The Gold Coast prestige residential market is now characterised by volatility. After a period of frantic buying during the COVID era, buyers have now become more discerning. Whilst spiralling interest rate rises have resulted in subdued demand, the Gold Coast prestige sector remains sheltered to a degree due to the significant number of cash buyers and limited availability of properties.
A Game of Two Halves – Gentrification and Remarkable Gains
Recent years have witnessed the gentrification of the Gold Coast, compounded by the Covid-19 pandemic and historically low interest rates. These factors resulted in unprecedented gains in property values for both prestige units and houses. The market reached its peak towards the end of 2021, marked by a dominance of owner- occupiers. Property prices soared, doubling in some cases, with a notable influx in buyers from Sydney and Melbourne who now call the Gold Coast home rather than a holiday destination. The ‘Sea Change Shift’ often referred to by demographer Bernard Salt, appears to be enduring. Technological advancements now enable city dwellers to work from areas that were traditionally only viewed as holiday destinations.
Current Status and Challenges
Having crossed the midpoint of 2023, it has become apparent that the market has generally plateaued and, in specific localities, experienced decline. With strong sales still being recorded, the lack of stock and the shifting change within various micro dynamics has led to caution within the buying fraternity. Purchasers are now more selective, looking for properties that tick all the boxes, and are no longer willing to jump over each other for the ‘ugly duckling’ of a property, despite a premier beachfront or hinterland location.
While the market is generally perceived to have cooled off by an estimated 5-10%, the unit market appears to be outperforming that of housing.
Moving Forward
The Gold Coast prestige juggernaut has largely lost its momentum, yet the lack of stock continues to drive strong sales. The city is now home to numerous interstate arrivals who have relocated due to the influence of the Covid-19 pandemic. No longer is the area known for its transient population and fly-by-night businesses, but rather buyers who wish to establish both work and family without the pressures of capital city life. Consequently, high net worth individuals, traditionally concentrated in the southern states, are now attracted to the recent gentrification of many aspects of the Gold Coast, with prestige property being just one of these factors.
While the Gold Coast’s prestige property market will no doubt succumb to the peaks and troughs of natural property cycles, the long-term trajectory appears positive. The migration influx and planned infrastructure projects are expected to compliment this ideology. Once these elements are intertwined with the overall rejuvenation of the Gold Coast along with the modernised theme of current architecture, a new era for this asset class will likely prevail.
Benchmark Sale
One of the most highly anticipated auctions of 2023 was that of the waterfront home located at 59 The Corso, Surfers Paradise, situated within the Isle of Capri enclave. This tri-level mansion, spanning 6 bedrooms and 6 bathrooms across 4 adjoining allotments totaling 2,197sqm, sold for $24 million. With expansive water and Surfers Paradise skyline views, multiple interest rate rises did not constrain buyer activity for this auction in July, which attracted numerous registered bidders.
Source: RP Data
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