PROPERTY MARKET BALANCING ACT
While the Capricorn Coast property market is finally stable and showing promising signs for the future, the market is still finding a balance among some sectors. In 2016 there were just over 1800 properties for sale, now in 2020 there are just over 1150 properties for sale, that’s about a 36% decrease in stock available on the market in 4 years. A reduction in stock is a great sign of an improving market, and a 36% reduction is significant.
However, in the short to medium term there is likely to be a ceiling, or a limit as to how much prices may improve by, as the Capricorn Coast market still appears to have an oversupply of land. Interestingly there are just over 400 houses currently for sale on the Capricorn Coast, however there are approximate 550 vacant blocks of land for sale. Traditionally, as long as there is plenty of land available, home buyers will only pay up to the same amount for an established home as they could potentially build a new home for, creating a ceiling on the prices of established home or existing stock, until the surplus stock is sold.
There does appear to be some good news on the horizon, the volume of land sales and medium sales prices are on the rise. In the second half of 2019 there were approximately 65 vacant allotments sold on the Capricorn Coast, while the previous six months, the first half of 2019 there were only approximately 41 blocks of land sold. That’s a massive 37% increase in the number of land sales per half year. Also from the first half of 2019 to the second half of 2019 the medium sales price increased from approximately $178 500 to $182 000 which is a modest 2% increase.
Another interesting statistic to watch is the housing approval numbers for the Livingstone Shire Council area, as they have been steadily decreasing from 270 in financial year 2015/16 down to 114 in 2018/19. However, the first quarter of 2019/20 recorded 56 housing approvals. If housing approvals continue at the same rate as they did for the first quarter of 2019/20 all the way through the year, would mean 224 approvals for the 12 month period, almost double of the previous year. Not only is this a good sign that the oversupply of land may be corrected and return to balance, it is also a great sign for our local economy and construction jobs.
All in all the @ Real Estate team are excited about 2020 and are looking forward to an improving Capricorn Coast property market.