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What will happen to the Gold Coast market after the floods?

Written on the 21 January 2011 by James Cagney

What will happen to the Gold Coast market after the floods?

Firstly, our hearts go out to those families who have lost family and friends. In true Aussie spirit many folk are picking themselves up from despair and making the best of what they have left.

I am a fan of Michael Matusik, a Queensland property guru, and you will find his views frank and sometimes controversial. I wholeheartedly agree with his views on the future of South East Queensland (SEQ) so go to Matusik Massive for his report on what will happen to the Queensland property market after the floods.

Many folk in the flooded areas of Brisbane will take up temporary holiday accommodation on the Gold Coast until they can sort out their insurance and repair their homes. The good road and rail system from the Gold Coast to Brisbane will make it easier for displaced residents to access the schools and their jobs in Brisbane.

Few investment property experts can claim to have got it right in 2010 ( Michael Matusik one of the exceptions). The property market throughout Australia was unpredictable to to say the least over the last few years. Fortunately, I managed to get a number of things right so go to the "News" section on my website or click and click on "Updates" for some valuable insights into why the market performed the way it did in 2010.

My predictions for the Gold Coast property market in 2011 and 2012:

(1) Property investors who capitalised on good growth areas in Melbourne and Sydney in 2009/2010 will be looking for more affordable, value-for-money properties in Queensland. These investors will be looking for higher yields as rents have not caught up (and unlikely to catch up for at least three years) with the rapid growth in property values that these cities have experienced. The Gold Coast offers far better yields than Melbourne and Sydney at present. 

(2) Investors will be cautiously optimistic. Since mining towns are renowned for boom and bust due to commodity prices and natural disasters (particulaly after the adverse media attention they have received), investors will be looking at more stable areas like the Gold Coast to invest.

(3) Investors will avoid buying in Central and Northern Queensland because of the potential danger of cyclones and floods. The over exagerated publicity to the extent of the floods that Brisbane experience (and I am not minimizing the distress that some families have experienced) will cause many investors to look at the Gold Coast.  

(4) The Gold Coast property prices are low in comparison to other major cities. Investors will be seriously looking for bargains and over priced high rise properties will have to offer huge discounts to attract buyers. 

(5) The Baby-Boomers will be looking at the Gold Coast as a viable place to retire. They will be looking at lifestyle-rich properties either close to the beach or in the hinterland which is only 12 kms from the Coast line. Many of these baby-boomers typically rent for a year or so until they find the right property for them before the buy.

(6) Due to poor Christmas retail sales as well as the slower property market throughtout Australia over the festive season, the Reserve Bank will hold off interest rate hikes for the 1st Quarter of 2011. The Queensland, NSW and Victoria floods will cause foodstuff prices to rocket and this will affect the CPI figures. Data regarding the economy is due to be released late January and February 2011 and this will influence the Reserve Bank's decision for the 2nd Quarter.

(7) Those investors who take advantage of the low prices on the Gold Coast and buy in the 1st half of 2011 will enjoy exceptional capital growth when the market takes off in late 2011 and early 2012.

Please take a moment and tell me what you think is going to happen in the South East Queensland property market during 2011 and 2012 by clicking >>>> my view .

For more information about our services go to www.jamescagney.com.au or give me a call on 0416 137 645 Monday through Saturday AEST 10h30 to 20h00.

Disclaimer

This is not advice. You should not act solely on the basis of the material contained in this article or on the website. Changes in legislation occur frequently and without prior notice. Items herein are general comments only and do not constitute or convey advice per se.


Author: James Cagney
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