01 August 2024
Into the Stratosphere - The Gold Coast towers as records tumble
Mansion Magazine - The Australian
Once billed as a sunny place for shady people, the Gold Coast is experiencing a renaissance of apartment sales buoyed by population growth, limited stock, and a surge in southerners who are wanting to relocate north.
Fresh from the success of their initial Gold Coast development, billionaire coal baron Brian Flannery and his wife, Peggy, of KTQ Developments, are about to launch stage two of their Kirra Beach development on the southern Gold Coast, with a $200m, 85-apartment 13-level tower and a 92-room six-level hotel complex overlooking the beach.
The Flannerys are banking on the sellout success of the stage one development at Kirra, where they sold 118 apartments and retained two penthouses for themselves.
They are also no doubt banking on the fact that the Gold Coast’s median dwelling value rose 11 percent in the last quarter to more than $907,000—a yearly increase of 7.3 percent and a 63.5 percent jump on five years ago, according to CoreLogic.
In fact, of the top 10 Queensland suburban suburbs to record the highest 12-month value growth, five are located on the Gold Coast.
Flannery told Mansion that construction would take 2½ years. He stressed the Kirra Point project would overlook the beach and that a complaint about the project was recently dismissed by an environment court; however, an appeal has been lodged. The design would be finalized once the appeal had been dealt with. Prices would be set once construction starts.
Also in Flannery’s favour is the fact that residential building approvals on the Gold Coast are well down on previous years, according to Australian Bureau of Statistics data provided to Mansion by Gold Coast City Council.
For the year ending June 30, the total number of house, apartment, and townhouse approvals on the Gold Coast was 4,038 compared with 5,932 for the previous corresponding year and 5,590 the year before that.
Over at Meriton headquarters, national sales director James Sialepis said a mix of people from the southern states and Brisbane were purchasing in the Iconica tower, Meriton’s latest project, with the average price for a two-bedroom apartment around $1.9m.
“The selling market on the Gold Coast is experiencing a positive and steady trend, with prices consistently increasing,” Sialepis said.
“This success is largely due to the diverse market the Gold Coast is now attracting.
“In the past month, we’ve seen a balanced mix of interstate buyers from all over Australia, along with a notable improving presence of overseas buyers from Hong Kong, Singapore, and China. The split between investors and owner-occupiers was even, with some returning expats also making purchases.
“Our two Gold Coast sites, Iconica and Cypress Palms, are Meriton’s leading performers in inquiries. Both sites are currently under construction and are set for completion in 2026 and 2027,” Sialepis said. While the average price for a two-bedroom apartment in Iconica was $1.9m, the average for a two-bedroom unit in Cypress Palms—Queensland’s tallest tower at 302m—was $1.325m.
Sydney-based Meriton has fared well on the Gold Coast because it has its own construction team. However, other developers in southeast Queensland who are reliant on independent contractors have floundered.
One Queensland builder located north of the Gold Coast said the region was suffering from a shortage of subcontractors and tradespeople.
“Subbies can basically name their price—(this is contributing to) really difficult conditions. There are still so many projects to come out of the ground. I believe subcontractors are asking really inflated prices.”
But the builders’ struggle is not reducing demand for housing—or prestige boats. Malaysian conglomerate Mulpha has invested heavily at its Sanctuary Cove Marina project, adding to its existing berth numbers with 25 new berths for the northern section of the marina basin—10 new 30m berths and 15 new 18m berths, coupled with 18 new jet ski docks.
Mulpha chief executive Greg Shaw said demand from larger vessels for the Australian coastline was only expected to grow and existing berths in the facilities were now fully occupied with existing customers.
“Ongoing investment in the marina, which hosts the Southern Hemisphere’s largest annual boat show, is crucial to our strategy to cater for the growing demand for world-class berthing, leisure and hospitality facilities that make Sanctuary Cove southeast Queensland’s premier lifestyle and leisure destination,” he said.
Others are snapping up the opportunity to make gains on property as population growth outstrips housing availability. driving up demand for apartments from buyers who would have traditionally purchased a house.
Construction of the $533m Burly Residences on the North Headland - designed by Koichi Takada - continues apace
The project by veteran developer David Devine occupies 40m of beach frontage with a mix of apartments, skyhomes and penthouses. Two-bedroom apartments start from $2.4m and construction completion is scheduled for the last quarter of 2027
The combination of strong population growth, dwindling building approvals, the lack of new construction starts and significant infrastructure investment in southeast Queensland has created a robust and stable market, conditions on which momentum will no doubt continue to build towards the 2032 Brisbane Olympic Games.
With southeast Queensland at the beginning of what property market commentators are calling a “golden decade”, now is the time to lock in today’s prices by purchasing an apartment off the plan, according to TOTAL Property Group managing director Adrian Parsons, who is also marketing the Chinese-owned Jewel apartment towers.
He foreshadows considerable capital gains over the next decade by buying off-the-plan apartments.
“Over the next decade we can expect steady price increases so we advise property buyers to act sooner rather than later and benefit from today’s prices,” Parsons said.
He said there was an undersupply of apartments across Queensland’s southeast and development completion levels were already low with few major projects commencing. This meant supply could not keep pace with underlying demand growth from very strong migration.
“Property prices are the highest we’ve seen in southeast Queensland, largely due to lack of new construction in the market, and this is expected to continue driving prices up.” he said.
Census data reveals Queensland’s annual population growth was 2.6 per cent in 2023 (above the national average of 2.4 per cent). It welcomed 138,470 new residents in 2023, bringing the population to an estimated 5.5 million, and the state government projects the population will approach 6.7 million by 2036.
As interstate migration to Queensland continues to exceed previous years, overseas migration hit record levels in 2023, with more than 60 per cent of Queensland’s growth gained from 84,000 people moving from overseas, according to the Australian Bureau of Statistics.
“Population growth combined with an extremely tight property market is underpinning the rise in house and apartment prices we have been seeing and this is only going to continue as Queensland gears up for the 2032 Olympic Games and basks in Olympics glow for the years to follow,” Parsons said.
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