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The Courier-Mail | February 18, 2012 | Kimberley Vlasic

BRISBANE rents are going through the roof as demand exceeds supply and forces prospective tenants into share accommodation.

Real Estate Institute of Queensland chief executive Anton Kardash said the rental property market in the past 12 months had been the tightest since 2007, with agents receiving an average of five applications per rental listing.

“Higher rents are, of course, driven by more demand than supply,” Mr Kardash said.

“However, the lower interest-rate environment means rent increases in Brisbane have not been out of step with the current economic conditions.”

He said the start of each year was traditionally the busiest time for the Brisbane rental market due to tertiary enrolments and job transfers.

Mr Kardash said the high demand could also be attributed to potential first-home buyers and investors sticking to the sidelines.

Statewide co-ordinator at the Tenants’ Union of Queensland Penny Carr agreed but also said that input costs rarely factored into rent prices.

“The reason people are finding it hard to rent is because the market is not expanding at a fast enough rate to accommodate the growing numbers of people looking,” she said.

“We’re seeing a lot of people sharing when they probably would rather not because of rent prices.”

Residential Tenancies Authority median rent data shows prices of units, houses and townhouses have increased by at least $90 in the past five years.

Three-bedroom units have jumped $160 to $480 a week from December 2006 to December 2011 and four-bedroom houses $125 to $475 a week in the same period. Property categories where rent has risen least include one-bedroom units with a $90 increase to $300 a week, and three-bedroom houses and two-bedroom townhouses, where there has been a $95 increase to $395 and $360 a week, respectively.

The RTA’s 2010 annual report found that more than 30 per cent of Queensland properties were rented, ranking it second in the country behind the Northern Territory.

Almost half of those properties are in Brisbane.

Houses in inner Brisbane and units in the remainder of the city also had the lowest vacancy rates last year, according to data published by the Queensland Government’s Office of Economic and Statistical Research.

Both were down 0.3 per cent to 2.7 per cent and 3 per cent, respectively.

“However, activity from both these types of buyers is beginning to strengthen, which will increase the supply of rental properties to the market,” Mr Kardash said.

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via Rents rocket across Brisbane as demand exceeds supply | Reviews and Recommendations | The Courier-Mail.

Folks like Chris Zappone at the SMH like to give Steve Keen‘s predictions enormous attention on the SMH’s website. I don’t have any issues with this – that is Chris’s journalistic call. But a reader wrote to me the other day with an itemised list of Keen’s forecasts, which is more thorough than I have ever seen before. He asked whether I could post it up, and today I have obliged.

Reader comments…

It is a revealing exercise writing down some of the claims Steve Keen has made:

1. In 2006, Keen said we may already be in a recession. We were not.
2. In 2006, Keen said the Australian Debt/GDP ratio would exceed 160% by 2007. It did not.
3. In 2006, Keen said Australia will be in recession long before our Debt/GDP ratio falls. We did not go into recession.
4. In 2008, Keen said interest rates would be at 2% by 2009, and ZERO by 2010. The interest rate trough was 3%; today rates are at 4.25%.
5. In 2008, Keen said we would have double-digit unemployment up to 20%. Unemployment only rose to 5.8%, and is 5.3% today.
6. In 2008, Keen said we would have a severe recession, possibly a depression. We had neither.
7. In 2008, Keen said house prices would be down 40% within ‘a few years’. They fell by about 3% in 2008 less than one-tenth of what Keen predicted, rose strongly in 2009, rose again in 2010, and have fallen by 2.8% in 2011.
8. In 2008, Keen famously made a house price bet with Westpac’s Rory Robertson, which he lost, forcing him to hike from Canberra to Mount Kosciuszko wearing a T-shirt exclaiming, “I was hopelessly wrong on house prices – ask me how.”
9. In 2008, Keen sold his Sydney home at a cyclical low point, just before prices rose more than 10%. What tha?
10. In mid 2010, Keen predicted “an accelerating rate of decline in [Australian] house prices now, as they did in the USA when “Flip That House” ceased being a winning trade.” In Zappone’s latest SMH profile of Keen, he makes exactly the same prediction again. Zappone writes that Keen expects an “accelerating slide in prices.” In fact, Australian house price declines have not accelerated. They have depreciated slowly and consistently by a cumulative 2.8% in 2011. [Christopher Joyce adds: Yes, there is leading indicator evidence to suggest that rate of price declines will soon slow to a halt.]

Every single one of these calls has been wrong.

Read more…

Sun Community Newspapers   |  12:01am February 15, 2012

COOMERA has been earmarked for a $300-$500 million World Trade Centre which would raise the international profile of the Gold Coast.

The proposed development would have a 20-level office tower, 288-room hotel, four-level conference facility and a themed shopping village. Multimillionaire Peter Chen, of the Sabina Corporation Ltd, said the project would generate 500 jobs.

He has already held meetings with Queensland director-general John Bradley and the state director of economic policy Paul Sariban.

“I have also had discussions with Gold Coast City Council planning officers to investigate whether a World Trade Centre at Coomera would be acceptable under the Local Structure Plan,” he said.

“The World Trade Centre brand is known around the world and after 40 years, the World Trade Centres Association serves nearly one million businesses and organisations.”

Mr Chen said the WTC would complement the proposed Coomera Town Centre and spur on its development.

“We also plan to introduce two specialised study courses in tourism hospitality and international trade for young people,” he said.

“WTC will work closely with the local TAFE to tailor these courses and training programs for youth in the area.”

The project would be on a 7.3ha site and the shopping mall will have 75 two-level and three-level mixed-use, themed cottages which will target Chinese visitors to the Coast.

“These will consist of mini-restaurants, shops selling only Australian-made products and guest services such as parcel mail and foreign exchange outlets,” Mr Chen said.

via World Trade Centre plan for Coomera Local Business | goldcoast.com.au | Gold Coast, Queensland, Australia.

Lucy Ardern | January 11th, 2012

CHINESE tourists will be targeted by a $300 million project next to the Westfield shopping centre at Coomera.

To be built by Sabina Corporation, it will have several Asian restaurants and cafes and perhaps a hotel and health spa.

Sabina chairman Peter Chen said the project was well timed, given China was set to become the city’s largest international market as early as next year.

The listed Gold Coast company announced this week it had signed a conditional contract on a 7.3ha site, which is part of the Coomera Town Centre Precinct, with co-owners Qhuinnco and Trimglint for $19.63 million.

Completion of the contract is subject to the development plan receiving approval from the Gold Coast City Council, and Sabina Corporation has also flagged it will need to secure significant finance or investment to proceed. Read more…

Queensland property market “In Pretty Good Shape”, says Savills Australia chief executive Paul McLean.

The Courier-Mail February 09, 2012
by: Chris Herde

WHILE there are “a few unknowns” for 2012, the fundamentals remain strong in the Queensland property market, says Savills Australia chief executive Paul McLean.

Mr McLean, who has just returned to Queensland after a few years in Sydney, said the Sunshine State was in “pretty good shape”.

“As you know there was a huge downturn in the market with the floods etcetera which had a devastating effect on Queensland,” he said.

“But I sensed towards the middle of last year that Queensland, certainly Brisbane, was coming out of it much more quickly than people thought.

“There are still a few unknowns out there but I think the basics are pretty good in Queensland.

“There is demand at the moment. There is going to be some rental growth, certainly in the CBD and fringe and I think the unknown is in the investment market what’s going to happen there.

“The credit squeeze is still on, we know that. It’s very tough to get finance. It’s very tough to get funding for development. But I think there is some light at the end of the tunnel in that regard.”

For information about investment property opportunities in Queensland send me a request >>>here

via Queensland property market ‘in pretty good shape’, says Savills Australia chief executive Paul McLean | Reviews and Recommendations | The Courier-Mail.

Deloitte | Investment Monitor | December 2011

1 February 2012: Australia’s investment agenda continues to grow.  The December 2011 issue of Investment Monitor sees a further gain in the value of projects recorded of $18.7 billion, or 2.1%.  The value of projects in the database has increased by 17.5% over the past year.

Importantly for current activity in the Australian economy, much of the recent growth has been in definite projects (those classed as under construction or committed to commence soon).  In December 2011 they reached a value of $415.4 billion, a 2.1% increase on the value recorded in the September quarter, and a massive 43.0% rise over the past year.

Read more…

By Larry Schlesinger
Monday, 30 January 2012

There is no Australian housing price bubble, says ANZ in its latest assessment of the Australian property sector.

In its January assessment of the property market, the bank argues that gains in house prices over the past 25 years have been driven by increases in household income and lower interest rates.

The bank forecasts house prices will remain on hold or fall slightly in 2012, but will not crash.

“A combination of lower interest rates, falling house prices and rising household incomes has improved Australian house purchase affordability over the past 12 months,” say report authors David Cannington, senior economist at ANZ, and Paul Braddick, head of property research at ANZ.

“Despite the continued concerns about significant Australian house price overvaluation from some commentators, housing market fundamentals remain supportive,” they say.

According to ANZ’s analysis, all the growth in Australian house prices since 1986 can be explained by gains in average household incomes and a structural decline in the cost of borrowing.

“Cross-country comparisons using partial valuation measures are commonly used to contend the case of overvaluation of Australian house prices. That is, suggesting actual house price growth in Australia has run significantly higher than justified by explained price growth,” says ANZ.

However, international house prices, rental yields and house price-to-income ratio comparisons compiled by ANZ suggest that Australian house prices have not deviated from international trends.

ANZ forecasts housing affordability to improve in 2012 following recent improvements due to softening house prices, rising household incomes and lower mortgage rates.

Among the factors ANZ says will continue to support the housing market is net migration, which is starting to rebound after the recent slowdown and combined with weak housing construction will add to the pressure building within the housing sector.

“While housing construction continues to weaken under the cloud of negative market sentiment and softening prices, forward indicators suggest the recent slowdown in net overseas migration will continue to reverse,” say Cannington and Braddick.

“This renewed housing market tightening will add further upward pressure on rents, household size and provide a fundamental support to flagging market activity, especially for the first-home buyer market.”

However, there will be no marked improvement in new home building in 2012, according to ANZ.

“Soft house prices, weak housing market sales activity and tight credit conditions have dampened residential developer sentiment. Despite the recent interest rate cuts, weak housing market sentiment will continue to weigh on residential development activity through 2012,” says Cannington and Braddick.

via Residential – Strong fundamentals mean there is no Australian housing price bubble: ANZ.

Vaughan Mayberry |The Sunday Mail (Qld)| January 22, 2012

It’s good news for landlords after recent statistics from the Residential Tenancies Authority showed rents remained flat during the second half of last year.

January is usually the busiest month for property managers as university students shore up their digs for the year and workers start relocating from southern states.

Agents are once again reporting massive crowds at recent rental inspections.

Ray White CBD/South Brisbane has one of the inner city’s largest rent roles and principal Dean Yesberg says January has been “absolute pandemonium”.

“We have got multiple people lining up for properties, multiple inspections at the same time and multiple applications going on properties,” he said.

“Last year with the floods there was more pandemonium. There were people that were flooded out of their house trying to find a property so it’s not as busy as last year.”

He said one and two-bedroom apartments were the most popular and on average there had been a 5 per cent increase in rents recently.

On the Gold Coast, LJ Hooker Surfers Paradise principal Tony Tooma says vacancy rates are the lowest they have been for some time.

“We’re down to about a 2.5 per cent vacancy rate and days on market are down to 10 days. Rental rates are holding,” he said.

“The better properties are going the day they become available. We don’t have a house to rent as we have leased them all.

>>>Property landlords have their pick of tenants | Reviews and Recommendations | The Courier-Mail.

By Terry Ryder, 12 December 2011

The two weakest city markets this year, Perth and Brisbane, are poised for a change in status.

I expect them to emerge as the strongest city markets next year.

The two cities have much in common: boosted by the emerging resources boom, both have seen CBD office vacancies contract and demand for industrial property grow. Both are seeing growing airport traffic from fly-in-fly-out workers.

Both are seeing improving sales volumes and rising rents for residential property.

The next stage is an increase in prices.

>>>> Perth and Brisbane to benefit from boom.

Michelle Collins | Sunday Mail 4/12/2011

UNITS continue to outperform houses in Brisbane, according to the latest market research from property analysts RP Data.

RP Data analyst Cameron Kusher said Brisbane house values had increased at an annual rate of 8.2 per cent on average over the past decade compared to annual growth of 9.2 per cent on average for units.

“The superior performance of units is partly due to the fact that values were lower to start with but it also indicates that medium and high-density housing is growing in popularity,” he said.

He attributed the popularity of units to price and rental returns.

“Units offer owners the opportunity to live in locations of the city in which they would otherwise not be able to own a detached house,” Mr Kusher said.

“As cities continue to grow, location becomes increasingly important.

>>>> Unit values outperform houses over the long haul | Reviews and Recommendations | Courier Mail.