THE PROPERTY DEVELOPMENT REVIEW
of very affluent buyers. This has driven the prices of those properties up further, in some cases well beyond market expectations. Beachfront homes and certain waterfront properties, particularly those on Main River and in point positions are in high demand and performing well as a result
How is the residential investment market performing in your area?
Residential investment markets, in terms of capital appreciation, have performed extremely well. While the vacancy rate has eased marginally on the Gold Coast recently, it is still very tight, and rents remain reasonably high. I think some of the changes to rental legislation that the state government is introducing, which includes restricting the level of rent landlords can ask for their properties, are nonsensical. Ultimately, it has the potential to deter investors from entering, or remaining in, the rental market, which will further impact the housing availability in the wider market. Despite an increase in the cost of living, property values have remained relatively stable – how do you anticipate the remainder of 2024 will be in terms of market activity & transaction volumes? Market activity and transaction volumes have stayed relatively steady throughout the trends we’ve seen this year. I expect this will continue as we move through the remainder of 2024, despite increased cost of living pressure. With a more stabilised interest rate environment and the possibility that the Reserve Bank may announce a drop in the cash rate by early February, confidence is growing among both buyers and sellers. So, while we may not see dramatic growth in the short-term, once interest rates do eventually start to fall, it will ‘normalise’ the market and reignite future house price growth. What are the fundamentals that are driving investment & purchasers in your local market area and where are the opportunities for sophisticated investors / developers? There is a lot of interest from owner buyers and investors in properties to which they can add value, particularly in the commercial sector. Our commercial department has seen growth in enquiry levels for B and C-grade assets that offer more potential for value-adds and therefore increased returns. With A-grade assets, in most instances, the value has already been absorbed so you are buying them as a passive investment based on yield potential. In the residential market, certain sectors are performing quite well, including apartments. Sophisticated investors are focused on low-density development sites, where they can get builders, alongside the land subdivision market, which is another sector that has been performing very well.
September / October 2024 – 95
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