PROPERTY BOOM: Coast prices set to skyrocket
THE Sunshine Coast property market is on the brink of a substantial lift with values predicted to rise 25-33% in the next two to three years.
Speaking at Mooloolaba, McGrath Estate Agents CEO John McGrath said that while Sydney and Melbourne markets are approaching the top of the market the Sunshine Coast was poised for significant gains.
This was like other areas in the south-east Queensland golden triangle of Brisbane, Toowoomba and the Gold Coast that were also at the start of the upturn on the property clock.
Mr McGrath was at Mooloolaba Surf Club for the launch of the latest McGrath Estate Agents office at Brisbane Rd, Mooloolaba.
He said there were two property markets in Australia - Sydney and Melbourne with about 50% increase in values post GFC - and the rest of the country.
For the past three or four years south-east Queensland has been in a recovery mode but is now seeing a sprouting of green shoots and is set to recapture some of that lost momentum.
Mr McGrath said while 12 o'clock was the top of the market and start of a downturn, 6 o'clock is the start of rising yields and under-supply of property.
He said if there was a correction in Sydney and Melbourne it would be a soft landing rather than falling off a cliff.
Sydney is like New York, he said, a big city with strong demand and pointed to the APRA regulations creating a tighter environment for lending as having a hand in protecting the market.
The intention was to use the higher deposit requirement as a handbrake and that what happened in Australia in the GFC was also a result of the conservative actions of the major banks.
After 33 years in the industry John McGrath still remembers his first sale, a residential property at the inner Sydney suburb of Paddington for $128,000. That was when he was aged 20.
He was involved in the popular television lifestyle series The Block for 12-13 years from its inception, having sold the initial Bondi property to Channel 9.
Rather than sensationalising the property market, at Mooloolaba he was considered in his commentary and put into perspective a complex issue.
He said the market was very much a matter of being in the moment.
You can talk about what has been and what is likely to happen but the best indicator of the market for John McGrath is what happens on the auction block.
"Real estate is so much a part of our lives," he said.
"It is the second career for most people in Australia.
"Your own home, perhaps a property portfolio ... that's where most people get ahead.
"I love being in an industry that makes a difference, financial as well as on a personal basis."
He said the Sunshine Coast, Gold Coast and Toowoomba were lifestyle regional markets - home to some of the best lifestyles in the world and set for significant recovery in the next three four years.
"There is an old saying that it's always darkest before dawn," he said.
"This is a time for investing, those that did have benefited.
"This is not a calculated risk.
"The demand is here, property cannot be manufactured overnight.
"It takes two to three years to bring on line.
"Right now, if New South Wales was to cease population growth it would take three years to build enough for housing for the demand."
Baby boomers wanting to downsize or looking for a seachange and treechange would be part of the new wave of buyers.
Yet the price gap between Sydney median and Brisbane of about $400,000 was also an attractor of buyers to south-east Queensland.
"It should not be as great as it is. It will narrow," Mr McGrath said.
THE FOUR FACTORS
THE four important factors when selling a property are people, pricing, presentation and marketing, according to John McGrath.
"The first thing I learned was real estate has little to do with property but everything to do with people," he said.
"The role of an agent is a critical one.
"Presentation can cost a bit but the best home in world will not sell if it is not priced right.
"You can only make a first impression once.
"When people first walk in, it's no matter how good the agent is, the property must sing to the buyer so they can see themselves moving into it in 30 days."
And marketing looks at four groups of buyers. Local, out of area, active or passive.
Locals either live here or want to invest while out of area buyers are such as Sydney.
Active buyers can be both in an out of the area and local while passive buyers may not realise they are in the market but get motivated once they see something that takes their fancy.
"If you do it right, this business is a science," Mr McGrath said. "Do it wrong and you are simply winging it."