Q1 is the iconic 80-story skyscraper – impressive even on the Gold Coast, Australia’s home of skyscrapers. Q1 is Australia’s tallest residential tower was completed.
Less impressive are stories emerging of the losses that some property investors are taking. One 4-bedroom apartment on the 72nd floor was bought in March 2005 for A$3.4 million was re-sold in January this year for A$2.75 million, which is still a lot of money for a 417 sqm apartment, even one with “stunning views”. Which it should have as Q1, at 322.5m high, is the world’s tallest residential tower and the world’s 20th highest tower.
The Minerals Council of Australia is now predicting that the mining sector will need another 87,000 more workers over the next decade.
Most jobs will be for skilled and semi-skilled mineral sector tradesmen and and amaller increase in related professionals. The commodities of biggest demand are iron ore and coal, though copper, uranium and gold are also in high demand and likely to remain so with the continuing Chinese and Indian demand for minerals. The locations of these minerals will dictate the growth of Australia’s economy for decades to come.
New Zealand is a country with a population of only 4 million people – about the same size as Sydney – but with its own currency, fiscal policy and property market. One thing you can never accuse New Zealand property of is being dull.
Just released, Mercer’s 2008 Cost of Living Survey makes some interesting reading for those considering a move downunder, that is to Australia or New Zealand.
The Mercer’s survey looks at comparative costs for an expatriate moving to each of 150 world cities. The 2008 survey confirmed Moscow as the world’s most expensive city, the “winner” for three years in a row. Tokyo and London were second and third most expensive respectively The survey is still dominated by Asian and European cities in the top 10 spots but the Australia and Pacific region has been catching up – based, at least in part, on the weakening of the US dollar against most other major currencies.
The grass is always greener syndrome appears to be alive and well for Australian real estate investors. Several firms are advertising in Western Australia highlighting eastern states property investment opportunities. While at the same time strong growth rates in Melbourne, Queensland and NSW mean that some eastern states investors are viewing Western Australia as affordable in comparison.
South Australia’s capital, Adelaide has only recently started to grow at a rate better than 1% a year. Located between the sea and the wine-growing hills Adelaide is a still a compact city and an oasis in one of the driest states of Australia. A “town” in South Australia is defined as having more than 500 residents and the top 10 in population increase between 2001 and 2006 split neatly between tree-changers and sea-changers.
Foreigners Buying Australian Property
Australia restricts what real estate non-residents can buy. Essentially it is lot easier to invest in commercial property than it is residential property: the Australian government sees an economic benefit for investment in commercial operations but is less clear on the benefits for Australia for non-residents investing in residential real-estate. The rules are complex and the details can be found Foreign Investment Review Board
More on Investing in Australia and New Zealand Real Estate: Rules for Non-Residents
CSIRO has just released Fuel for Thought, a report from the cross-sector Future Fuels Forum. Their worst case scenario of petrol at A$8/litre by 2020 has made headlines in Australia.
Even with petrol not yet at $2/litre there is a noticeable increase in deamnd from both buyers and renters for properties which are either within 10km of the city centre or close to suburban public transport, particularly rail. It would appear that the major loosers are the new suburbs 20km plus from the centre with no rail links. These lower-cost suburbs are beginning to make no economic sense if a family needs to run two cars and commute significant distances daily for work and school.
More on $8 Litre Petrol: Implications for Property Investment in Australia
A Private Park Home Village is a very Australian solution to the baby-boomer problem of how to downsize your home to free up the money you need to enjoy your retirement: without actually compromising your lifestyle.
Although some Australians prefer a permanent seachange or treechange others like to become “gray nomads” moving north for the sun during the cooler southern winter. This lifestyle is particularly popular for Tasmanians and Victorians but there are plenty of gray nomads who head north to avoid the winter weather of Perth or Sydney too.
The setup of the gray nomad lifestyle can easily cost $250,000 once a suitable tow vehicle, van and other gear is bought. So the first problem for the aspiring gray nomad is where to find that amount of cash. The other issue is how to lock up and leave your home for 6 months a year, without concerns about security and maintenance.
A Private Park Home Village is a solution for both issues. Residents of these home villages lease their own home and the village provides grounds maintenance and common facilities such as a pool, spa and additional parking for boats and motor homes. The park homes are typically steel framed low maintenance construction and the option is there to either maintain your own garden or have it done for you. These facilities are modeled on the typical Australian holiday park with one important difference: no temporary holiday makers. This means that a Private Home Park has a stable population and good security and also with less noise as most residents are over 40 or 50 years.
The slowing property market in Australia has meant that some real estate agents are finally having to do some work to earn their generous commissions.
The agent’s main problem is of course over-optimistic vendor’s expectations. In the good days of the boom an overpriced house just mean that it might take a month to sell instead of a week. Now with the average number of days to sell at 78 a realistic selling price is the starting point not the ending point.
