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  • 1. second HALF 2012 | SOUTH EAST QUEENSLAND COMMUNITIESResearch & Forecast Reportsouth east queenslandcommunities Sales Lift Across Most Areas Market sentiment was mixed over the first half of 2012 (H1 2012), with little consistency in performance amongst residential communities in the Brisbane, Ipswich, Logan Moreton Bay and Gold Coast Local Government Areas (LGA’s). Whilst some projects achieved sales of up to 32 vacant lots per month, other developers reported stage deferrals and subdued sales figures. The majority of projects surveyed experienced an increase in sales over the previous half, however, developers and marketing agents reported an increase in the time taken to convert enquiries into sales, as purchasers, particularly investors, become more sophisticated with greater access to market information. The weighted average median sale price is used for each region throughout this report and aims to provide an indication of price movement over the period. Over H1 2012 the median declined 1.5% to $215,239. The slight decline in price could be partly attributed to increased demand for smaller lots which developers are creating to reduce land creation costs and increase affordability in their estates. For the purpose of ascertaining the current demand and availability of vacant land, and house andYarrabilba, Precinct One land packages, this report utilises a survey of residential communities yielding 100 lots or more. TheLend Lease has begun delivery of the initial stages identified LGA’s are referred to throughout the report as South East Queensland (SEQ). They include;at its Yarrabilba project, which upon completion is Brisbane, Ipswich Logan, Moreton Bay and the Gold Coast (including the Northern Tweed Area).expected to be one of the largest master plannedcommunities in Australia. Private sector house approvals in SEQ increased for the second consecutive quarter over Q2 2012 taking the total for H1 2012 to 3,989, a 16% increase on the previous half. According to populationRECENT PERFORMANCE OF THE statistics, the number of houses being approved is well below requirements for population growth.RESIDENTIAL COMMUNITIES MARKET: Figures from the 2011 census show the study areas population increased by approximately BRISBANE 33,000 persons per year since 2006, equating to a requirement for over 14,000 new dwellings. IPSWICH The housing industry has called for the government to do more to increase affordability in SEQ. Measures LOGAN such as removing stamp duty from off-the-plan new home sales, subsidising the federally funded first home buyers grant and lifting the land tax surcharge may encourage investment in housing. Reports MORETON BAY from industry professionals show the $10,000 Queensland Building Boost failed to have the desired effect. The eligibility period ended 30 April 2012 after the initial budget of $140 million was not allocated GOLD COAST by the original 30 January expiry. According to developers, the cost of delivering residential lots is being inflated by convoluted planning processes and charges on development. These costs are being passedKey Highlights directly onto the purchaser.• ransaction volume increased with 1,640 T vacant land sales in H1 2012. RESIDENTIAL LAND MARKET INDICATORS - FIRST HALF 2012• he weighted average median sale price T Weighted Average Region Sold to Date Remaining Yield Number of Projects Sale Price declined to $215,239 Brisbane $251,912 1,964 2,499 10• tate Government initiates significant S changes to planning policy. Ipswich $191,456 7,968 10,593 18 Logan $173,543 3,009 3,469 10 Moreton Bay $217,714 10,812 8,178 22 Gold Coast $244,573 9,086 6,691 20 Source: Colliers International
  • 2. research forecast report | second HALF 2012 | residential I seq Moreton Bay has the highest concentration of marketed projects and as a result, the area achieved the highest number of sales in H1 2012, at 27% of the total lots sold. Over the 12 months to H1 there were approximately 2,995 vacant land sales across the identified estates. Again, Moreton Bay accounted for the majority on an annual basis at 29%. Vacant land sales in SEQ Vacant Land Sales in SEQ 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% H1 2012 Year to H1 2012 Brisbane Ipswich Logan Moreton Bay Gold Coast Source: Colliers International Research HOUSING FINANCE Data from the ABS revealed Queensland housing finance commitments improved in the first half of 2012. Growth of 2% saw 51,903 loans in H1 2012 with first home buyer activity rising to 10,286, a 10% increase on the previous period. Commitments remained weighted towards the purchase of existing dwellings (84%) followed by the construction of new dwellings (12%) and the purchase of a new house (4%). Interestingly, the proportion of finance commitments for the purpose of constructing or purchasing a new dwelling are both above their 10 year averages, it is only the proportion of commitments for the purchase of existing dwellings that has fallen below its 10 year average. Although the new housing industry would welcome this trend, the number of finance commitments across the sector has been on a path of negative growth since the most recent peak in H1 2007. Lot Approvals According to the latest release from the Office of Economic and Statistical Research (OESR), the number of vacant lots approved for residential development declined 12% to 9,664 over the year to March 2012. The weaker result was in part due to subdued approval activity between January and March. Over the same period, dwelling approvals in SEQ fell 17% to 7,526 in the 12 months ending in March 2012. SEQ Residential lots approved for development SEQ Residential Lots Approved For Development 12 Months to March 25,000 20,000 15,000 10,000 5,000 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 Brisbane Ipswich Logan Moreton Bay Gold Coast Source: OESR / Colliers International Research Colliers International | p. 2
  • 3. research forecast report | second HALF 2012 | residential I seq SOUTH EAST QUEENSLAND INFRASTRUCTURE UPDATE Estimated Infrastructure Project LGA Location Status Current Description Completion Date RAIL A $1.8 billion project which will deliver a light rail service from Griffith Southport to New Light Rail Gold Coast U/C Stage One - 2014 University through Southport, Main Beach, Sufers Paradise and Broadbeach terminating in Broadbeach. The project includes two train stations – one near Woodcrest College and one near the Orion Shopping Centre, a 9.5km dual track rail line Richlands to Rail Extension Ipswich U/C Late 2013 from Richlands to Springfield, an auxiliary city-bound lane on the Springfield Centenary Highway and two crossings under the Centenary Highway from Springfield Station to the Orion Shopping Centre. A $1.2 billion extension to the existing line. Upon completion the Varsity Lakes to Rail Extension Gold Coast Planning Unknown rail link will connect Varsity Lakes with the Gold Coast Airport in Coolangatta Coolangatta. A 12.6km dual-track passenger line running between Petrie and Petrie to Kippa- New Rail Line Moreton Bay Concept Design 2016 Kippa-Ring, including six new stations at a cost of $1.15 Billion jointly Ring funded by Federal, State and Local Government. ROAD A $3.8 billon upgrade to six lanes to the M1 Motorway from Nerang to M1 Upgrade Gold Coast Nerang to Tugun U/C 2014+ Tugun, interchange upgrades currently underway. A $359 million upgrade of 2.5km of the Pacific Highway from Pacific Hwy Upgrade Gold Coast Banora Point U/C Late 2012 Barneys Point Bridge through Banora Point to the Tweed Heads Bypass. Toowong to Kelvin A 4.6km twin two-lane tunnels running from Toowong to Kelvin Grove Legacy Way Brisbane U/C Late 2014 Grove which will be owned and operated by the BCC. Part of the TrasApex system of bypasses - primarily tunnels Northern Link Brisbane North Brisbane U/C 2012-15 combining to form an inner city ring road. The project total cost is estimated at $1.7 billion. Ipswich Motorway $824 million upgrade to the Ipswich Motorway between Wacol and Ipswich Wacol to Darra U/C 2014-15 Upgrade Darra from four to six lanes with the provision for eight in the future. Upgrade works to the Logan Motorway at an estimated cost of $4.3 Logan Motorway Upgrade Logan Planning 2016+ billion. OTHER A $500 million upgrade and extension as part of the Southern Cross University Gold Coast Coolangatta U/C 2021 University Master Plan. Buildings B C underway. Griffith University Health Centre will consist of a 650 seat lecture University Gold Coast Southport U/C 2013 theatre, research facility and biomedical research laboratories - $150 million. The Gold Coast University Hospital is expected to supply Hospital Gold Coast Southport U/C Q4 2013 approximately 750 beds over seven new buildings at a cost of $1.76 billion. $130 million expansion to the Ipswich Hospital including a two Hospital level extension of the existing Clinical Services Building (CSB), the Ipswich Ipwsich Planning 2013 Emergency Department and refurbishing works to the Out Patients Building. A $1.8 Billion gas-fired power station located close to Ipswich, near Power Station Ipswich Swanbank Planning 2016+ the Swanbank B coal-fired power station which is due to be replaced in April 2012. A $1 billion, 93ha industrial and business park on the site of the Industrial/Business Park Ipswich Wacol Planning 2012-26 former Sanananda Army Barracks.Source: Colliers International Research / Dept. Transport and Main Roads / SEQ Infrastructure Plan Colliers International | p. 3
  • 4. research forecast report | second HALF 2012 | residential I seq Brisbane Activity in the Brisbane LGA was relatively flat in H1 2012 with little movement in transaction volumes or median sale price. Across 10 surveyed projects there were a total of 193 vacant land sales and an additional 76 house and land packages sold. The focus of sales activity was in the southern corridor of the Brisbane LGA extending towards Logan, where larger englobo parcels of land are being made available for development. There were approximately 239 new lots released to the market bringing the total available for sale to 296, less than 10% of the total available in SEQ.The Rochedale Estates The median sale price of projects surveyed declined 4% to $251,912 in the first half of 2012. ThisWith the delivery of 1,000 lots, The Rochedale drop could be partly attributed to developers reducing lot prices in order to increase affordability,Estates accounts for 34% of future supply in as a reflection of this, the median lot size fell to 530m2. The proportion of projects with a medianBrisbane’s currently marketed projects. lot size of less than 550m2 remained unchanged at 42%. The limited availability of large englobo land parcels in the Brisbane LGA has led to a constrainedKey Highlights future supply pipeline compared to surrounding areas. The southern corridor will be a focus of development activity with 56% of the future lots located to the south of Brisbane. Rochdale in• he weighted average sale price across the T particular has a high concentration of the estimated future supply with the expected delivery of surveyed projects fell to $251,912. over 1,200 low and medium density lots across two projects.• here were 193 vacant land and 76 house T and land package sales over H1 2012.• risbane LGA accounted for 12% of all new B vacant land sales in SEQ within estates comprising over 100 lots. Brisbane lga market activity residential estates* Estate Name Suburb Year Commenced Total Lots Sold to Date Remaining Yield (%) Sold Hilltop Carindale Carindale 2011 157 24 133 15% Forest Park on Brookside Doolandella 2008 247 143 104 58% The Village at Durack Durack 2010 170 116 54 68% Fitzgibbon Chase Fitzgibbon 2009 914 320 594 35% The Sanctuary on Moggill Moggill 2007 355 254 101 72% Circa1 Nudgee 2011 145 54 91 37% Arise at Rochedale^ Rochedale 2011 475 85 390 18% The Rochedale Estates Rochedale 2010 1,000 138 862 14% The Parks Stretton 2001 500 396 104 79% Mossvale on Manly Wakerley 2002 500 434 66 87%*Identified estates with successful survey responses comprising 100+ lots in total1 Includes House and Land Packages^ Information not providedSource: Colliers International Research Colliers International | p. 4
  • 5. research forecast report | second HALF 2012 | residential I seq Ipswich For the second consecutive half, transaction volumes increased across surveyed projects with 100 lots or more. Over H1 2012 there were approximately 377 vacant land sales in 19 residential communities with the suburbs of Augustine Heights (134), Springfield/Brookwater (106) and Redbank Plains (38) accounting for the majority of sales. Projects closer to central Ipswich reported subdued levels of demand over the half. On an annual basis, the Ipswich LGA made up a quarter of all vacant land sales in SEQ, equal to annualised volumes on the Gold Coast and slightly less than Moreton Bay. There appeared to be some positive price movement in Ipswich over H1 2012 with the weightedSpringfield Lakes average median sale price increasing 5% in six months to $191,456. As a reflection of higher demandOne of the older master planned communities in for smaller more affordable lots in the second half of 2011, the annualised median sale price declinedSEQ, Springfield reached 50% completion at the by 2%. According to the completed surveys, Ipswich was the most affordable region in SEQ withend of June 2012. vacant land available at an average of $360/m2. The median lot size across projects that recorded any sales over the half was 532m2, 47% of those surveyed had a median size under 550m2.Key Highlights The future supply of lots in existing and mooted projects is currently estimated at just over 15,000.• he weighted average sale price rose 5% T Future development activity is set to follow current trends with the majority of lots in the Ipswich over H1 2012 to $191,456. supply pipeline located in the Springfield-Ripley Valley corridor. This estimate excludes the potential• emand increased for small lots with 47% D supply of 50,000 mixed density dwellings in the ULDA’s Ripley Valley urban development area. of projects reporting a median lot size less than 550m2.• ugustine Heights achieved one of the A highest sales rates at 23 vacant land sales per month. ipswich lga market activity residential estates* Estate Name Suburb Year Commenced Total Lots Sold to Date Remaining Yield (%) Sold Brentwood Rise Augustine Heights 2007 1,517 470 1,047 31% Augustine Heights Augustine Heights 2003 816 600 216 74% The Springs Augustine Heights 2009 276 105 171 38% Parkway Green Augustine Heights 2010 150 72 78 48% Savannah Woods Brassall 2007 750 208 542 28% Brookwater Golf Estate^ Brookwater n/a 850 n/a 850 0% Fairways Brookwater Brookwater 2006 186 23 163 12% Sovereign Pocket Deebing Heights 2010 752 80 672 11% Cunningham Rise Goodna 2009 211 100 111 47% Stanton Park Karalee 2007 160 155 5 97% Park Village Karalee 2012 150 0 150 0% Heritage Links Leichhardt 2010 241 69 172 29% Essington Rise Leichhardt 2010 160 36 124 23% Riverwood North Booval 2008 154 142 12 92% Parklands at Raceview Raceview 2009 210 170 40 81% Mount View^ Redbank Plains 2009 1,258 440 818 35% Fernbrooke Ridge Redbank Plains 2010 1,120 502 618 45% Springfield Lakes Springfield Lakes 1999 9,600 4,796 4,804 50%*Identified estates with successful survey responses comprising 100+ lots in total^ Information not providedSource: Colliers International Research Colliers International | p. 5
  • 6. research forecast report | second HALF 2012 | residential I seq Logan Transaction volumes in the Logan LGA experienced significant growth with the first release of Lend Lease’s Yarrabilba Precinct One, comprising approximately 500 lots. During H1 2012 there were 192 new vacant land sales over eight estates. Although Logan has large tracts of englobo land, activity in the region remains somewhat subdued as a result of weakening purchaser sentiment over the last year. Over the previous 12 months, Logan accounted for the lowest volume of new land sales in SEQ at 10% of the total sold. Demand for small lots increased over the half resulting in a 13% decline in the weightedStoneleigh Reserve average median sale price, falling to $173,543. The average rate per square metre over H1 2012Lend Lease increased their marked presence in was $402/m2.Logan with the release of Stoneleigh Reserve in H12012. To the west of Logan Central, the suburbs of New Beith and Undullah are expected to see increased levels of supply. Lend Lease and Peet hold the most significant parcels of land in the Yarrabilba andKey Highlights Flagstone future urban development area’s and are expected to deliver approximately 26,000 lots over the respective project lives. Lend Lease has achieved development approval for the first eight• he release of new projects saw transaction T stages consisting of approximately 500 lots at Yarrabilba. volumes increase 80% from the previous period.• ogan recorded the lowest weighted average L median sale price at $173,543.• significant amount of future supply A remains in the pipeline with over 35,000 lots to be delivered in the next 25 years. logan lga market activity residential estates* Estate Name Suburb Year Commenced Total Lots Sold to Date Remaining Yield (%) Sold Windaroo Outlook^ Bahrs Scrub 2008 250 209 41 84% Teviot Downs Greenbank 1995 2,100 984 1,116 47% Alberi Park^ Holmview 2008 225 203 22 90% Vale at Holmview Holmview 2011 580 80 500 14% Riverbend Jimboomba 2006 130 48 82 37% Flagstone Estate Jimboomba 2008 426 310 116 73% Jimboomba Woods Jimboomba 2008 498 59 439 12% Stoneleigh Reserve Logan Reserve 2012 479 17 462 4% Woodlands Waterford 2005 1,290 1,013 277 79% Yarrabilba Precinct One Yarrabilba 2012 500 86 414 17%*Identified estates with successful survey responses comprising 100+ lots in total ^ Information not provided Source: Colliers International Research / RP Data Colliers International | p. 6
  • 7. research forecast report | second HALF 2012 | residential I seq Moreton Bay Moreton Bay was again the most active LGA in SEQ with 461 vacant land sales in H1 2012 according to completed surveys from 17 residential communities. Colliers has identified an additional seven communities yielding over 100 vacant lots, however complete information was unavailable. Transaction volumes would be expected to increase with the inclusion of results from some of the regions larger, more active developers. Over the 12 months to H1 2012 Moreton Bay accounted for 29% of all vacant land sales in SEQ, a trend that is set to continue in the short term. The trend towards small lots in SEQ is most prevalent in Moreton Bay with 85% of projects surveyedNorth Lakes reporting a median lot size of less than 550m2. Interestingly, about half of these recorded a medianThe Stockland estate maintained momentum with lot size less than 450m2. This is the result of escalating costs in land production which developers are41% of Moreton Bay’s vacant land sales in H1 2012. responding to by reducing lot sizes. An increase in transaction volumes in combination with declining median lot sizes had little effect on price movement. The median sale price declined only slightly (2%)Key Highlights to $214,714, reflecting a rate per square metre of $477/m2.• oreton Bay achieved the highest number of M At the end of H1 2012 there were an estimated 9,000 lots still to be developed in 24 existing projects sales in SEQ during H1 2012 accounting for with an additional 4,600 in various stages of future planning. The majority of future activity is located 29% of the total. in the Anzac Avenue corridor to the east of the Bruce Highway where some of the largest residential• edian prices remained relatively stable at M communities such as North Lakes and Capestone are currently being developed. The corridor to the $214,714, reflecting a rate per square metre west of the Bruce Highway from Kallangur to Caboolture will also be a focus of future development of $478/m2. with close to 4,000 lots in the pipeline.• he eastern Anzac Avenue corridor T is expected to be the focus of new development in the near term. moreton bay lga market activity residential estates* Estate Name Suburb Year Commenced Total Lots Sold to Date Remaining Yield (%) Sold Trinity Waters Beachmere 2009 131 55 76 42% Woodvale^ Burpengary 2011 244 n/a n/a n/a Riverparks Caboolture 2003 450 256 194 57% Central Lakes Caboolture 2004 1,087 762 325 70% Elysian Grove Caboolture 2008 258 244 14 95% The Reserve Caboolture 2012 195 18 177 9% Riverbank Caboolture South 2012 1,300 17 1,283 1% Alma Heights Dakabin 1996 660 522 138 79% Essencia Dakabin 2010 274 145 129 53% Springbrook Estate Delaneys Creek 2007 228 45 183 20% Pine River Estate^ Griffin 2011 186 n/a n/a n/a Freshwater Griffin 2008 880 445 435 51% Riverbreeze Griffin 2012 183 31 152 17% Park Vista Mango Hill 2011 480 24 456 5% Northbrook Mango Hill 2012 120 0 120 0% Capestone Mango Hill 2012 1,900 45 1,855 2% Forest Ridge Narangba 1993 1,998 1,957 41 98% Narangba Heights^ Narangba 2012 630 n/a n/a n/a Stone Ridge Narangba 2011 1,150 120 1,030 10% Sandstone Lakes^ Ningi n/a 211 n/a n/a n/a North Lakes North Lakes 1999 6,100 4,950 1,150 81% Warner Lakes^ Warner 2004 1,596 1,176 420 74%*Identified estates with successful survey responses comprising 100+ lots in total^Infomation not providedSource: RP Data / Colliers International Research Colliers International | p. 7
  • 8. research forecast report | second HALF 2012 | residential I seq Gold Coast Sales volumes across major Communities on the Gold Coast and Tweed Coast lifted almost 45% during the first half of 2012. A total of 438 sales were reported across 20 projects with the suburbs of Upper Coomera (120), Pimpama (90) and Kingscliff (84) recording the majority of land deals. Kingscliff recorded an increase of 280% on previous figures with the release of stages within the Salt and Seaside Communities. Ormeau Ridge at Ormeau was the most active individual project surveyed with a total of 55 sales during H1 2012, followed by Gainsborough Greens at Pimpama with 50 sales. Finance and infrastructure charges have been an on-going battle for developers over the past threeSeaside, Kingscliffe or four years. Recent conversations with industry figures indicate that banks may be more willing to41 sales were achieved within Seaside during H1 lend on development projects. The change in local council and the likelihood of reduced infrastructure2012 with construction beginning on new homes changes going forward is also a positive for the development industry and is leading to a change inwithin the first stage. sentiment. As reported in our H2 2011 report, dwelling approvals on the Gold Coast have fallen to the lowest levelKey Highlights in 16 years. The peak period was during 2003 and 2004 with levels of around 8,000 approvals being• here were 438 vacant land sales across the T recorded. Latest figures from OESR for the year ending June 2012 show a figure of approximately Gold Coast and Tweed region in H1 2012, 2,300 – well below the ten year average of 5,766. almost 45% higher than H2 2011. Latest Census data shows an increase of around 7,000 residents annually over the last five years.• rmeau Ridge was the strongest performing O These new residents would have created demand for approximately 2,800 new dwellings each year. project with 55 lots sold during H1 2012. Dwelling approval rates over the last two years have fallen well short of this demand and if this• ew dwelling approvals fell to lowest level N continues we will see a need for developers to bring forward the release of lots currently on hold. in 16 years. The long term master planned communities of Pacific Pines and Varsity Lakes have both sold out of developer stock. Pacific Pines achieved a sell out during the second half of 2011 and Varsity Lakes followed during the first half of 2012. These projects were the last major master planned communities located in central Gold Coast locations. With suitable sites to accommodate similar projects extremely scarce in centrally located positions, it is unlikely we will see projects on this scale in the foreseeable future. Future large scale master planned communities will most likely be located in the northern corridor and northern New South Wales. gold coast lga market activity residential estates* Estate Name Suburb Year Commenced Total Lots Sold to Date Remaining Yield (%) Sold Varsity Lakes Varsity Lakes 1999 4,500 4,500 0 100% Gainsborough Greens Pimpama 2011 2,200 136 2,064 6% Highland Reserve Upper Coomera 2003 1,076 625 451 58% Big Sky Coomera 2012 904 17 887 2% Ormeau Ridge Ormeau 2010 900 237 663 26% The Observatory Reedy Creek 2002 885 672 213 76% Pimpama Rivers Stgs 12-15 Pimpama Unknown 342 40 302 12% Genesis Coomera 2006 812 346 466 43% Riverstone Crossing Upper Coomera 2007 740 311 429 42% Coomera Springs Upper Coomera 2004 600 421 179 70% Salt Village Kingscliff 2003 550 523 27 95% Riverlinks^ Oxenford 2002 500 459 41 92% Coomera Retreat Upper Coomera 2007 399 220 179 55% Hundred Hills Murwillumbah 2007 315 180 135 57% The Village at Casuarina Beach Casuarina 2012 210 9 201 4% Seaside Kingscliff 2009 250 48 202 4% Stone Creek Upper Coomera 2008 208 94 114 45% The Ecovillage at Currumbin^ Currumbin Valley 2006 147 116 31 79% Longhill Rise Gilston 2007 132 131 1 99% Brookside Ormeau 2012 107 1 106 1%*Identified estates with successful survey responses comprising 100+ lots in total^ Information not providedSource: Colliers International Research Colliers International | p. 8
  • 9. research forecast report | second HALF 2012 | residential I seq New Supply Pipeline • he estimated level of future supply in this T • aking a longer term view, Ipswich and Logan T report is a reflection of remaining yields in LGA’s have the highest concentration of future existing estates in combination with land supply with the ULDA designations at Ripley subdivisions over 100 lots in various stages of Valley, Flagstone and Yarrabilba. future planning. • he advancement of these urban areas has T • uture supply levels are constantly changing as F been slower than expected reportedly as a lots are absorbed, development plans change result of planning constraints and subdued and new applications are lodged, the figures demand for residential property. indicated herein are a reflection of the current development pipeline. • ocusing on the southern Logan corridor, Park F Ridge to the west of Logan Reserve is expected • he level of near term supply is a reflection of T to see approximately 12,000 lots from the recent historical delivery rates and local geographic growth south from Logan Central. authority projections. • emand for lots in the Park Ridge corridor may D • pswich LGA has the highest level of near term I be greater than those areas further south in supply, accounting for approximately 23% of Flagstone/Yarrabilba as services and the development pipeline. infrastructure are already in place or currently being developed. • he Gold Coast makes up 21% with the Moreton T Bay and Tweed LGA’s each making up 20% • evelopers have reported limited funding and D and 19% respectively. delays with the council approval process as the key constraints to the progression of new land • ogan and Brisbane LGA’s account for the L releases. remaining 17% of lots, however this estimate excludes the significant pipeline at Park Ridge, Flagstone City and remaining stages at Yarrabilba. estimated proportion of near term future supply by LGA Brisbane City Ipswich City Logan City Moreton Bay Regional Tweed Regional Council Gold Coast City Source: Cordell / Colliers International Research Colliers International | p. 9
  • 10. research forecast report | second HALF 2012 | residential I seq General Land Market • The number of transactions increased across • The median lot size continued to decline in all five LGAs in the second half of 2011 with 2011 falling by approximately 8% over the 12 over 2,600 vacant land sales recorded, a 23% months to H2 2011. Median lot sizes have been increase over six months. On an annualised falling 2% on average, each year over the past basis, 2011 saw the lowest number of vacant 10 years. land sales since 1988. • The trend towards smaller lots may be an • Brisbane LGA saw the largest growth in indication of the prioritisation of affordability transaction volumes, increasing 35% to 585, over lifestyle for many purchasers. or 67% of the 10 year historical half yearly average. • Further to this, developers are now delivering smaller lots in an effort to maximise the • Moreton Bay saw the second largest increase feasibility of existing sites without in transactions (26%) followed by the Logan compromising liveability. (24%), the Gold Coast (17%) and Ipswich (14%). • The median sale price of vacant land increased 1% to $222,900 in H2 2011. Brisbane LGA saw the largest six monthly decline in median price falling by 6%. demand and median prices for vacant lots in SEQ Demand and Median Prices for Vacant Land in SEQ 9,000 $250,000 8,000 $225,000 $200,000 7,000 Number of Lots Sold $175,000 Median Sale Price 6,000 $150,000 5,000 $125,000 4,000 $100,000 3,000 $75,000 2,000 $50,000 1,000 $25,000 0 $0 2007 H1 2007 H2 2008 H1 2008 H2 2009 H1 2009 H2 2010 H1 2010 H2 2011 H1 2011 H2 Brisbane Ipswich Logan Moreton Bay Gold Coast Median Sale Price (RHS) Source: PDS Live / RP Data / Colliers International Research general market indicators vacant land Median Sale Price Median Sale Price Half Yearly Annual LGA H1 11 H2 11 Change Change Brisbane $291,500 $275,000 -6% -15% Ipswich $183,000 $185,000 1% 3% Logan $219,900 $210,000 -5% -4% Moreton Bay $207,650 $205,000 -1% 0% Gold Coast $231,500 $235,000 2% -3% Source: PDS Live / RP Data / Colliers International Research Colliers International | p. 10
  • 11. research forecast report | second HALF 2012 | residential I seq General House Market • The number of new and established house • Transaction volumes and median sale prices sales increased 13% over H2 2011 with across all identified LGAs had inverse 15,460 transactions. On an annualised basis relationships. An indication that vendors may there were 29,193 sales over the 12 months have begun to meet the market on price to December 2011. expectation. • For the third consecutive half-year, the • The correction in house prices appears to be median sale price for new and established related to market sentiment, which has been dwellings declined. At $445,000, this deteriorating over the past few years. represents a 3% fall over the six months to H2 2011. • A reduction in interest rates in the second half of 2011 may have enticed some potential • Median prices fell across all five areas over buyers to enter the housing market. However, the last six months of 2011. Houses on the it is likely that many buyers will be awaiting Gold Coast experienced the largest fall, market sentiment to improve prior to declining 5%. committing to a purchase. demand and median prices for houses in SEQ Demand and Median Prices For Houses in SEQ 35,000 550000 500000 30,000 450000 25,000 400000 Number of Lots Sold Median Sale Price 350000 20,000 300000 250000 15,000 200000 10,000 150000 100000 5,000 50000 0 0 2007 H1 2007 H2 2008 H1 2008 H2 2009 H1 2009 H2 2010 H1 2010 H2 2011 H1 2011 H2 Brisbane Ipswich Logan Moreton Bay Gold Coast Median Price (RHS) Source: PDS Live / RP Data / Colliers International Research general market indicators houses Median Sale Price Median Sale Price Half Yearly Annual LGA H1 11 H2 11 Change Change Brisbane $521,000 $510,000 -2% -6% Ipswich $317,000 $307,500 -3% -4% Logan $375,000 $360,000 -4% -5% Moreton Bay $395,000 $380,000 -4% -7% Gold Coast $500,000 $477,000 -5% -6% Source: PDS Live / RP Data / Colliers International Research Colliers International | p. 11
  • 12. research forecast report | second HALF 2012 | residential I seqOutlook 522 offices inApprovals for the creation of new vacant lots and construction of private sector dwellings declined 62 countries onover the 12 months to March 2012. Population growth forecasts have been revised after the 2011Census revealed a lower than expected population increase over the last five years. The population 6 continentsgrowth in SEQ is expected to be relatively strong looking forward, and as a result, should place United States: 147 officesupward pressure on demand for accommodation. Canada: 37 offices Latin America: 19 officesThe latest Queensland budget has revealed new stimulus for the housing construction industry Asia Pacific: 201 officeswith the removal of the previous $7,000 grant for the purchase or construction of new and EMEA: 118 officesestablished dwellings. The new measure provides a $15,000 grant for first home buyers enteringinto a contract to purchase or build a new home only. The purchase of established dwellings is no • $1.8 billion in annual revenuelonger an option under the new arrangements. This stimulus should provide some additional billion square feet under • 1.25incentive for first home buyers to enter the residential communities market, especially in managementcombination with incentives on offer direct from developers. Although this new grant should • Over 12,300 professionalsstimulate some purchasers, perhaps more needs to be done in order to create greater demand forall new residential property.Significant changes to planning processes have been put forward by the State Government which COLLIERS INTERNATIONALsees the alteration, or abolition of up to 20 policies, including the removal of strategic cropping Level 20, Central Plaza One,land and devolution of the State Planning Regulatory process. The major outcomes from these 345 Queen Streetchanges have been identified as the release of land previously designated as ‘open space’ Brisbane, QLD 4000becoming subdivisible and the potential to expedite the delivery of land through the development tel 07 3229 1233and planning process. FAX 07 3120 4583Prohibitive costs associated with land production, coupled with tighter lending conditions havebeen identified as barriers for new development projects and as a result, may constrain the newsupply of land in SEQ. Developers have continued to highlight infrastructure charges, insufficient researcherinfrastructure in certain regions and a convoluted planning process as major obstacles in land Alex Beerproduction. As a result of these challenges there is a significant amount of future supply in Analystdifferent stages of the planning process. Colliers International estimates there are approximately tel 07 3026 330566,600 lots in the supply pipeline at both current and future projects in various stages of approval. Lynda CampbellThis does not include initial estimates of supply with the ULDA urban development areas of ManagerYarrabilba, Flagstone and Ripley Valley which are expected to comprise 120,000 dwellings over tel 07 5588 0290the long term according to the government body. residential land marketing Andrew Scriven Director Residential tel 07 3026 3344 Colliers International does not give any warranty in relation to the accuracy of the information contained in this report. If you intend to rely upon the information contained herein, you must take note that the information, figures and projections have been provided by various sources and have not been verified by us. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. Colliers International will not be liable for any loss or damage resulting from any statement, figure, calculation or any other information that you rely upon that is contained in the material. COPYRIGHT - Colliers International 2012. Accelerating success. Colliers International | p.