This article is from the Australian Property Journal archive
THE average price for a new Gold Coast apartment has topped $1.6 million for the first time, as owner occupiers swamped the market and snapped up the scarce supply amid projects struggling to get out of the ground.
Colliers’ latest Gold Coast Residential Market Report data shows that at just 236, the number of new apartment sales in the three months to the end of December was the second-lowest of any quarter in the past three years.
The figure was slightly higher than the 211 sales in the June quarter and just over half the 470 sales recorded in the September quarter, also tallied by Urbis.
Total sales of 1,205 new apartments for 2023 were down 13% on the 1,389 sales recorded in 2022, and less than half the 2,492 apartments sold in 2021 at the peak of the national construction boom.
David Higgins, the Gold Coast director residential at Colliers, said the latest sales numbers reflect the ongoing challenges of meeting demand for new apartments on the Gold Coast.
“We are really seeing residential projects struggling now out of the ground, due to the massive increase in construction costs, making many projects just not feasible in the current cycle,” he said.
“Sales volumes are lower while average prices have spiked higher as supply and variety of stock remains constrained. It’s causing a massive fluctuation of pricing in the market.”
The average sale price came in at 14.5% higher than the previous record of $1.44 million in the September quarter of 2022, and a whopping 45% up quarter-on-quarter from the $1.134 million average at the end of September last year.
The pricing is also reflected in a resurgence of owner occupiers, who accounted for 55% of the sales over the quarter.
Prime central suburbs most popular
Broadbeach and Surfers Paradise dominated the market in both sales and supply over the 2023 calendar year, with the Gold Coast’s prime central suburbs accounting for about 70% of total sales.
The Gold Coast central precinct, which includes Southport and Labrador and stretches south to Burleigh Heads, remained the hotspot for development activity during the quarter with 20 of the 30 apartment projects available for sale located there. Only 1,489 apartments in total remaining for sale from these projects, out of a total of 4,471 that have been put to the market.
Colliers is forecasting about 2,850 apartments will be completed on the Gold Coast.
Higgins said the bulk of these apartments have already been presold over the past few years, “so this will not help deliver additional supply”.
Plans to bulk-up tower in $2bn precinct
In the central precinct, George Mastrocostas’ Aniko Group is refining the masterplan for its flagship $2 billion mixed-use development, The Landmark at Mermaid Beach, looking to incorporate rightsizing aspects and capitalise on demand.
Following Council approvals secured late last year, Aniko has submitted a modified development application to the City of Gold Coast that sees Tower 1 bulked up with floor plates expanded from 784 sqm to 837 sqm and five new floors added, taking the tower from 30 levels to 35, and the number of apartments up from 170 to 240.
“The refinements allow us to introduce coastal apartment living at a price point that our buyers are seeking, one that simply doesn’t exist in the current market,” Mastrocostas said.
He said the changes would allow the group to bring to the market a “more diverse range of apartments, strategically catering to rightsizers”.
The vast majority of the first tower’s two-bedroom apartments would now include a study nook, and its range of three-bedroom apartments expanded.
“While we also plan to introduce a collection of stylish, three-bedroom-plus residences, we also want to cater to a segment of the market that has been overlooked by developers in the Gold Coast’s prime beachside suburbs in recent years,” Mastrocostas said.
Approval of the modified submission would take the total number of apartments to 891.
Situated on a 1.1342-hectare site at the corner of the Gold Coast Highway and Seaview Avenue, The Landmark will feature apartments, offices, medical services, a luxury hotel, and a ground-floor retail and dining precinct.
Current approval is for three residential towers of 25, 30, and 40 storeys, along with a 53-level tower featuring a mix of hotel suites and private hotel-branded residences, to be delivered over the next six years.
Rents on the up
In the rental market, low vacancy rates across the Gold Coast have helped drive median weekly apartment rental rates by 10% over the year from $682 to $750 a week.
“Increasing rental yields reflect the substantial growth of the investment market across the Gold Coast new apartment market,” Higgins said.
“The apartment market continues to be supported by local and interstate investors who are taking advantage of the strong yields.”
