Gladstone house price growth stalls in June quarter, but double-digit growth in some suburbs: REIQ

House prices in the Gladstone region, arguably Australia’s most well-known mining-related investment hotspot, remained unchanged over the June quarter, according to the latest figures from the Real Estate Institute of Queensland.

According to the REIQ this was the second consecutive quarter that median house price growth remained stagnant in Gladstone.

Located around 550 kilometres north of Brisbane, Gladstone had a median sales price over the three months from April to June of $475,000.

In terms of annualised 12-month sales data, Gladstone remains the top-performing local government area (LGA) in Queensland, with house prices up 14.6% from $410,000 to $470,000 from June 2011 to June 2012.

In comparison, Brisbane house prices have fallen 4.7% to a median of $505,000 over the same period.

However, a closer look reveals a very mixed performance across Gladstone’s suburbs – as reported by Property Observer earlier this month.

The strongest performer over the quarter was South Gladstone, with house prices up 20.5% over the quarter to a median of $530,000.

There was also a strong quarterly price gain of 10.2% in Calliope, taking the median house price to $452,000.

However, house prices fell in Clinton (- 3.5%) and West Gladstone (-1.3%) over the quarter.

Many Gladstone suburbs do not have quarterly data due to too few sales, but the annual picture is of solid capital growth over the past 12 months in most suburbs.

Over the year to June New Auckland has been the strongest performer with house prices up 20.4% to $510,000.

Locality	Median Sale Jun12	Qtrly change	1yr change
GLADSTONE
GLADSTONE (LGA)	$     475,000	0.0%	14.6%
GLADSTONE (LGA) ^ ~	$     475,000	-2.1%	-6.3%
AGNES WATER ^	N/A	N/A	2.8%
BARNEY POINT	N/A	N/A	17.8%
BENARABY^	N/A	N/A	9.6%
BOYNE ISLAND	$     492,500	-0.2%	9.4%
CALLIOPE *	$     452,000	10.2%	13.3%
CALLIOPE ^	N/A	N/A	8.9%
CLINTON ~	$     468,000	-3.5%	18.5%
GLEN EDEN	N/A	N/A	1.3%
KIN KORA	$     493,500	5.6%	18.3%
NEW AUCKLAND *	$     510,000	4.1%	20.4%
SOUTH GLADSTONE ~	$     530,000	20.5%	18.0%
SUN VALLEY	N/A	N/A	16.8%
TANNUM SANDS	$     507,000	3.6%	12.8%
TELINA	$     525,000	0.6%	14.3%
WEST GLADSTONE	$     418,500	-1.3%	15.3%
SURROUNDS
BANANA (LGA) ~	$     256,000	-2.9%	-3.6%
BILOELA ~	$     305,000	10.9%	2.9%
MOURA	$     250,000	-4.8%	-13.2%

Source: REIQ

Australia's cane sugar capital, Mackay – about 400 kilometres further up the coast from Gladstone – was the only other Queensland locality to record house price growth for the year to June, with values up 2.9% from $408,000 to $420,000.

Townsville was the strongest regional performer over the quarter, with a 4.2% rise to $375,000 – prices are down 2.7% for the year.

Closer to Brisbane, Toowoomba posted its second quarter of positive results, with its median house price increasing 3.8% to $299,000.

Locality	Median Sale Jun12	Qtrly change	1yr change
BRISBANE CITY (LGA)	$     500,000	-1.0%	-4.7%
BRISBANE (SD)	$     433,000	1.9%	-3.8%
IPSWICH CITY (LGA)	$     290,000	-3.3%	-3.8%
LOGAN CITY (LGA)	$     330,000	-1.5%	-5.6%
MORETON BAY (LGA)	$     379,000	5.3%	-5.1%
REDLAND CITY (LGA)	$     438,250	4.3%	-4.9%
GOLD COAST CITY (LGA) +	$     467,000	2.8%	-3.7%
TOOWOOMBA (LGA)	$     299,000	3.8%	-3.4%
SUNSHINE COAST (LGA) +	$     434,000	0.9%	-5.5%
FRASER COAST (LGA)	$     282,000	-2.8%	-3.7%
BUNDABERG (LGA)	$     287,500	2.7%	-2.1%
GLADSTONE (LGA)	$     475,000	0.0%	14.6%
ROCKHAMPTON (LGA)	$     315,000	-1.6%	-0.6%
MACKAY (LGA)	$     425,000	0.0%	2.9%
TOWNSVILLE CITY (LGA)	$     375,000	4.2%	-2.7%
CAIRNS (LGA) ~	$     346,500	-1.0%	-4.1%

Source: REIQ

REIQ Gladstone zone chairman Mark Spearing says activity had decreased over the quarter but still remains at very healthy levels.

“While the market was slightly quieter over the June quarter, it was still in very good health compared to many other parts of the country,” he says.

Spearing says there remains a mix of buyers interested in purchasing in the Gladstone region, with many forecasting stronger times ahead.

“There isn’t a dominant buyer as such as first-home buyers – investors and upgraders are all currently active,” he says.

“Our region still has a number of projects to come online. Low interest rates and the return of the principal place of residence stamp duty concession are also underpinning our market, with many people believing we are still fairly early on in this current property cycle.”

Property market analysts Michael Matusik and Terry Ryder both believe the best time to invest in Gladstone has now passed.

Michael Matusik recently told Smart Property Investment magazine that the major acceleration of growth in the Queensland mining super-hotspot Gladstone was over.

Matusik puts Gladstone at between nine and 12 on the property investment clock, meaning growth is slowing and values could stagnate.

Hotspotting.com.au founder Terry Ryder says the savviest of investors were already in the market 12 to 18 months ago and are now selling up leading to high sales volumes.

Gladstone ranked third in Your Investment Property magazine’s 2012 list of Top 100 suburbs and was ranked second last year. The town is home to the world’s biggest alumina refinery, Australia’s biggest aluminium smelter and the country’s largest cement operation.

There are currently $69 billion worth of projects currently in the early stages of construction, and projects worth a further $26 billion are expected to commence in the next few years.

In Property Observer’s recent analysis of hotspots touted in 2011, we found Gladstone was one of the only celebrated areas to have lived up to expectations.

However, the most recent report on Gladstone from PRDnationwide notes there are a number of headwinds facing investors in the area.

For more, download our free eBook Property Investing in Queensland's Property Boom.

Median Price: The middle sale price when arranged in ascending order, ie where half of the sales recorded were less and half were higher than the median

All figures are preliminary and are subject to further revision. Only suburbs to record sufficient sales numbers have been included. N/A No preliminary estimate available due to insufficient sales numbers

^ Denotes acreage sales - on land size greater than 2,400m2. All other house and land sale statistics are based on land size under 2,400m2 (LGA)

Local Government Area Brisbane (SD)– Brisbane Statistical Division which includes the LGA's of Brisbane City, Ipswich City, Logan City, Moreton Bay Regional and Redland City. ~ Medians affected by varying quality of stock sold

* Medians affected by varying quantities of new properties sold

f Medians affected by varying numbers of waterfront properties sold

M Sales volumes and medians affected by mining company sales

+ Due to the nature of properties in this suburb, some group titled property sales have been included "SOURCE: REIQ, Data obtained from PriceFinder (www.pricefinder.com.au). Enquiries about the reproduction of part or all of the information should be directed to the Marketplace Strategy Division, REIQ.

 Based on or contains data provided by the State of Queensland (Department of Environment and Resource Management) 2012. In consideration of the state permitting use of this data you acknowledge and agree that the state gives no warranty in relation to the data (including accuracy, reliability, completeness, currency or suitability) and accepts no liability (including without limitation, liability in negligence) for any loss, damage or costs (including consequential damage) relating to any use of the data. Data must not be used for direct marketing or be used in breach of the privacy laws.