The Strand. Picture: Evan Morgan
Townsville has weathered droughts and floods, the closure of major employers like the Yabulu nickel refinery, and, like the rest of the country, is now facing down a new enemy, the coronavirus pandemic.
But three property experts predict that Townsville will come out on top again
– Propertyology’s Head of Research Simon Pressley, REIQ CEO Antonia Mercorella and REA chief economist Nerida Conisbee.
The forecast is looking sunny for the Townsville property market. Picture: Evan Morgan
SIMON PRESSLEY
“Townsville is Australia’s largest city north of Brisbane, 14th largest overall, and the nation’s military capital.
“From the recently developed Cowboys NRL stadium, to new hotels, expansions of university and port infrastructure, a few major renewable energy projects and an expanding manufacturing sector, there’s a lot happening in Townsville.
“The local property market started to gain momentum in mid-2019 and this has continued throughout 2020.
“The first homebuyer market is taking advantage of good quality houses for under $400,000 while general activity among owner-occupiers is solid.”
Head of research at Propertyology, Simon Pressley.
NERIDA CONISBEE
“House prices have been pretty stable in Townsville in the past 12 months. Rental growth has been particularly positive, increasing by 4.5 per cent.
“Like the rest of Queensland, first homebuyer inquiry on realestate.com.au picked up significantly in the past 12 months, while investor activity has remained relatively flat. “Premium property is in high demand with Castle Hill and North Ward seeing the highest views per listing in Townsville on realestate.com.au”
REA chief economist Nerida Conisbee.
ANTONIA MERCORELLA
Real Estate Institute of Queensland CEO Antonia Mercorella Picture: Richard Walker
“The Townsville housing market was continuing its steady recovery at the commencement of this year – and it appears that state of play has continued over the first quarter.
“The median house price posted a small price reduction of 0.8 per cent with prices slightly lower, down 1.6 per cent over the year.
“The Townsville median house price for the year ending March was $315,000 – one of the most affordable in the state.
“The Townsville unit market also posted a small median price drop in the March quarter – down two per cent to just $235,000.
“Over the year ending March, its median unit price reduced by 1.8 per cent to $240,000.
“The region’s unit market remains challenging with prices yet to start firming in a significant way.
“Furthermore, in the nearby Whitsunday region, its heavy reliance on tourism is likely to impact both the house and unit markets over the medium term.”
“As for the rental market, the Townsville vacancy rate was 2.9 per cent at the end of March.
“And all indicators seem to point to tighter conditions in three months’ time.
“The volume of advertised rental properties has been steadily falling each month this year, with the number available now down about one third since the start of 2020.
“The insulated nature of the local economy has meant that the region’s rental market hasn’t suffered the same fate as many other locations it seems.”
Townsville floods. Aerial photos of The Strand from a helicopter. Picture: Zak Simmonds
BUT WHAT ABOUT QUEENSLAND?
Prior to the pandemic, Queensland was already on the relocation wishlists of many interstate buyers.
Now, with many people now working remotely, the experts believe they may soon make that move a reality.
“Prior to the outbreak of the COVID-19 pandemic, Queensland was the number one destination for interstate relocations – particularly from major metropolitan areas such as Sydney and Melbourne,” Ms Mercorella said.
“As this pandemic continues to affect us all, it’s introduced many of us to the possibility of a ‘new normal’ way of working – that is, remotely from home.
“And spending more time at home is seeing more people considering their options.
“As a result, interstate demand continues to strengthen in Queensland with the main drawcards being affordability, liveability and the lifestyle on offer.
“We anticipate this demand to surge in the coming year ahead as we navigate through to the other side of this pandemic.”
But its not just interstate migration that could boost the Queensland property market, Mr Pressley believes economic policies will take centre stage in the lead-up to Queensland election on October 31.
“The 17.7 per cent increase in the state’s population over the decade ending 2019 was the second highest in Australia,” he said.
“Unfortunately, the state’s unemployment rate was above the national average for all of the decade and this directly influenced underwhelming real estate markets right across Queensland.
“We are currently in a state election year and economic policy is certain to play a key role for both the election result and Queensland property markets.”
And first home buyers appear to already reaping the rewards thanks to a boost in grants.
Ms Mercorella said the number of first home buyers jumping onto the property ladder had remained “relatively steady” in the first quarter of the year, despite a sharp drop in new listings and overall real estate transactions.
“With post quarterly data showing moderate market stability, what we’ve witnessed is a strong increase in first homebuyer commitments,” she said.
“In fact, in Queensland they’ve literally doubled over the last three months, rising from 1501 in April to 3079 in May and 3023 June.
“These figures show that first-home buyers are possibly set to dominate the market for the first time in a long while – which is thanks to a combination of government stimulus, low interest rates, a change in investor behaviour and a rise in the rates of vacancy in rental properties.”
Data held by realestate.com.au also shows that Queenslanders are currently the most confident about buying and selling in the nation.
She said this was likely due to the state’s low levels of COVID-19 cases.
“And perhaps the realisation that Queensland is a pretty nice place to be if you’re going to be locked down,” she said.
Ms Conisbee said first home buyers are currently the most active market in Queensland, with first homebuyer inquiries having doubled compared to last year.
For existing housing, the realestate.com.au data showed that high-end, premium markets were also holding up well, and likely being driven by a “flight to quality” and the fact that job losses have been less felt by white collar workers.
Ms Conisbee said that investor activity remained slow and had dropped since last year, according to REA data.
“This will be the toughest market over the next 12 months,” she said.
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