WHY ARE WE SEEING MORE MILLION-DOLLAR SUBURBS ON THE SUNSHINE COAST AND WHAT IS NEXT? No longer a sleepy ‘beach town’, the Sunshine Coast is a growing regional centre well on its way to challenging the biggest cities in Australia when it comes to growth and investment. In the last year alone we’ve seen a…
WHY ARE WE SEEING MORE MILLION-DOLLAR SUBURBS ON THE SUNSHINE COAST AND WHAT IS NEXT?
No longer a sleepy ‘beach town’, the Sunshine Coast is a growing regional centre well on its way to challenging the biggest cities in Australia when it comes to growth and investment. In the last year alone we’ve seen a number of unsuspecting suburbs crack into the million-dollar club for house sales. It feels like not too long ago the thought of a million-dollar home took your mind to a massive mansion on the water…now it may not even get you 824 square metre home in the Aura housing estate (which sold for $1,025,000 in February), or a 918 square metre home in Nambour (which sold for $1,100,000 in September). These areas – which were once considered affordable suburbs for growing families – are proof the Sunshine Coast is evolving at a fast rate.
At the time of writing this article, online there were around 945 homes advertised for more than a million dollars, and around 1500 homes advertised for under a million dollars on the Sunshine Coast. Here at Direct Collective, we predict these numbers will likely become even closer together, and then the million-dollar club will no doubt start dominating the listings.
So what is driving this?
It all comes back to the massive undersupply we are currently experiencing. There’s a common misconception being made by not just residents, but also Sunshine Coast Council, that the current tight housing market is a ‘boom’ caused by COVID-19. Due to a lack of proper planning, this pressure has actually been building up over the past 10 years on the Sunshine Coast. It’s also inline with a nationwide reduction due to tightening of credit over 2017 to 2019. The pandemic has just fast-tracked the tipping point and is being used to hide some of the wider failures. This means the price growth is unlikely to slow down anytime soon.
People often say the Sunshine Coast is an expensive place to live but the reason they say that is based on the average income vs median house prices. What is often misunderstood is that this measure actually misses the true capacity and the truth that we’re living in the most entrepreneurial city in Australia. This means we have more small businesses per capita than anywhere else…and small businesses are really good at minimising tax which results in a lower income average than is actually the case. On top of this there’s also a disproportionate number of self-funded retirees who spend a lot of money and have a lot of property, but ‘technically’ have no income. Rather than looking at average income, we should be looking at disposable income. The data shows the Sunshine Coast has a higher disposable income than the Gold Coast and most of Brisbane. We could also destroy the ‘median’ price discussion, but let’s save that for another day. The data doesn’t accurately represent the state of the region unless you know how to evaluate it with context.
The reality is, the Sunshine Coast is extremely undervalued when you consider the region’s location, economy, and opportunities available….and Australians across the country are now noticing this. We have additional pressure on our market from people in areas such as Sydney and Melbourne who see how cheap our region really is.
The property market isn’t booming, we are at the beginning of the most protracted upswing cycle of our city’s history, or maybe any Australian city for that matter.
The question shouldn’t be how did we get here, it should now be how far will it go?
Here at Direct Collective, we foresee a time in our near future where it will be commonplace for homes to be over a million dollars in every suburb that’s on the beachside of the Bruce Highway, as well as Nambour (as it’s also a major growth centre). Our market isn’t going to slow down any time soon and the challenge that comes with this is continuing to cater to residents who work across a range of industries and on a range of salaries. There needs to be diversity in a community in order for it to thrive and we need to be managing this now to ensure an ideal future for all who call this place home.
What can we do?
Planning for this should have been in place ten years ago – now we are just trying to chase our tails. We need to have productive planning discussions with industry leaders and all levels of government about development on the Sunshine Coast. Our solution would be to construct medium and high-density living (close to amenity but not on the sand dunes!), to keep up with growth while also maintaining the beachfront lifestyle we all know and love. This would provide housing options for people who cannot afford the million-dollar price tags and prevent pushing out of certain socio-economic demographics or increasing the rate of first-time homelessness.
For more of our market insights, download your FREE copy of our research report The Sunshine Coast; The Future. https://investorproperty.com.au/insights/free-ebook/
To understand how this once-in-a-lifetime set of circumstances can positively impact your financial position through strategic property investment, connect with our property coaches for free and in-depth advice.