QLD Mackay Market

For those interested in the Mackay Region.

Rental market at its "tightest"

 

What’s people’s thoughts on this CQ town? Last year it was recorded as one of the most search Australian towns on realestate.com

 

I live here. Rentals are tight. Not much investor interest but lego land estates are starting to ramp up. I'd also watch spot price of coal however coking coal is holding up better than thermal. The town is now getting quite expensive for what it is. Best time to buy was 2017/2018.

 

Speaking to a colleague who listed their small renovated Queenslander over a weekend.

69 applications.. Most quality..

 

Vacancy rates super low at the moment. Some people in town making good $$ flipping old stock on the inner east.

 

@wilso8948 - Is there any chance you could give an update on the Mackay market as it currently stands please?
I've been keeping an eye on the Mackay market on Realestate.com.au for the past couple of weeks, and it looks as if there is movement in the sales side of things. It seems as if rental supply is still low (1% vacancy rate). This must mean that rents are moving upwards too?

@pinkboy are you still in Mackay? What are your thoughts? Thanks!!

 

The rental market is tight across many locations in Australia. However low vacancy rate does not always lead to a boom.

In the CQ region, Rockhampton beats Mackay in economic diversity and therefore is always a safer option.

At the moment, the median days on market is still high for both locations (compare either Mackay or Rocky with say Cairns and you will see the difference). The boom won’t officially start in Central Queensland until there is a massive drop on median days on market.

That being said, Mackay’s building approval has been kept below 20% of its peak in 2012 for the past 5 years, which means stocks are being slowly absorbed. Considering that Mackay’s boom has been long overdue, it won’t surprise me if a boom takes place in the next 5 years.

 

Thanks for the update @alanyin
I don't imagine that there will be a boom (or anything like the madness going on in the SE of the state) in CQ at any point in the future - I just can't see the drivers for it.
Your comment about Rocky being more economically diverse than Mackay has stumped me though; I'd see both cities being one and the same - both have mineral resources and agriculture at their doorsteps; if anything Mackay would have the upper hand with tourism potential and access to the Whitsunday Islands etc. Mackay's population is 45% larger than Rockhampton too. (R 78,600 VS M 125,000).
Out of the 3 cities you mentioned, Cairns would be the least diverse, but it's been stagnant for so, so long, it's good to finally see some movement.

 

Mackay and Rocky are both about the same size actually (Mackay being ever slightly larger), both around 80,000. The larger 120,000 figure is the Mackay Regional Council population which includes towns like Sarina, Marian and Walkerston.

 

Thanks! I just googled both cities and received those figures in my search responses.

I guess these little towns will be classed as outlying suburbs (much like Yeppoon to Rockhampton) as the population grows - over the next decade or 3.

 

In some respects, they kind of already are like satellite towns (Yeppoon and Mount Morgan to Rocky) which feed into those cities. I am sure there's no shortage of residents who live in those towns within 50km of each major centre who commute to work each day.

 

@Icarus Certainly been some significant uplift in the past 12 months although the market was starting to move early 2019 IMO. Vacancy rates were tightening then. You could see land developers starting to move with fresh marketing campaigns and rentals were extremely tight.

I'm sure most can access the data so I won't dwell too much but anecdotally supply is very tight. Local agents are struggling for listings although I suspect some looking to get out after being burnt in previous booms are looking to list. Everything is selling within a week or so of listing. I suspect there is a rising tide lifting all ships though. Some 450m2 spec homes are selling for early to mid $4s which is pretty crazy for this market. Newer in-demand estates with newish houses on 600m2+ are well over half a mil and pushing early to mid $6s. Covid brought demand for acreage properties which made me pivot away from our pre-covid plans for a PPOR. Instead we purchased a block from the beach.

The thing is there is significant wealth floating around the area. Large business owners who loathe the city, significantly high wages for relatively blue collar positions in the mines, very reasonable base salaries for entry level positions. As an example a trainee planner roll is a six figure salary at my work. Most places have various long term positions available for those willing to make the move to a regional location. The town is still tied to mining but is starting to grow up. Infrastructure is looking solid. Significant road upgrades are happening with construction sites crawling with workers.

There is also various migrant communities floating around. Young families with a professional background putting down their roots. These seem to stick to specific estates and schools are a very big driver of demand.

I feel the demand will be sustained and increase in the near future with construction lagging. Houses just aren't getting built quick enough. I can see investors starting to enter the market especially with Brisbane moving. Plenty of Brisbane homeowners are familiar with Nth Qld and will begin to realise some growth from their properties and look for returns in areas they know.

Rents have increased significantly over the past 2 years. We were renting after relocating and ours moved 20% in that time. It could have been worse if we were a new tenant. Local agencies just don't have enough properties to rent. Investors are still "scared" and I feel there's some solid gains to be made for the first movers. Sometimes I scratch my head when I read about all the investors entering regional NSW and Vic markets with populations circa 50k but won't look at Nth Qld. I've been to all these locations and fail to see how Mackay is "riskier" at the current price points.

 

Whilst we are on the topic of Sarina, Marian and Walkerston - I'd avoid these locations for investments. These small towns are where local long-term Mackay locals move as they can't afford Mackay itself once outside money moves in.

 

One of my mates has 2 properties near the airport in Mackay ,one rented the other he lives in and rents the rooms out..He was saying this morning several years ago when it was in the final boom stage ,that it is starting to boom again at least back to the price level he was offered a few years back..
Adani – now Bravus – strikes coal at controversial Carmichael mine

 

@wilso8948 Thank you so much for such a concise update; very interesting! I may have underestimated the region in terms of potential growth; I didn't think (post mining boom) that Mackay would see another significant upswing - but it seems a lot of the factors are there to improve the outlook of the area in the foreseeable future. I think you're correct in your analogy though; rising tides lift all ships - there's a flow on effect from significant increases further south that will bring the market up. When prices are such that you're buying a decent house for almost the value of the land itself, and the rental market is screaming out for vacancies - then it's got to be a better option than smaller regional southern locations.
Thanks once again for the info, also to @willair for the firsthand anecdote.

 

Hard to see Mackay booming anytime soon with such a glut of stock n the market:

SQM Research - Property - Total Property Listings - 4740

SQM Research - Property - Weekly Asking Property Prices - 4740

 

Stock in decline and asking prices increasing.

Am I missing something?

 

What about Slade point? I’ve noticed there’s quite a big difference in house prices, you can get a house fairly close to the water for under $300K

 

Slade Point is very good location wise however very poor demographics. Will take years to shake the stigma but long term has potential. Close to the water is ok but I wouldn't venture any further back. It gets pretty rough.

 

Just looked up it’s demographics data and it doesn’t seem to be a low socioeconomic area at all… 6% of public housing, 34% renters, average income is $937 pw all suggesting it’s not too bad… at least very on par with the rest of Mackay. Am I missing anything here (I'm assuming you're local to Mackay)?

I have to say I’m surprised that the demographics in Mackay is not looking bad at all (now that I look at it). It’s hard to find suburbs like Manunda, Mooroobool or Manoora for Cairns, Vincent, Heatley or Garbutt for Townsville, Rockhampton City or Berserker for Rockhampton, sububrs near Gladstone Central for Gladstone etc.

I always had the impression that Mackay is not economically diversified enough and hence the previous 35% drop in price from its peak. But interestingly it has such good demographics for cities north of SEQ...