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Paul Markwell from First National Real Estate Gladstone expects the Gladstone property market to strengthen over the remainder of 2011, on the back of a rising market over the first half of the year due to ongoing high demand for residential properties following the commencement of major projects such as LNG projects. “This will create an ideal market for investors, who could capitalise on lower house prices, increasing rents and improved yields,” Mr Markwell said in the First National Property Market Mid Year Update 2011 released this week. Mr Markwell expects property prices across the board (house, apartment/strata and land) are expected to trend upwards by mainly between 5 and 10 per cent ‘A shortage of housing, coupled with the onset of new land developments is keeping the market active,” Mr Markwell said. “However, land developments need to be fast tracked. There is talk by local and state government authorities of around 4,000 lots in planning, but these developments are not in construction phase and so will lead to a stand-still of house construction in the next six to 12 months unless they can be fast-tracked in some way.” Mr Markwell believes the rental market is expected to remain relatively steady with vacancy rates easing and trending upwards, increasing by between 1 and 5 per cent. “A high influx of people coming to Gladstone for work will put upward pressure on rents, which may increase by between 5 and 10 per cent,” Mr Markwell said. According to Mr Markwell, investors are expected to represent the strongest growth in activity, rising by between 5 and 10 per cent as a result of increased confidence in the Gladstone region property market. “Investors will ultimately benefit from increased second buyer activity and improved rental yields and returns,” Mr Markwell said. The Government’s move to introduce a carbon tax is not supported by First National members, primarily as a result of concerns about the impact on

confidence, the economy, saleability of existing housing stock, and, values. “However, more customers will seek energy efficient features when looking to buy a new home, due to the rising household energy costs and the challenge of maintaining a healthy home budget,” Mr Markwell said. “A carbon tax may decrease demand for homes that are not currently adapted for energy efficiency. “Increased council rates, water charges, electricity charges and a carbon tax will all impact on living costs along with ambulance levies on electricity accounts. “Government charges, water and power are up more than 50 per cent in south east Queensland already and predicted to go higher before applying a carbon tax based increase.” Mr Markwell believes Stamp Duty should be abolished altogether, delivering on the promise to remove all indirect taxes such as Stamp Duty, when the GST was introduced as well as stimulating market activity particularly with investors. “But replacing stamp duty with another form of tax, such as a broad-based land tax or death duties is not supported,” Mr Markwell said. “A broad-based land tax including the family home would ultimately become a tax on tenants and it would reduce investor interest in Queensland. “Death duties should also be taken off the negotiating table, and any talk of abolishing negative gearing should cease immediately.” The exclusion of any of these proposed policy changes from the recently announced Queensland state budget may be an indication that the Government does not intend to take such matters any further. Mr Markwell said the lack of State Government action on new land releases is stifling the market. “The land segment is suffering as a result of high development costs,” Mr Markwell said. “The Queensland Government has just put a clamp on head works ($28K per block) but developers say they have not touched the water rates and that adds another $25K on top of that, so effectively it costs around $50K to develop a single block of land which may serve to discourage for investors.” - copy ends – Issued by: First National Real Estate

For further information or to receive a copy of the 2011 Property Outlook, Paul Markwell, Principal from First National Real Estate Gladstone, on 07 4978 7005

Gladstone, QLD  

Gladstone, QLD - Media Release