Media release – date CALOUNDRA PROPERTY MARKET RECOVERY SET TO STRENGTHEN IN 2012 Michael Kettle from First National Real Estate Caloundra says the local property market is showing some potential for 2012, with signs that a slow recovery is just around the corner if consumer confidence returns and job prospects improve “In the last six months, the market has been falling, and as 2012 this is expected to continue until the local economy strengthens and affordability improves,” Mr Kettle said in the First National 2012 Property Market Outlook released this week. The key challenges facing the region’s property market in 2012 will be creating buyer confidence and creating employment opportunities so that money will be put back into real estate. “Lower interest rates will also make it more affordable for people to invest in, and upgrade, properties,” Mr Kettle said. According to the Outlook, residential property prices in Caloundra are expected to trend downwards in 2012 across all sectors of houses, apartment/strata and land due to poor market conditions where buyers are taking their time to make a decision due to nervousness arising out of uncertainty in local and global economies. “Downward movements of between 5 and 10 per cent are expected with a slow local economy affecting buyer confidence and keeping sales volumes low,” Mr Kettle said. “Apartment/strata price decreases could be slightly more, between 10 and 20 per cent due to high stock levels forcing owners to compete on price to capture sales. “Developers are releasing less land and local council stringent requirements are making it difficult for developers so they are more inclined to look elsewhere. In addition, costs are being pushed up often to the point of being unsupportable by the developer. “The commencement of the new university hospital in the area will help boost the region by providing new jobs and extra services”. The rental market outlook is a bit more positive as a fairly even supply and demand equation will see prices and rates hold steady. Mr Kettle expects Upgraders to represent the strongest growth in activity in the Caloundra region due to families who are upgrading and moving to the coast and setting up home while the main bread winner works in the mines. “However, investor activity is expected to increase by between 1 and 5 per cent,” Mr Kettle said. “As the market drops the rental returns are improving and a lot of people believe the bottom of the cycle has been reached.”
Interest rates are expected to further decrease in the first half of 2012, by between 1 to 1.5 per cent. “These lower interest rates will make property more affordable and allow people to have more disposable income to help boost the local economy,” Mr Kettle said. “There has been some increase in default mortgages and this trend is expected to continue into 2012. There are a lot of people finding it hard to make ends meet and a high percentage of selfemployed people on the Coast who are finding it harder to stay in the area and find work.” The economic events in Europe and America are expected to continue to impact on buyer confidence until some stability returns. The introduction of the carbon tax is expected to affect the local property market, further reducing consumer confidence. -
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Issued by: First National Real Estate. For further information or to receive a copy of the 2012 Property Market Outlook, Michael Kettle, Principal from First National Real Estate Caloundra, on 07 5438 2166.