Gold Coast property sales have taken their biggest hit since the boom, with a shock drop of almost 30 per cent in transactions compared with the same time last year.
But homebuyers hoping to bag a bargain amid slower market conditions should think again, with house values in every Gold Coast suburb still tracking above pre-pandemic prices.
The PropTrack Gold Coast Insights report shows sales volumes in July 2022 were down 27 per cent compared with the same time in 2021.
It was the largest fall this year, while sales volumes over the first seven months of 2022 were down 16 per cent.
But despite a downward trajectory since May, median prices were higher than in March 2020, when Covid controls were introduced.
PropTrack economic research manager Cameron Kusher said the fall in sales volume this year had been more dramatic for houses than units.
Gold Coast property sales are on a downward trajectory
“Demand for property on the Gold Coast is just not as strong as it was during the pandemic because that impetus for people from Sydney and Melbourne to move is no longer there,” he said.
“Particularly for houses, sales have really fallen away since May when we had that first interest rate hike,” he said.
“As interest rates go up, people can’t borrow as much, so whilst they may want to buy a house, they can’t borrow as much now so perhaps they can now only afford a unit.”
Mr Kusher said vacant land sales had also dropped, as buyers shied away from taking on new building projects amid the current construction crisis.
The house market has been impacted more than unit sales
Herron Todd White associate director Sam Gray said property values across central Gold Coast areas had softened, although some market segments were holding firm.
“Given the downward trend in the market and the challenge of meeting vendor price expectations, many local agents are reporting that this is an extremely difficult market in which to set an asking price for listed properties,” Mr Gray said.
“Buyers know they have more time up their sleeves to negotiate as there are less people in competition and properties are typically taking longer to sell.
“Some prospective buyers are of the opinion that this recent decline in market activity will only be a short term blip but are still holding off making a decision and taking a wait-and-see approach,” he said.
Migration levels have also eased
The decline in active buyers had resulted in many auctions cancelled or postponed due to lack of registered interest, Mr Gray said.
Renovated or newly built homes were continuing to attract solid inquiry, particularly from interstate purchasers.
Buyers agent Matt Srama said prospective buyers could take advantage of slow market condition to harness greater negotiaitng power.
“You want to be buying when confidence in the market isn’t too buoyant,” Mr Srama said.
“When I look at data I take it back 60 to 90 days, and in this case that was May when the first rate rise was announced.
“It takes a while for that sentiment to bubble through, but while the sales volume is down it’s a good opportunity to buy because there is less demand and that is what determines prices,” he said.
Prices are holding above pre-pandemic levels
Biggest hurdle for Qld downsizers
Spring selling outlook
Ray White Surfers Paradise chair Andrew Bell said vendors were reluctant to list their properties.
“All the buyers keep saying the same thing they’ve said for the past two and a half years, which is that there’s not much to choose from,” Mr Bell said.
He said forecast high levels of migration to the area would underpin continued demand, shoring up prices against a more severe downturn.
“We’re not going to avoid a softening in prices, because as interest rates have risen, the capacity to borrow the same amount of money has been diminished, so there’s a restraint on many buyers to pay higher prices,” Mr Bell said.
New and renovated homes are still in demand
“But we’re nowhere near what’s happening in the major cities, and that’s largely because we still have this strong migration to the city, although not at the same record rate as during the pandemic.
“I am not suggesting we won’t have some softening of prices because that is already happening, but I think the Gold Coast will be one of the better performing markets of this cycle,” he said.
The Surfers Paradise branch received 10,000 inquiries for rental properties per month, with a high proportion of those from interstate residents planning to move to the Sunshine State.
Statewide, home values were lower than in March 2020 in 34 suburbs.
Buyers are taking a wait-and-see approach
The post Biggest hit to Gold Coast sales since the boom appeared first on realestate.com.au.