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Gold Coast pre/post commonwealth games

Discussion in 'Where to Buy' started by LCK, 13th Nov, 2015.

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  1. LCK

    LCK Active Member

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    Hi everyone

    What are your opinions on property prices now compared to when the commonwealth games are over? Are we looking at a mini-boom right before and a drop in the market when they are over? Should I wait to buy or is the time now?

    I have no knowledge of the affect Olympic/commonwealth games have on property prices. All opinions welcome
     
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  2. Player

    Player Well-Known Member

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    Do you own any other investment properties?
    If so, how many? And, where?

    Why the interest in the Gold Coast? Will you be looking to flip after the Games?

    Residential is on a rise at present and is coming off a huge corrective base. Commercial especially retail and industrial is hot at present with stupidly low yields.

    Residential (read second hand houses with land..........not house and land packages) will continue to climb. Stay away from areas where there is no shortage of land...Coomera and Pimpama.
    Residential infill sites in old established suburbs will do well. The closer to the beach the better.

    Answer my questions above so those who have some idea of the market here can assist you. No one has a crystal ball. What you've done until now and your goals are important. Ignore the Commonwealth Games noise.

    I don't follow the apartment market here (used or new) so perhaps someone else can offer their opinion on those types of assets.
     
  3. seanbrissy

    seanbrissy Well-Known Member

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    Buying into the Gold Coast on the presumption the Commonwealth Games will create a "mini boom" would not be a wise investment, who's to say it will create any boom at all? I'd look more to other long term factors to base your decision around. I've travelled on the newly constructed light rail, which I think is absolutely fantastic, getting around the GC is so easy now, on the other hand it's created traffics problems. I know GC is a cheaper price point to enter but I've always viewed it as a risker option mainly due to supply. IMO Brisbane would yield better CG prospects, but if your heart is still set on the Gold Coast stay away from units unless it's older style or better yet try to buy a house.
     
  4. LCK

    LCK Active Member

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    Thanks for your replies.. Looking to move into it in the next year or so. So purely looking from the point of saving money on a PPOR. Not looking to flip

    I have a PPOR in St Marys worth approx $330k. Not sure if I want to sell yet
     
  5. Player

    Player Well-Known Member

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    What's your budget and where do you want to live? Will your work be on the coast or in Brisbane? All these factors will dictate where you will buy. The Commonwealth Games (whilst IMO will be a partial driver of value due to infrastructure creation) should be a secondary factor to your decision.

    If you're only going to be here for a few years, then might be best to rent.
     
  6. skyfall

    skyfall Well-Known Member

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  7. Azazel

    Azazel Well-Known Member

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    Hey @LCK
    Short answer is probably.

    I would say the sooner the better, but depends where it is as well.
     
  8. LCK

    LCK Active Member

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    Looking at townhouses in parkwood/arundel. Nice quiet family suburbs, 10 minute drive from southport, 45 minute drive to Brisbane cbd.. My budget is 320k max.. I don't have the serviceability for a house unfortunately
     
  9. Player

    Player Well-Known Member

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    They're good central areas and family oriented as you've mentioned. Brisbane CBD is a bit more than 45 minutes unless you're driving at 2.00 am. If you are keen on buying then the sooner the better. Gold Coast prices won't be falling any time soon aside from possibly new or OTP product in another circa 5 years when the apartment over supply rears its head again.

    Good luck with your search and move.
     
  10. Bender12

    Bender12 Active Member

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    I'm just about to settle on a place on the Gold Coast. I think the area is about to boom with all the infastructure and investment going into the area and the lower aussie dollar.
     
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  11. Mel_C

    Mel_C Well-Known Member

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    I would not sell a place in Sydney to buy a townhouse on the gold coast....houses are growing but townhouses here get very little growth.
     
  12. Azazel

    Azazel Well-Known Member

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    Yeah, the drive can be done in that time if you're lucky, but not when there's traffic.
     
  13. Richard Taylor

    Richard Taylor Mortgage Broker & Brisbane Buyers Agent

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    Certainly the Northern part of the GC around Southport, Labrador, Biggera Waters etc we are picking up some good bargains for clients and with the development pre Commonwealth games believe we will see a mini boom.

    While there is no way to truly measure the impact of every single mega sporting event collectively, research centred on the London Olympics published by City University London suggests real estate prices can be positively boosted.

    There are a number of models for statistical analysis on the subject, but the research flags the most popular and suggests that properties within three miles of the host stadium may experience a value increase of 5 per cent.

    Both commercial and residential property within a wider nine mile radius has the potential to jump in value by up to 2 per cent. While the figures take into account a real estate market on the other side of the world, there is little reason why Gold Coast shouldn't feel similar effects providing the 2018 Commonwealth Games are a success.

    Cheers


    Richard
     
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  14. Bryan Loughnan

    Bryan Loughnan Well-Known Member

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    Gold Coast is going very very nicely at the moment. Probably has the potential to be the best performing location in the country (yup - in the country) over the next 2-3 years. Economy is picking up - Lord Mayor has done a lot over the last 5 years to get things moving and not being fully reliant on the Tourism industry. Retail (several big developments/renovations - Pac Fair, Australia Fair, Robina, Casino just to name a few), infrastructure (light rail project - recently been granted further extension, Comm Games construction in general), health (hospital upgrade) and education (uni expansion/upgrade over the last 5 years). All in all - the economy on the Gold Coast is really bubbling along nicely. Certainly is showing signs of recovery after the GFC.

    Unfortunately, looking further head (post the initial good 2-3 year period) the outlook certainly isn't as rosy. As well as all of the above, the Gold Coast Lord Mayor has significantly pushed the construction industry. Building and Development approvals are up significantly (approx 5,000 in 2014 up from 2,500 in 2012). Whilst this is great for job creation and general economy now, it is a HUGE amount of supply which will hit the market over the next few years. Whilst most of it is in the apartment market - it is still general supply of accommodation/shelter which will impact the market significantly. Furthermore, the athletes village from the Comm Games is to be split up post the Games and spread across the Gold Coast as affordable housing. Whilst this may not be your target demographic as a property investor, it is still increased supply into what will be an already oversupplied market. The Gold Coast has a history of oversupply and there is a real chance they will be in an all too familiar situation in the next 3-5 years.

    Just a few things to think about.
     
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  15. big max

    big max Well-Known Member

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    Hi - I've just joined, so looking forward to discussing stuff here. I'm pretty bullish on the Gold Coast next 5 years. Not just because of the Commonwealth Games, but rather because of all that's going on at present. Olympics are not yet confirmed, but word is Brisbane and Gold Coast will be puting in a strong bid for 2024 or 2028 and I think they have a very strong chance of succeeding (for a range of reasons, including security, good planning and infrastructure, strong sporting history and experience, good climate (both temperature and air quality), food safety, etc).

    For the Gold Coast, I would be looking to buy now, ASAP, as things will get a little crazy after Xmas etc as all the Sydney and Melb crowd start buying in the summer, and as marketing to Asia really starts to ramp up.

    As for boom/bust, yes, GC does have a history of such cycles, which is actually great if you know what you are doing. I would pick the coming boom to last to 2020, and a bust if any, will likely either come due to apartment oversupply, or if/when houses beachfront at Mermaid and Hedges Ave etc hit stratospheric levels again. But right now we are at the very early murmurings of a coming boom. I would also add that despite boom/bust cycles, I think long term the Gold Coast will really outperform so if you are long term you can ride out cycles. The growth we having coming, in terms of population, along with other demographic trends, infrastructure development, economic diversification and economic growth, point to property on the Gold Coast to be a great long term investment.

    Ideally one would be buying freehold land/house, and ideally the closer to the beach the better. For foreign investors, I would be looking for apartments with some kind of unique factor, such as excellent location, a view that cannot be built out, near a facility that is likely to be in demand for employees (whether casino, hospitals, Universities, etc), with a view to selling in 5 years if supply starts looking excessive.
     
    Last edited: 30th Nov, 2015
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  16. Azazel

    Azazel Well-Known Member

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    I would be looking to dump it if it had a large increase shortly after the Commonwealth Games.
     
  17. big max

    big max Well-Known Member

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    Sure - whenever any asset has a rapid increase you need to revalue and assess if its time to sell. The challenge for an investor is to assess whether, despite the rapid gain, the asset is still fair value, or not. For example, if prices are up 50% by the time of the games, but during that time the population has risen significantly, business incomes have risen significantly, foreign investment has risen significantly, etc, new casino has opened, light rail has been extended, etc etc - you would need to weigh up all those factors, and you might conclude that whilst prices are up x%, that "real value" is actually x+y%, hence you should be holding (or even buying!).

    Always weigh up all relevant factors, and don't simply rely on nominal gains (or losses) in value to make buy/sell decisions. Remember there are also transaction costs associated with buying and selling - stamp duty, bank fees, legal fees, agents fees etc. So sometimes, if you are entering a correction in what might well be a long term bull market, you might just want to ride it out. So, if you felt, for example, that from now through to 2030 there was a long term growth market for the Coast, you might just be best off staying in through out. For beachside Hedges, I think getting in/out probably is the way to go, but for property less volatile, such as Mermaid Waters, you might well be best off with a hold and wait strategy.

    Having said all that, one thing I really like as an investor is volatility. Volatility does present the best opportunity to "buy low sell high", which is why the Gold Coast is so interesting to me as an investment market :)
     
    Last edited: 1st Dec, 2015
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  18. Mel_C

    Mel_C Well-Known Member

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    Im in Mermaid Waters and bought with the hope of the growth you are talking about @big max . We bought first home buyer type property for 550K earlier this year and we absolutely love living here after living over the other side of the M1 for many years and for the rest of my life in Sydney. The lifestyle here is amazing and I think once Sydneysiders realise this we will see some good growth. I like Mermaid waters over Mermaid Beach as you get bigger blocks of land and are away from some of the beach riff raff but you have shopping, beach, transport, cafes all so close by. I agree that if you bought at the bottom of the market on GC you should already be seeing some good growth. I have noticed Miami has been having a great run at moment.
     
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  19. Azazel

    Azazel Well-Known Member

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    It's a lovely spot.
    I do miss living near the beach.
     
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  20. Mel_C

    Mel_C Well-Known Member

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    Its not just the beach its how easy it is to go to the beach. Beaches in Sydney on the weekend you cant park its a pain in the butt so you don't go to beach. Here you drive to hedges ave park right in front of the flags and jump in for a swim.