $570,000 $545,000 $519,000 $495,000 $500, ,000 $475,000 $480,000 $462,500 $449,000 $447,250 $400,000 $400,000 $385, ,000 $330,000 NEUTRAL $300, ,000 $235,000 $200, ,000 $179,000 $156,000 $152,000 $147,000 $131,500 $144,000 $122,500 $165,000 $115,000 $106,000 $140,000 $143,000 $94,000 $100,000 $74, ,000 $58,000 $55,000 $ Domestic Arrivals International Arrivals Median House Price 19

20 VACANCY RATE V. MEDIAN RENT $ % $ % 4.1% $411 $426 $ % $400 $350 $ % $342 $274 $350 $ % $356 $293 $362 $296 $ % $298 $378 $306 $393 $320 $333 $344 $ % 3.0% 2.5% POSITIVE $ % $ % $ % 1.5% 1.4% 1.4% 1.5% $ % $50 0.5% $- 0% House Rent (3 Bed) Unit Rent (2 Bed) Vacancy Rate 20

21 DWELLING APPROVALS V. VACANCY RATE 4.5% 5, % 4,372 4, % 4.1% 4,547 4, % 3,896 4, % 3.0% 2.5% 2,881 2,625 3, % 3,238 2,365 2, % 2,807 3,104 3,500 3,000 2,500 SLIGHTLY NEGATIVE 2.0% 2, % 2, % 1,578 1, % 1.4% 1.4% 1, % 1.2% 1, % 500 0% House Other Total Vacancy Rate 21

22 BEDROOM COMMENCEMENTS V. POPULATION CHANGE 10,000 9,000 9,138 8,000 7,000 6,000 8,744 6,486 6,655 6,056 7,491 6,476 7,247 7,725 7,237 6,930 5,614 6,850 6,208 7,792 7,406 9,094 SLIGHTLY NEGATIVE 5,000 5,762 5,250 4,730 5,006 4,986 4,188 4,000 4,056 3,000 3,156 3,386 2,000 1, Approvals Based on 2.5 Persons per HH Population Change 22

23 STOCK ON MARKET 16,000 14,000 13,414 13,000 12,546 12,456 12,000 12,000 12,000 11,500 11,000 10,000 10,500 SLIGHTLY POSITIVE 8,600 8,000 6,000 4,000 2,

24 DAYS ON MARKET NEUTRAL Jan 2017 Feb 2017 Mar 2017 Apr 2017 May 2017 Jun 2017 Jul 2017 Aug 2017 Houses Units 24

25 LONG TERM PERFORMANCE 9% 8.13% 8% 7% 6.41% 6% 5% 4.97% 4.81% SLIGHTLY POSITIVE 4% 3.53% 3% 3.04% 3.14% 2.41% 2% 1.78% 1.13% 1% 0% LT (39Yr) 10Yr 7Yr 5Yr 3Yr Houses Units 25

26 YIELD 5.0% $600, % 4.6% 4.6% 4.6% 4.6% 4.6% 4.7% 5.0% 4.0% 3.7% 3.7% 4.0% 3.9% 4.2% 3.9% 4.2% 4.2% 4.2% 4.2% 4.1% 4.1% 4.1% 4.0% $500, % 3.5% $400, % NEUTRAL 3.0% $300, % 2.0% $200, % $100, % 0% $ Yield House (3Bed) Yield Unit (2Bed) Median House Price Median Unit Price 26

27 HOUSE V. UNIT PRICE MOVEMENTS $600, % 155% 160% $500, % 130% 129% 132% 140% 129% 122% 140% $400,000 $300, % 115% 105% 101% 94% 91% 89% 91% 91% 90% 94% 98% 99% 96% 94% 86% 77% 80% 82%83% 86% 78% 75% 77% 76% 75% 76% 74% 73% 72% 69% 71% 120% 100% 80% POSITIVE $200,000 60% $100,000 40% 20% $ % Median House Price LGA Median Unit Price LGA % Difference Between House & Unit Price (Avg 96%) 27

28 SUNSHINE COAST V. BRISBANE PRICE COMPARISON 160% $600, % 140% 127% 125% 125%123%123% $500, % 100% 92% 93% 106% 102% 96% 111% 112% 110% 108% 109% 104% 103% 110% 102% 108% 106% 113% 112% 104% 104% 104% 104% 105% 101% 104%105% $400,000 SLIGHTLY POSITIVE 87% 80% $300,000 60% $200,000 40% $100,000 20% 0% $ Brisbane Median Sunshine Coast Median % Difference (Avg 108%) 28

29 PRICE COMPARISON 80% 73% 67% 60% 51% 54% 40% 35% 37% 28% 24% NEUTRAL 20% 9% 7% 0% -20% -19% -13% -40% Townsville Brisbane Cairns Gold Coast Toowoomba Mackay Current Average 29

30 WHY USE US? OUR PROCESS RESEARCH Macro Micro Property INVESTMENT PHILOSOPHY PERFORMANCE PROPERTY ADVISORY IS A DYNAMIC PROPERTY FIRM PROVIDING PROPERTY ACQUISITION SERVICES ACROSS AUSTRALIA. OUR FIRM IS COMPLETELY RESEARCH DRIVEN AND WE APPLY A SOUND COUNTERCYCLICAL INVESTMENT APPROACH. All property must pass our stringent investment criteria and is subject to a thorough due diligence process. Our low risk approach excludes 99% of all properties currently on the market. We never source properties direct from developers and we don t buy properties off the plan or in new housing developments. We have a strict no commission policy preventing us from ever taking commissions from agents or referrers. We believe in providing quality ethical advice and exceptional customer service. We pride ourselves on delivering successful outcomes every time, guaranteed. Our objective is not to buy you a property. Purchasing a property is the last step in our considered and thorough process. Our mission is to understand and satisfy your needs financial or emotional, in a low risk and efficient manner. Our objective is to build you wealth through sophisticated property investment. We believe in everything we do because we treat your investment portfolio like it was our own. PERFORMANCE PROPERTY ADVISORY SERVICES Property Acquisition Property Management Portfolio Review Sales Advisory / Vendor Advocacy ACQUIRE Find Assess Negotiate MANAGE Property Management REVIEW Annual Portfolio Review ADVISE Hold Improve Dispose DATA SOURCES: Australian Bureau of Statistics BIS Shrapnel Residex SQM Research CoreLogic RP Data Foreign Investment Review Board Australian Trade & Investment Commission 30

31 IMPORTANT INFORMATION INTELLECTUAL PROPERTY RIGHTS This Report contains information that has been supplied by third parties. While such information is published with the necessary permission, to the extent permitted by law we do not accept any responsibility or provide any warranty in relation to the accuracy, eliability, completeness or suitability of the information contained in this Report. You acknowledge that the information, figures and projections have been provided by various sources and have not been verified by us and as such and may not be relied on in any way. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. You should therefore conduct your own enquiries about these matters. This information is therefore provided as general information only, current as at the time of publication and does not constitute financial advice, whether in relation to valuation or otherwise, and may not be relied on in any way. To the full extent allowed by law we exclude, and you release us from, liability in contract, tort or otherwise, for any loss, costs or damage sustained by you, or by any other person, howsoever caused, arising from or in connection with the supply or use of the whole or any part of the information in this report. This Report is comprised of matter (including copyright works and other subject matter) in which various intellectual property rights exist, including without limitation copyright, patents, designs, trade marks, goodwill, rights in computer programs and databases and any other similar rights of a proprietary nature ( Intellectual Property ). All Intellectual Property in this Report or any Content (including if it is licensed to us) is the exclusive property of McMillan Sier Pty Ltd or our licensors (as the case may be). Subject to our right to terminate permission for you to use any Intellectual Property in the Report or any Content, you may use the Intellectual Property only to the extent necessary to enable you to browse this Report (in the form it is available to the public) for your own personal use and to provide registrations of interest and Feedback. We reserve all other rights with respect to the Intellectual Property. For the avoidance of doubt, you may not use this Report or any Content for any commercial purpose and you may not reproduce, publish, communicate, transmit or incorporate into any other document or thing the whole or any part of this Report or the Content without the prior written permission of the Intellectual Property owner. We reserve the right to revoke at any time, with or without cause, your permission to use any copyright, trade mark or any other Intellectual Property in this Report or any Content. Access to this Report does not, unless and only to the extent expressly stated otherwise, confer on you any license or other rights in respect of the Intellectual Property in this Report or any Content.

32 HEAD OFFICE Level 10, 30 Collins St Melbourne VIC 3000 Phone: Visit Our Site Adelaide Suite 91, 30 King William Street, Adelaide, South Australia 5000 Licence #: (08) Brisbane Level 10, 239 George Street, Brisbane, Queensiand 4000 Licence #: (07) Sydney Level 18, 50 Bridge Street, Sydney, New South Wales 2000 Licence #: (02) Melbourne Level 10, 30 Collins Street, Melbourne, Victoria 3000 Licence #: L (03)