Townsville Residential Property Overview QTR 1 l 2015
Harcourts Kingsberry Townsville 108 Charters Towers Rd Hermit Park Qld 4810 Ph: 07 4722 6500 W: www.townsville.harcourts.com.au
Townsville Residential Property Overview | QTR 1 | 2015
Introduction Area characteristics
Situated on the North Queensland coastline approximately 1,500 km north of Brisbane, Townsville is the largest tropical city in Australia and has emerged as one of the most dynamic regional cities in the country in recent years. The property market has been driven by solid economic and population growth which has provided a blend of opportunity and stability. Combined with world class infrastructure and recent lifestyle enhancements Townsville has cemented its position as the hub of North Queensland. The Townsville region has experienced strong and steady economic growth with an annual average increase of 9.8% over the past decade. The economy is resilient and currently has over $54 billion worth of mining, construction and infrastructure projects either underway or proposed for the Region.
Contents 1. Introduction 2. Townsville Property Market Sales Cycles & Price Points 3. Townsville Economy Overview 4. Rental Market 5. Tourism Market 6. Macroeconomic Climate 7. Feature Article: 2014 Townsville Property Market Review
– in
Townsville is quickly ascending in the national interest as northern economies and populations boom. Townsville is already the largest independent regional centre in Northern Australia, and is positioned to be the major beneficiary of the continued "rise of the north". Townsville is Northern Australia’s centre for public administration, education, research, health services, defence and a wide range of professional services. Furthermore, resident surveys reveal a dramatic increase in the liveability of the region. Anecdotally, people are moving to North Queensland for the opportunities and now staying for the lifestyle. Townsville has developed into a confident and vibrant city, attracting a wide range of new industries and investors who all recognise the growth opportunities the region has to offer.
Market summary
The Townsville property market has continued its overall flat trend, which commenced in the wake of the GFC in 2008. The enhanced first homers boost sparked a minor recovery in 2009, however this artificial dragging forward of demand could not be sustained. Housing sales volumes continue to be stagnant with low to no median price growth. The developer land market mirrors the housing market, with a prolonged period of low sales volumes. The $10,000 building boost grant announced during the 2011 State budget had little to no impact on stimulating demand. The abolition of the stamp duty concession for non first home buyer owner occupiers from 1 August 2011 has only exacerbated the low level of transactions. The unit market appears to have been less resilient than the housing market. Following a long period of clearing excess stock post the GFC, the median price has declined by 24.4 per cent over the past four years and sales volumes remain subdued. Stubbornly high unemployment remains a current challenge and has had a detrimental effect on vacancy rates. This has in turn impacted on consumer confidence which has been fragile in the wake of a down turn in the resources industry, reduced government infrastructure spending and mixed economic signals.
Harcourts Kingsberry Townsville 108 Charters Towers Rd Hermit Park Qld 4810 Ph: 07 4722 6500 W: www.townsville.harcourts.com.au
1
On a brighter note, policy initiatives to facilitate economic development and population growth in northern centres including Townsville are positive signs for the Townsville economy and property market in the medium to long term. The proposed inner city super stadium complex, with part funding promised pre State election will be a welcome boost to the city and may well be the catalyst required to turn around the local economy and property market. In the short to medium term, current market conditions combined with historically low interest rates provide an opportunity for owner occupiers and investors to enter the market while prices are subdued and before the recovery phase begins in earnest.
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
Townsville Residential Property Overview | QTR 1 | 2015
Townsville Property Market Sales Cycles Townsville House Market
Townsville City LGA House Sales Cycle $360,000
3000
No of sales Median Price 2500
$450,000 $400,000 $350,000
1 year median price growth: -2.7% 5 year median price growth: -0.5% P.A.
$300,000 $250,000
1000
$200,000
1232
1449
1500
Median price
2000
No of sales
Over the past 10 years, the Townsville housing market experienced peak sales volumes in 2006 and 2007, however a significant slowing in both sales volumes and median price growth occurred during 2008. The enhanced first home owners grant fuelled a minor recovery in 2009, however this artificial dragging forward of demand resulted in new sales volume lows in 2010 and early 2011. In the six months ending September 2014, 1,232 transactions occurred, to give an annual total of 2,681 sales. This compares to the previous twelve month total of 2,699 sales and a ten year average of 3,331 sales per annum.
$150,000 $100,000
500
The Townsville median house price has been relatively flat since 2007. The median house price was $360,000 during the six months ending September 2014, retracting by 2.7 per cent from 12 months earlier. Median price growth over the past five years has been near flat at -0.5 per cent per annum.
$50,000
Mar-14
Sep-14
Mar-13
Sep-13
Mar-12
Sep-12
Mar-11
Sep-11
Mar-10
Sep-10
Mar-09
Sep-09
Mar-08
Mar-07
Sep-07
Sep-06
Sep-05
Sep-08
Half year
Prepared by 3D Property Consulting, Source: PDS Live
Price Points
Townsville City LGA House Price Points Year Ending September 2014
During the year ending September 2014, the dominant price point was the $300,000 to $400,000 bracket, which accounted for 40% of all house sales. The next highest concentration occurred in the $400,000 to $500,000 price point with 24% of all sales. 13% of sales occurred over the $500,000 price point, which is a reduction from previous years.
>$1m 13 sales (0%) $750k-$1m 56 sales (2%)
<$200k 60 sales (2%)
$500k-$750k 282 sales (11%)
$200k-$300k 556 sales (21%)
$400k-$500k 655 sales (24%)
Some of the more significant house sales during the twelve months include a house in The Point at Castle Hill which sold for $2,050,000, a Norfolk Pl house in Douglas which sold for $1.245m, a house on the Strand North Ward which sold for $1.2m and a house on Saltwater Dv at Toomulla Beach which fetched $1.23m. The upper end sales are now showing a wide geographical spread, rather than being confined to Castle Hill and surrounding coastal suburbs.
$300k-$400k 1059 sales (40%)
Prepared by 3D Property Consulting, Source: PDS Live
Townsville City LGA Peak House Selling Periods 300
Peak Selling Periods
250
Median No of Sales
The graph to the right shows the median number of house sales per month over the past ten years and illustrates the high and low points throughout the year. October and November are the peak selling months, followed by February and March. The low period is June and December.
Mar-06
$0 Mar-05
0
200
150
100
50
Prepared by 3D Property Consulting, Source: PDS Live
2
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
Month
December
November
October
September
August
July
June
May
April
March
February
January
0
Townsville Residential Property Overview | QTR 1 | 2015
Townsville Property Market Sales Cycles Townsville Land Market
Price Points The Townsville land market displays a good spread of price points reflecting the range of product on offer. The dominant price point in the year ending September 2014 was the $150,000 to $175,000 price point, which represented 35% of all sales. Sales above $250,000 accounted for 11% of market activity. The highest priced residential land is concentrated in the prime suburb of Castle Hill, however premium prices have also been achieved in suburbs including Douglas, Idalia, Nelly Bay (Magnetic Island) and Bushland Beach. These sales are dispersed across a wide geographic area.
$165,000
1400
No of sales Median Price 1200
The graph to the right shows the distribution of lot sizes for all land sales recorded during the year ending September 2014. The under 450 m2 bracket has grown its share substantially over recent years, rising from just 2% of sales in 2011 to now representing 20% of sales in the year ending September 2014. This reflects a change in town planning philosophy and appears to have been accepted by the market. The 451 to 600 m2 bracket has the highest proportion with 26 per cent of sales, followed by the 601 to 750 m2 bracket accounting for 22 per cent of sales.
$100,000 600
518
498
$80,000
400
$60,000 $40,000
200 $20,000
Mar-14
Half Year Prepared by 3D Property Consulting, Source: PDS Live
Townsville City LGA Land Price Points Year Ending September 2014 >$250,000 114 sales (11%) $200,000-$250,000 90 sales (9%)
<$125,000 75 sales (7%) $125,000-$150,000 181 sales (18%)
$175,000-$200,000 205 sales (20%)
$150,000-$175,000 351 sales (35%)
Townsville City LGA Lot Sizes Year Ending September 2014
>1200 m2 186 sales (18%)
<450 m2 208 sales (20%)
901-1200 m2 51 sales (5%) 751-900 m2 93 sales (9%)
Prepared by 3D Property Consulting, Source: PDS Live
Sep-14
Mar-13
Sep-13
Mar-12
Sep-12
Mar-11
Sep-11
Mar-10
Sep-10
Mar-09
Sep-09
Mar-08
Sep-08
Mar-07
Sep-07
Mar-06
Sep-06
$0 Mar-05
0
601-750 m2 228 sales (22%)
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
$120,000
Median Price
800
451-600 m2 250 sales (26%)
3
$180,000
$140,000
1 year median price growth: -0.3% 5 year median price growth: -0.2% P.A.
Prepared by 3D Property Consulting, Source: PDS Live
Lot Sizes
$200,000
$160,000 1000
Sep-05
The median land price peaked in 2008 at $178,000 and has been relatively flat since June 2009. In the six months ending September 2014, the median land price was $165,000. The lack of price growth combined with increased infrastructure and development costs has placed downward price pressure on englobo site values.
Townsville City LGA Land Sales Cycle
No of Sales
The ten year sales cycle for the Townsville land market mirrors the prevailing economic conditions well, with a steady rise in sales volumes from 2001 to the end of 2007. Sales volumes plummeted during 2008 and bottomed out in 2011. 498 transactions were recorded during the six months ending September 2014, to give an annual total of 1,016 sales. This is well below the ten year average of 1,388 sales per annum. Sales volumes have remained subdued since 2007.
Townsville Residential Property Overview | QTR 1 | 2015
Townsville Property Market Sales Cycles Townsville Unit Market
Price Points
Most sales in the Townsville unit market in the year ending September 2014 were concentrated in the $200,000 to $300,000 price point, with 32 per cent of sales, followed by the $300,000 to $400,000 bracket with 26 per cent of sales. 12 per cent of all sales occurred over the $500,000 price point, a similar proportion to the housing market and significantly lower than the 19 per cent recorded in 2011. This reduction in activity in the upper end of the market is a reflection of increased interest in affordable units which offer a solid rental yield. Most top end sales were recorded for units located within ‘Mariners Peninsula’ (‘The Stanton Apartments’) and ‘Solarus’.
1000
$400,000
$272,500
No of sales Median Price
900 800
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
$300,000
500
$200,000
400
358
352
$150,000
300
$100,000 200 $50,000
100
Half Year Prepared by 3D Property Consulting, Source: PDS Live
Townsville City LGA Unit Price Points Year Ending September 2014 $750k-$1m 20 sales (3%) $500k-$750k 55 sales (8%) $400k-$500k 57 sales (8%)
>$1m 6 sales (1%) <$200k 157 sales (22%)
$300k-$400k 182 sales (26%) $200k-$300k 233 sales (32%)
Mar-14
Sep-14
Mar-13
Sep-13
Mar-12
Sep-12
Mar-11
Sep-11
Mar-10
Sep-10
Mar-09
Sep-09
Mar-08
Sep-08
Mar-07
Sep-07
Mar-06
Sep-06
$0 Mar-05
0
Median Price
$250,000
1 year median price growth: -11.5% 5 year median price growth: -4.0% P.A.
600
Prepared by 3D Property Consulting, Source: PDS Live
4
$350,000
700
Sep-05
The median unit price for the six months ending September 2014 was $272,500, based on 352 transactions. This is 11.5 per cent lower than 1 year earlier when the median unit price was $307,750. Over the past five years median price growth has been -4.0 per cent per annum.
Townsville City LGA Unit Sales Cycle
No of Sales
The Townsville unit market has experienced a similar trend to the housing market over the last 10 years. Sales volumes peaked in 2006/2007 and declined rapidly during 2008. A ten year low of 307 sales occurred in June 2011. During the most recent six months ending September 2014, 352 sales were recorded, to give an annual total of 710 sales. This compares to 715 sales during the previous year and a ten year average of 1,050 sales per annum.
Townsville Residential Property Overview | QTR 1 | 2015
Townsville Economy Overview Population growth
Townsville City LGA Estimated & Projected Resident Population 350,000
Change 2012 to 2013: 2.03% (3,586 people) 300,000
250,000
189,238
200,000
150,000
100,000 2004
2005
2006
2007
5
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
2008
2009
2010
2011
2012r
2013p
2016
2021
2026
2031
2036
Year to June Prepared by 3D Property Consulting, Source: ABS & OESR
Economic Growth
The key to the strength of the Townsville economy lies in its diversity. Major contributions are generated from public administration and safety, rental hiring and real estate services, manufacturing, mining, construction and health care and social assistance. Gross Regional Product (GRP) for the northern region increased 8.6% from 2009-10 to 201011 to reach $12.44 Billion. Townsville is the trade centre for the vast North West Queensland minerals province and the port experienced seventeen years of consecutive trade growth to exceed 10 million tonnes per annum in 2003-2004 and has handled record tonnage during 2011-12. Townsville is an internationally significant base metals processing centre and is home to three major metal refineries including Xstrata’s Copper Refinery at Stuart, Sunmetal’s Zinc Refinery at Stuart and Clive Palmer’s QNI Nickel Refinery at Yabulu. The defence forces based in Townsville have been subject to major expansion over the past decade, highlighted by the recent relocation of the 3RAR light infantry battalion including 1,500 soldiers and support staff, from Holsworthy in Sydney to Townsville’s Lavarack Barracks. Townsville is also home to James Cook University and a number of research institutions and is developing as a world leader in tropical science and sustainability. This economic diversity is the key to the strength of the Townsville economy and underpins a sound and stable property market.
314,362
Annual Forecast Change 2016 to 2036: 2.2% (5,524 people P.A.)
Population
Townsville’s consistent population growth is likely to be a major driver of dwelling demand in the future. In the year ended June 2013, the Townsville City population grew 2.03% according to the ABS, increasing by 3,586 people to reach a total of 189,238 people. Net migration has been the major driver of recent population growth, reflecting strong employment growth. The Townsville population has grown by 2.9 per cent per annum over the past five years, with Queensland Government projections (medium series) indicating the population is expected to reach approximately 314,362 people by 2036. Considering the Townsville average dwelling size is 2.7 persons, this growth equates to an average derived demand of approximately 2,000 new dwellings per year needed to house the growing population over the next 23 years. Forecast demographic changes including a reduction in the number of persons per household (household size) will increase the underlying demand for dwellings even further in future years.
Gross Regional Product Wholesale trade
Townsville Queensland
Transport, postal & warehousing Retail trade Rental, hiring & real estate services Public administration & safety Professional, scientific & technical services Other services Mining Manufacturing Information media & telecommunications Health care & social assistance Financial & insurance services Electricity, gas, water & waste services Education & training Construction Arts & recreation services Agriculture, forestry & fishing Administrative & support services Accommodation & food services 0.0%
2.0%
Prepared by 3D Property Consulting, Source: Townsville Enterprise
4.0%
6.0%
8.0%
10.0%
12.0%
%age Contribution
14.0%
16.0%
18.0%
20.0%
Townsville Residential Property Overview | QTR 1 | 2015
Rental Market Residential Vacancy Rates
Vacancy Rates Down • The REIQ conduct a quarterly survey to determine residential vacancy rates in Local Government Areas across Queensland. • Townsville vacancy rates are calculated by using information provided by local real estate agents. • The number of vacant properties on rent rolls divided by the total number of rental properties available determines the overall vacancy rate. • Residential vacancy rates across Townsville were 4.8 per cent in September 2014, down from 5.4 per cent in June 2014. •Although this is a significant improvement, it is still well above the accepted balanced market benchmark of 3 per cent. •Stubbornly high unemployment has reduced demand, creating a temporary surplus of accommodation supply. • Vacancy rates have decreased in most other regional Queensland centres including Rockhampton, Gladstone and Bundaberg, apart from Mackay which increased to 8.4%.
LGA
Sep-14
Trend
Townsville
4.8%
Down
Cairns
1.8%
Steady
Mackay
8.4%
Up
Rockhampton
4.1%
Down
Gladstone
4.7%
Down
Toowoomba
1.6%
Steady
Sunshine Coast
1.1%
Steady
Gold Coast
1.9%
Steady
Greater Brisbane
2.0%
Down
Source: REIQ
Rental Rates Trend Lower • Analysis of new rental bonds lodged with the Residential Tenancy Authority (RTA) is the basis of the median weekly rents information. • The median rents are calculated for different types of dwellings in major centres throughout Queensland. • In December 2014, the Residential Tenancy Authority held a total of 13,342 bonds for houses and 9,207 bonds for units and townhouses in Townsville. • Rents have generally fallen across the board during the year ending December 2014. • Analysis of median weekly rentals by postcode shows that the upper Ross offers the most affordable housing, while the inner city areas in the 4810 postcode are generally the least affordable. • The highest median rent of all dwelling types was $450 per week for 4 bedroom houses in the inner city postcode of 4810 and $450 per week for 3 bedroom units in the inner city postcode of 4810. • Rents may continue to come under downward price pressure until vacancy rates return to a balanced market level.
6
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
Median Weekly Rents Dwelling Type 2 bed units 2 bed units 2 bed units
Area Postcode area 4810 Postcode area 4814 Townsville City LGA
3 bed units 3 bed units 3 bed units
Postcode area 4810 Postcode area 4814 Townsville City LGA
$450 $355 $370
$450 $330 $390
0.0% 7.6% -5.1%
2 bed townhouses Postcode area 4810 2 bed townhouses Townsville City LGA
$260 $270
$310 $280
-16.1% -$50 -3.6% -$10
3 bed townhouses Townsville City LGA
$340
$350
-2.9%
-$10
3 bed houses 3 bed houses 3 bed houses
Postcode area 4810 Postcode area 4814 Townsville City LGA
$350 $330 $320
$350 $340 $340
0.0% -2.9% -5.9%
$0 -$10 -$20
4 bed houses 4 bed houses 4 bed houses
Postcode area 4810 Postcode area 4814 Townsville City LGA
$450 $400 $380
$450 $420 $400
0.0% -4.8% -5.0%
$0 -$20 -$20
Prepared by 3D Property Consulting, Source RTA
Dec-14 Qtr Dec-13 Qtr 1 Yr Change Rent ($) Rent ($) % $ $290 $300 -3.3% -$10 $280 $270 3.7% $10 $280 $280 0.0% $0 $0 $25 -$20
Townsville Residential Property Overview | QTR 1 | 2015
Townsville Tourism Overview Townsville Airport Arrivals
Townsville Airport has played a significant role in the growth of the aviation sector in the North Queensland region, and is home to the Northern Australian Aerospace Centre for Excellence (NAACEX). The airport is a jointly shared facility with the Department of Defence. Townsville Airport has direct services to Brisbane, Melbourne, Sydney, Cairns, Darwin, Mackay, Mount Isa, Longreach and Rockhampton as well as various mining destinations. Passenger movements through the Townsville airport have fallen slightly, due to the soft business and leisure travel market. Just under 1.6 million passengers passed through the Townsville airport in the year ending June 2014 representing a decrease of approximately 4.0 per cent from the previous year.
Airline Seat Capacity
Townsville Airport Passenger Movements 1,800,000 1,600,000
20.00%
Passengers % Growth 15.00%
1,400,000 1,200,000
10.00%
1,000,000 5.00%
800,000 600,000
0.00%
Growth (%age)
Passenger Numbers
• As at September 2014, weekly domestic seat capacity into Townsville is estimated at approximately 18,250 seats (includes interstate services and intrastate flights from Brisbane only). • Carriers include Qantas, Virgin Blue and Jetstar. Airnorth also operate a service to Darwin. • Regional carriers include Qantaslink, Alliance and Rex. • Strategic Airlines have ceased their international fights to Bali.
400,000 -5.00%
Visitor Numbers
200,000 0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 • The Townsville region hosted 936,000 domestic overnight Year ending June Prepared by 3D Property Consulting, Source: Qld Airports Ltd visitors in the year ending June 2014, comprising mainly of intrastate visitors (82 per cent). • The visitor profile is shared across the three market sectors of holiday (329,000), visiting friends and relatives (VFR) (356,000) and business visitors (197,000), spreading the risk Townsville Region YE June 2014 Tourism Visitation Highlights and not relying on any one market sector, as do some of Total Vistors Holiday VFR Business the neighbouring regions. Domestic overnight 936,000 329,000 356,000 197,000 • Domestic visitors account for 91 per cent of all visitors to Annual change 5.4% 7.2% 22.8% 5.3% the region. • Interstate visitors account for 18 per cent of domestic International overnight 96,000 75,000 15,000 7,000 visitors yet account for 34 per cent of visitor nights. Annual change 15.5% 17.7% 9.5% n/p • International source markets are concentrated in Europe Prepared by 3D Property Consulting, Source: Tourism Queensland (UK, Germany and balance of Europe), with New Zealand and USA also significant markets.
7
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
-10.00%
Townsville Residential Property Overview | QTR 1 | 2015
Macroeconomic Climate Inflation Dips Below RBA Target
Inflation 6%
4%
Reserve Bank's Target Range 2%
0%
8
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
Dec-14
Dec-13
Dec-12
Dec-11
Dec-10
Quarter
Housing Loan Interest Rate 12.0
10.0
5 .9 5
8.0
6.0
4.0
D e c -1 4
D e c -1 3
D e c -1 2
D e c -1 1
D e c -1 0
D e c -0 9
D e c -0 8
D e c -0 7
D e c -0 6
D e c -0 5
D e c -0 4
D e c -0 3
D e c -0 2
D e c -0 1
D e c -0 0
D e c -9 9
D e c -9 8
D e c -9 7
D e c -9 6
D e c -9 5
2.0
Month
Prepared by 3D Property Consulting Source: RBA Bulletin, last updated Feb-15
RBA Commodity Price Index 160.0
RBA commodity price index value
140.0
120.0
100.0
80.0
60.0
40.0
20.0
ec -
14
13 D
12
ec -
ec D
D
10
11 ec -
ec D
D
09 ec -
ec D
D
ec D
08
07
05
06 ec -
ec D
Month
D
03
04 ec -
ec D
D
01
02 ec -
ec D
D
99
00 ec -
ec -
Prepared by 3D Property Consulting Source: RBA Bulletin G5, last updated Feb-15
D
ec -
98 D
D
D
ec -
97
96
95 De c-
De c-
D
ec -
94
0.0
S ta n d a rd V a ria b le B a n k H o u s in g L o a n In te re s t R a te (% )
14.0
Commodity Price Growth in Decline • The RBA’s Commodity Price Index provides an indicator of primary commodity price movements. • The index includes 17 commodities with separate weightings, the highest of which are coal, gold and iron ore. • Commodity price growth has decreased by 18.6% in AUD terms during 2014, following a recovery during 2010 and into 2011. • The decline is largely due to falls in prices of bulk commodities, including iron ore and oil. • With exports now equivalent to almost 25 per cent of GDP, developments in export prices can have a significant influence on economic activity. • Current terms of trade have declined from their historic peak in September 2011, easing pressure on exchange rates.
Dec-09
Prepared by 3D Property Consulting Source: ABS Cat No: 6401.0, last updated feb-15
Interest Rates Stable • The housing loan interest rate is the average variable rate of interest being offered by housing lenders. It is higher than the RBA’s target cash rate due to lending costs and profit margins, with the standard variable bank housing loan interest rate at 5.95% in December 2014. • Interest rates are set by the RBA, who acts independently of government and sets interest rates with the goal of maintaining inflation in a long-run target range of 2 - 3%. The RBA meets monthly to review the current interest rate. • The RBA have held the cash rate steady at 2.50% since August 2013, down from a peak of 4.75% from November 2010 to October 2011. This followed seven rises from the previous bottom of the cycle post GFC in April-09, when the cash rate was 3.0%. • With low inflation, relatively high unemployment and continued weakness in some international markets, rates are likely to remain stable for some time, with many economists predicting rate cuts throughout 2015. .
Dec-08
Dec-07
Dec-06
Dec-05
-2%
Annual change in CPI (All Groups)
8%
Dec-04
• The Reserve Bank of Australia (RBA) aims to constrain inflation in a long-run target range of 2-3% through the setting of interest rates. • The December-14 CPI figures recorded an annual change of 1.7% which is below the RBA’s target range. • Quarterly inflation was 0.2% up in the December-14 quarter, down from the 0.5% rise in the September-14 quarter. •The most significant price rises this quarter were for domestic holiday travel and accommodation (+5.8%), tobacco (+4.8%) and new dwelling purchase by owneroccupiers (+1.1%). •The most significant offsetting price falls this quarter were for automotive fuel (-6.8%), audio, visual and computing equipment (-5.2%) and audio, visual and computing media and services (-3.8%). •Inflation is expected to be consistent within the 2-3% target range over the next two years, providing a period of stability in interest rates.
Townsville Residential Property Overview | QTR 1 | 2015
Feature Article: 2014 – Townsville Property 2014 continued to be another challenging year for the Market in Review Townsville residential property market. Sales volumes remained subdued and median price growth declined.
Townsville City LGA House Sales Cycle YE Sep-2014 300
$385,000
No of sales $380,000
Median Price 250
$375,000 $370,000
200
$365,000 $360,000
150 $355,000 $350,000
100
$345,000 $340,000
50
$335,000
Prepared by 3D Property Consulting, Source: PDS Live
Sep-14
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
Jan-14
Dec-13
Oct-13
$330,000 Nov-13
0
Residential vacancy rates remain well above the balanced market level, placing downward pressure on rental rates which have steadily declined throughout the year. Agents report some rental incentive activity as landlords compete to attract suitable tenants.
Month
Townsville City LGA Land Sales Cycle YE Sep-2014 120
Apr-14
‘Current market conditions present an excellent opportunity for owner occupiers and investors to enter the market, before the recovery phase begins in earnest.’ Townsville City LGA Unit Sales Cycle YE Sep-2014 100
$350,000
No of sales Median Price
90
$300,000 80
60
$200,000
50 $150,000
40 30
$100,000
20 $50,000 10
Sep-14
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
Jan-14
$0 Dec-13
0
Median Price
$250,000
70
Month
TOWNSVILLE RESIDENTIAL PROPERTY OVERVIEW
Median Price
Month Prepared by 3D Property Consulting, Source: PDS Live
Prepared by 3D Property Consulting, Source: PDS Live
9
Sep-14
$145,000 Aug-14
0 Jul-14
$150,000
Jun-14
20
May-14
$155,000
Mar-14
40
Feb-14
$160,000
Jan-14
60
Dec-13
$165,000
Nov-13
80
Oct-13
No of Sales
$170,000
Nov-13
The Townsville residential property market is at or near the bottom of the property market cycle and is highly likely to enter a strong recovery phase during 2015. Current market conditions present an excellent opportunity for owner occupiers and investors to enter the market, before the recovery phase begins in earnest. Post the January 2015 State election, economic activity and unemployment is widely forecast to improve. These factors combined with historicaly low and stable interest rates, make a compelling case for buying Townsville residential property sooner rather than latter.
100
Oct-13
The house sales cycle graph for the 12 months ending September 2014 illustrates the relatively volitile year. Sales volumes peaked in Nov-13 and Feb-14 and were steadier in the final 3 months of the year. The median sale price trended upwards for the first 5 months, then trended lower between Feb-14 and Sep-14. Land sales peaked in May-14 and have trended downwards since this time. Median land prices displayed some volitility during the first 6 months of the year however have been more stable for the final 6 months to Sep-14. Sales volumes of units fluctuated throughout the year however trended upwards in the final 2 months. Following a genaral downward trend, the median unit price kicked up strongly in September.
$175,000
No of sales Median Price
No of Sales
‘The stubbornly high local unemployment level had a detrimental affect on business and consumer confidence, which flowed through to a continued weakness in the residential property market.’
Median price
No of sales
Promising signs at the start of the year failed to be sustained throughout 2014. The stubbornly high local unemployment level had a detrimental affect on business and consumer confidence, which flowed through to a continued weakness in the residential property market. Average days on market and average vendor discounting for houses remained relatively steady throughout the year. According to the REIQ, during the September 2014 quarter, average days on market sat at 89 days and average vendor discounting remained at 7.4 per cent.
Prepared by 3D Property Consulting, 0429 433 018 Source: ABS, Bureau of Meteorology, PDS Live, Queensland Airports Ltd, RBA, REIQ, RP Data, RTA, Tourism and Events Queensland, Townsville City Council. Use with written permission only. All other responsibilities disclaimed. Š 2015
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