The Year Ahead

The New Year is here, and while there’s a lot of optimism for 2023, a lot of questions remain about the Gold Coast property market.

How resilient will Gold Coast property prices be? Will interest rates continue to rise? And will the development and construction industry continue to face the challenges that occurred last year?

After having our biggest year yet with a $100-million revenue, Lacey Group is preparing for a monumental year ahead but is also conscious of the ever-changing market.

Many are saying that the Gold Coast property market is expected to stay strong and international tourism is expected to increase. However, while Lacey Group’s advisory board are cautiously optimistic, there is also talk of further inflation and increased interest rates.

“Interest rates and the availability of mortgage finance will have a big impact,” said Lacey Group Advisor Russell Shields.

“With inflation expected to continue during 2023 at very high rates, interest rates are unlikely to fall in the next little while, so banks re-evaluating loan servicing requirements in a high inflation environment will be a problem.”

According to Lacey Group advisor and CBRE Managing Director Mark Witheriff, it’s the construction industry that could impact the rate of development this year.

“There is no doubt there is demand for new product, however it is the delivery timetables that are causing stress in this current cycle,” Mr Witheriff said.

The consensus from all of the team is that the Gold Coast will continue to reap the benefits of a post COVID environment, with interstate and international migration not showing signs of slowing any time soon.

To help navigate and provide some insight into the year ahead, we asked members of the Lacey Group Advisory Committee to share their outlook.

Russell Shields – Lacey Group, Advisor

Q: Will the Gold Coast Property Market performance in 2023 be better, worse or much the same as 2022?

A: I believe there will be a strong market given that the rate of interstate migration will not slow down any time soon. Post Covid restrictions on tourism (especially from China) will also keep the demand profile strong, with focus on the apartment market.

Q: In your opinion, what are the key issues that will have the greatest impact on the Gold Coast Property Market over the next 6-12months?

A: Interest rates and the availability of mortgage finance will have a big impact. With inflation expected to continue during 2023 at very high rates, interest rates are unlikely to fall in the next little while banks are re-evaluating loan servicing requirements in a high inflation environment will be a problem.

Q: Is the Gold Coast Property Market well positioned to outperform other Australian Markets over the next 1-2 years?

A: It certainly is. Retirees from the southern states with loads of cash seeking improved lifestyle experience will be a big factor.

Mark Witheriff – Lacey Group, Advisor

Q: Will the Gold Coast Property Market performance in 2023 be better, worse or much the same as 2022 and why?

A: The initial thought for the year is one of cautious optimism, however we are still in a high inflationary environment and there is a belief that there will be further raises in interest rates in the foreseeable future. We have witnessed continual demand for both residential and development opportunities over the Christmas and early New Year period and this is due to a fundamental shortage of accommodation across the Gold Coast and the clear understanding that population growth has continued.

Q: In your opinion, what are the key issues that will have the greatest impact on the Gold Coast Property Market over the next 6-12months?

A: It has been well publicised that the construction industry is under duress, and it is difficult to find builders who are in a position to take on new projects and this, coupled with the inflationary costs of building products, has made feasibilities for new developments particularly difficult. There is no doubt there is demand for new product, however it is the delivery timetables that are causing stress in this current cycle.

Q: Is the Gold Coast Property Market well positioned to outperform other Australian Markets over the next 1-2 years?

A: I think the fundamentals of the Gold Coast are as strong as I have seen them in 30 years and this trend does not seem to be subsiding any time soon. This gives me great confidence in the strength of our market in comparison to many others, particularly capital cities. An interesting fact is that not only is the residential market strong and suffering significant shortage of supply, but the same can be said for the commercial office sector which is at historic lows in terms of vacancies, and this has been driven by new businesses or existing businesses expanding to support the influx of population growth. If we look at the CBD markets around the country, this is a very different trend and therefore puts us in a very strong position in the foreseeable future.

Scott Springer – Lacey Group, Advisor

Q: Will the Gold Coast Property Market performance in 2023 be better, worse or much the same as 2022? 

A: It’s expected to be slower for the start of 2023 due to increasing interest rates and inflation figures until interest rates stabilise and people regain confidence in the market.

Q: In your opinion, what are the key issues that will have the greatest impact on the Gold Coast Property Market over the next 6-12months? 

A: Interest rates and the banks lending criteria for peoples borrowing capacity. Also, interstate migration boosting the demand for property on the Gold Coast.  Supply and the availability of new stock being delivered versus the demand for new stock.

Whether you’re looking to purchase a property or to invest, we’re committed to assisting you with maximising your Return on Investment (ROI).

For more advice, speak to of Lacey Group’s experienced Advisors by contacting [email protected]

 

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