Gold Coast apartment supply reaches 10 year low: Colliers
Gold Coast apartment supply has reached its lowest level in a decade with no new stock added to the market in the June quarter while sales were steady, according to Colliers International.
It found sales volumes have continued to be strong and the supply of new apartments has dropped to around 930 apartments.
The best performing region in the area was the North Shore Precinct, with a total of 58 sales across eight projects, including 32 sales in Etesian at Harbour Quays.
The sales rate in the Southport/Labrador precinct lifted 44% to an 18 month high, with 23 unconditional sales across six projects.
In Surfers Paradise, the sales rate lifted for the third consecutive quarter to record 46 sales across four projects with 22 sales in Soul, 13 in the Hilton Orchid Tower and 10 sales in the Hilton Boulevard Tower.
New apartment sales on the Gold and Tweed Coasts fell slightly over the June quarter after rising for the previous five consecutive quarters. But overall volumes were significantly stronger over the first half of the year compared to the same period last year.
There were 166 sales during the June quarter, putting it ahead of the same period last year by 120 sales or 49%. Colliers says the market is on track to have a significantly stronger year than 2012.
The residential market on the Gold Coast has now turned around and is on the way back up, according to Tony Holland, Colliers International Residential Director.
“The first signal that the market was improving was a rise in volumes, which was first evident in the March quarter of last year,” he said.
“Sales volumes have continued to increase over the course of 2012 and over the first quarter of this year, and while this quarter has seen a slight fall, this is due to the lack of availability of stock rather than a lack of interest from buyers.”
There were are two or three new apartment projects that likely to be launched off the plan in the next six months with more due to follow after mid-2014.
But he says based on the current sales rate, the remaining new apartment stock could be absorbed within 17 months leading to a serious undersupply, particularly in the low rise sector, until the new projects are launched.
“Buyers are identifying that the fundamentals of the Gold Coast market are strong, and this increasing buyer demand, coupled with an undersupply, will lead to growth in prices over time,” Holland says.
“Over the past year projects that had a significant overhang of stock, such as Oracle, Hilton and Soul have sold a significant number of apartments and people are buying into those buildings with confidence.
“They know the future looks good for the Gold Coast, with around 10,000 people moving to the region every year and significant projects such as the 2018 Commonwealth Games set to give the area a huge boost.”
It found seven apartment projects across the Gold and Tweed Coasts sold out during the June quarter.
There are now just 28 projects remaining in Colliers’ survey going into the second half of 2013, the lowest number of projects recorded by the group since 2001.