SIGNS OF RECOVERY DESPITE GRIM PRODAP REPORT

Written on the 8 July 2013

THE Gold Coast’s development industry continues to struggle as sales of vacant housing lots and new house-and-land packages track well below -20 year averages, says the Prodap Report.

The report’s author, Bill Morris, says combined sales of new housing and vacant land have been running at under 1000 a year, which compares with the long-term average of 4200 a year since 1995.

The dour sales figures are reflected in a 4.5 per cent fall in Gold Coast house prices and a 7.3 per cent fall in unit prices over calendar 2012.

Morris says the Coast’s housing development sector has not seen such a “grim picture” since the 1981-82 recession.

“The sad news is that not even record low interest rates seem to have had any effect on the volume of sales; sad but true,” says Morris.

He says the city council’s Construction Kickstart initiative, which has cut infrastructure charges on a broad range of developments, appears to have had no effect on new production.

However, Master Builders’ regional manager John Duncalfe tells Gold Coast Business News he is seeing early signs of improvement in the city’s construction sector.

Duncalf says the Construction Kickstart may only now be delivering some stimulus to the sector, although he says a clearer picture may emerge when the first round of the program is completed in March.

Morris says the Coast’s construction slump has been driven by rising costs, with established houses now much cheaper, and in many cases better located, than new houses.

“Land prices are still too high, representing more than 50 per cent of the price of the average home,” says Morris.

“This was not case 10 years ago, when the average serviced block cost $60,000. In 10 years that has risen to $220,000, almost 300 per cent, or 30 per cent per annum.”

Morris says land prices have escalated “out of all proportion” to house prices over the past 10 years.

“There needs to be a new era of thinking about what level of services constitutes an ‘acceptable’ house lot.”

The Prodap Report is published quarterly and contains a database of developer sales and stock levels on the Gold Coast.


Latest News

HOW INGRID BONNOR TURNED A LABOUR OF LOVE INTO A WORLDWIDE FASHION ICON

BEFORE Ingrid Bonnor started her bridal robe and feminine sleepwear company Homebodii in 2011, she didn't have an...

G8 EDUCATION EXECUTIVE CHRIS SCOTT RETIRES AS COMPANY CUTS CHINESE TIES

LONG-TIME managing director and executive of G8 Education (ASX: GEM) Chris Scott has announced his retirement, on ...

REGIONAL BANKS HIT OUT AT RATING CUT AND WARN BIG FOUR WILL BENEFIT

REGIONAL banks have hit out at a downgrade on their credit ratings, warning that it will increase their wholesale fun...

$71 MILLION SALE OF 'SYDNEY SIX' GIVES RISE TO WESTERN SYDNEY INVESTMENT HOTSPOT

SIX INDUSTRIAL assets in Sydney's West, dubbed the 'Sydney Six', have sold for a collective $71 million, ...

Related News

REGIONAL BANKS HIT OUT AT RATING CUT AND WARN BIG FOUR WILL BENEFIT

REGIONAL banks have hit out at a downgrade on their credit ratings, warning that it will increase their wholesale fun...

THE COMPANY THAT DECIDED IT WAS GOING TO GIVE A CRAP THANKS TO CROWD FUNDING

SIMON Griffiths is using toilet paper to save the world.

In 2012, on the back of an IndieGoGo crowdfunding campaig...

SURFSTITCH DOWNGRADES EARNINGS AS SHARES PLUNGE 25 PER CENT IN A DAY

TROUBLED online sports clothing retailer SurfStitch is considering selling off more of its assets and will close i...

AUSCANN RESUMES TRADE AFTER $12 MILLION CAPITAL RAISING

IT'S BEEN a big few days for medical cannabis manufacturer AusCann (ASX: AC8), as the company emerged from a trad...

BOOK YOUR FUNCTION SPACE HERE

 

 

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter