By Adam Empringham, Image Property
At the tail-end of 2020, the Sunshine Coast was the shining star of the Queensland property market.
Not only had the coast achieved property price growth for houses and units over the year, but the rental market was also firing at the same time.
Property prices firming
According to the latest data from the REIQ, Noosa remained number one of all major regions across the State over the September quarter with an impressive 3.6 per cent median house price quarterly increase to $895,000.
It was also the clear leader over the year with median house price growth of 11 per cent.
However, not to be outdone, the remainder of the Sunshine Coast also achieved a strong result over the year with a median house price increase of 5.3 per cent to record $611,000.
One of the most significant differences that has become apparent on the Sunshine Coast over the past year in particular is the continued strength of its unit market compared to many other locations around the State.
The median unit price in Noosa has increased by a staggering 67 per cent over the past five years, while it has also risen by 15.3 per cent in the Sunshine Coast council area.
Over the quarter and the year, the two regions also posted solid median unit price increases, with Noosa notching up price growth of 19.5 per cent over the year ending September.
With many of the region’s unit developments offering excellent positions near the coastline, as well as more affordable entry points, demand is expected to continue as well as strengthening prices.
Rental market rising
At the start of the pandemic, the rental market was expected to be the sector that bore the brunt of the lockdown.
However, again, the Sunshine Coast rental market has continued to go from strength to strength this year.
In fact, it’s been a very long time since the rental market was anything but undersupplied with vacancy rates being under the equilibrium point of three per cent for many years now.
By the end of last year, the rental vacancy rate had fallen to just 0.6 per cent on the Sunshine Coast, which is well into undersupply territory.
Part of the reason for the increased demand from tenants has been the coast’s growing population, including a big cohort of interstate migrants’ post-pandemic.
This uptick in demand is putting upward pressure on rents, which are increasing significantly during lease renewals as well as for new lease agreements.
With no new rental supply on the horizon, there are ample opportunities for investors to secure an income-producing asset on the coast, which also promises future capital growth as well.
While it’s clear that the Sunshine Coast has outperformed expectations last year, its strong market performance is not just a reaction to the pandemic.
Rather, myriad major infrastructure projects have been under way on the coast for a few years now, which were always going to have a positive impact on the property market.
When you couple these with historically low interest rates, as well as an influx of new residents seeking lifestyle and affordable property prices, it’s no surprise that many property experts and commentators are rightly bullish about the coast’s market prospects in 2021 and beyond.