In the cyclical nature of economic peaks and troughs, investors are always seeking opportunities to capitalise in both markets, and of course, somewhere in-between…to maximise potential gain and minimise risk, timing is critical.
When looking at the context surrounding the build-up to a boom, there are three key elements required to create an environment that drive, and in the Sunshine Coast’s case, sustain, a ‘boom’ for an unprecedented time period.
- Strong economic growth
- Increased demand
- Pressure on supply
These three ingredients work in synchronicity to generate a boom; at present the Sunshine Coast has been identified by economic and property commentators, including the Real Estate Institute of Queensland, as the Queensland region with the largest potential in 2017.
The driving force of the Sunshine Coast boom has been a massive infrastructure program spearheaded by the multi-billion dollar hospital development and health hub at Birtinya, new residential developments such as Stockland’s $63 million Oceanside Retirement Village, new SunCentral CBD in Maroochydore, $400 million expansion of Sunshine Plaza, $110 million expansion of Kawana Shopping World, $400 million water park at Glenview, multi-billion dollar City of Aura in Caloundra South (creating a city with the population size of Gladstone), $1.13 billion Bruce Highway upgrade and the $600 million Sunshine Coast Airport expansion…to name just a few.
This huge injection of capital from both private and public sector has created much needed employment opportunities in the region, which then results in increased demand for housing and services. Business and investor confidence is fuelled by the activity and this then drives more investment, having somewhat of a multiplier effect.
It’s not just the infrastructure activity that has attracted investors to the Sunshine Coast, internal migration from intra and interstate is also a factor; with our temperate climate, diverse natural beauty mountains to ocean – lifestyle is a driver that cannot be underestimated.
Baby-boomers/downsizers seeking a ‘sea’ or ‘tree’ change lead the charge, but also young families seeking a better quality of life, and also an increasing amount of white collar professionals from capital cities who, due to technology, can basically work from home, it is no longer essential for some workers to live in the region where they are employed. Housing affordability is another factor attracting migration…why pay Sydney prices, whether renting or purchasing, if you can work from home, on the Sunshine Coast!
Another important element of the growth we are experiencing is that it is (mostly) growth that generates long-term employment, as opposed to the mining town booms where the work is gone once the demand for the resource wanes, or indeed the availability of the resource reduces.
The Sunshine Coast is experiencing demand for housing that exceeds supply, this has been driving up price growth as stock levels tighten; savvy investors are identifying this and purchasing property with confidence and a heightened sense of security. Over the last five years, it was estimated we needed approximately 2,200 new dwellings per annum to meet demand; only circa 1,800 per annum was achieved – the shortfall has meant very low vacancy rates, and upward pressure on house prices and rentals. In the short-medium term, even on the back of major developments like Aura, supply will still be tight, and still be outstripped by demand.
All of the above bodes very well for investors; the future is looking very bright indeed, and one can invest in this region with great confidence and security. Talk to us at Investor Property about how you can grow your wealth through property.