- Median prices have leapt over $300K from pre-pandemic levels
- Weekly asking prices have been in the seven figures
- Land is king, with buyers turning away from apartments
The latest house and home price indexes were released by PropTrack and CoreLogic yesterday, with the bottom of the market potentially well behind us.
Propping up the market is a sustained lack of listings and a continued mounting demand. PropTrack noted that supply began to ease but the flow of new listings remained soft.
House prices across the nation continued to rise, but remain below the record levels seen across the Covid years.
Sunshine Coast real estate market
The Sunshine Coast housing market has seen supply gradually reducing since 2012, before bottoming out around 2018, according to SQM data.
The Covid plunge saw the number of properties listed on the Sunshine Coast go from a 2019 peak of some 10,000 to a low point of barely half that figure. The latest from SQM shows over 6,300 listings for the Sunshine Coast, with about three quarters comprising houses, the remainder units.
While stock on market hurtled downward, prices mirrored the movement upward.
Sunshine Coast property values for houses on the Sunshine Coast leapt from just under $1.4 million in March 2020 to a February 2022 peak of $1.8 million.
As for medians, the Sunshine Coast house prices were previously around $610,000, now $970,000 in February this year, according to Domain.
“We have observed a remarkable surge in demand for properties on the Sunshine Coast in the past month,” said Jordan Navybox, Managing Director Cohen Handler Queensland.
Such is the surge, Navybox said the agency has added two more Buyer’s Agents to serve the area exclusively in response to the heightened interest.
The Property Baron‘s Jason Baron observed that different segments of the market have performed very differently, however:
“Overall, we have seen a correction in the market from the peak in about May last year. Some of the Noosa shire suburbs have been the hardest hit but they were also the suburbs that led the way through the recent boom market.”
Jason Baron, Director – Buyers Agent, The Property Baron
The Sunshine Coast rental market is seeing low vacancy rates, similar to the national figures. The latest from SQM is 1.6%, with 849 rentals available on market.
So, what’s in store for 2023?
A rigid dichotomy between buyers and sellers may be emerging.
Baron told The Property Tribune that buyers are not jumping in as quickly as they were in early 2022 and before.
“Buyers are expecting more negotiating power in the transaction but they are not necessarily getting this as sellers are still holding firm on their expectations in many cases.”
Jared Candlin, Cohen Handler Head of Growth & Buyers Agent, told The Property Tribune that while the market stock levels remain tight, the off-market scene has expanded.
“Sellers now need to be more accurate with their pricing, as overpriced properties tend to linger on the market and eventually sell for less than their potential value.
Baron likewise noted sellers need to be putting in the hard yards.
“Selling agents have needed to work harder to get a sale done as the market has been adjusting and buyers have not been as confident to jump in to make a purchase.
“It seems there have been fewer listings on the market, recently, which tells us agents are finding it more difficult to list properties as the year goes on. It will be interesting to see if this continues and how this will affect the market.”
Cost of living and rate headwinds blow
The Sunshine Coast property forecast includes patchy cloud cover and a strong northerly gust, with interest rate uncertainty potentially continuing through the year.
Baron said “Buyers are needing to deal with lower and lower borrowing capacity as interest rates have continued to rise.”
In a March article, The Property Tribune reported on data that showed, in some circumstances, borrowing power was slashed by over $200,000.
Headwinds are also blowing on the Sunshine Coast real estate market, with Baron observing: “The biggest factor being interest rate increases. Every time there is an increase it affects the market and there has been plenty of increases.”
“The market is facing mounting pressure from increasing living standards and costs, which has made buyers more cautious and hesitant to commit to purchases.”
Jared Candlin, Head of Growth & Buyers Agent, Cohen Handler
Selective tightening of purse strings
The market may be in a curious state of flux as the year progresses. While inflation and interest rates weigh on the minds of buyers and sellers, the latest national price movements show the market may have bottomed out, and even that the fear of rising interest rates may be loosening its grip.
Candlin said that while the cost of living shackles remains firmly fixed, there are still plenty of buyers in the Sunshine Coast property market.
“Buyers are willing to offer competitive prices if they feel comfortable with the purchase. However, the expectation of negotiation remains strong, and if sellers are unwilling to negotiate, there are enough other buyers who will.”
Baron noted if interest rates where they are or continue to increase this year, the Sunshine real estate market is likely to be fairly slow.
“However, if there continues to be low stock volumes coming to market this may help to hold prices up as there would be more buyers competing for fewer properties,” said Baron.
“In saying that, some of the data coming out from the likes of CoreLogic suggests that the bottom of the market, in general, might be behind us and there is also the big factor of very low supply in general on the Sunshine Coast and the demand seeming to constantly be increasing which would suggest our market is likely to perform strongly against other markets over the coming years.”
Saying no to apartments
Among other trends picked up by experts in the industry, Candlin noted that buyers are focussing more on lifetime investments:
“One interesting observation is that ‘land is king’.”
“Buyers are shifting their focus away from properties with body corporate fees and towards more secure investments in bricks and mortar.
“This trend is particularly notable in the investment space, where buyers value the stability and long-term potential of land ownership.”
Jared Candlin, Head of Growth & Buyers Agent, Cohen Handler
