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Second Quarter │2014

GLADSTONE REGION Highlight Report®

GLADSTONE REGION OVERVIEW The Gladstone Region Highlight Report analyses the performance of the residential real estate market within the Gladstone Local Government Area (LGA). This report also contains detailed investigations regarding three sub-markets inside the Gladstone LGA the areas of Agnes Water, Gladstone City and Tannum Sands.

Overview

The Gladstone LGA is located around 550 kilometres north of Brisbane, situated between Rockhampton and Bundaberg. Figures published by the State Government has highlighted Gladstone as one of the fastest growing LGAs in Queensland, with an estimated resident population of 63,955 as at June 2013. This region is a major industrial hub and home to Queensland’s largest multi-commodity port, found on the periphery of the Gladstone City Area. Additional core infrastructure includes the Gladstone Airport, a nexus of rail lines and highways, refineries and various other production facilities and industrial titles that underpin the region as being one of the most important resource service centres in Australia.

GLADSTONE LGA HOUSE & LAND SALES CYCLE House Sales

Heading  Estimated

$400,000

1,000 $300,000 800 $203,000

600

Median sale price

$425,000

1,200

$200,000

400 $100,000 200

2013 JUL

2014 JAN

2012 JUL

2013 JAN

2011 JUL

2012 JAN

2010 JUL

2011 JAN

2009 JUL

2010 JAN

2008 JUL

2009 JAN

2007 JUL

2008 JAN

$0 2006 JUL

0 2007 JAN

The region’s rental market had also experienced high demand, with low vacancy rates and high median rents, however has since declined.

$500,000 1,400

2005 JUL

Gladstone LGA’s median house price reached a high of $475,000 in the six months to Jan 2012, with sales activity also peaking during this period.

Land Median $600,000

2006 JAN

House Median

1,600

Number of sales

resident population has since grown at an average annual rate of 3.9 per cent since June 2010. Nonresident population has also increased due to related fly-in/fly-out, drivein/drive-out (FIFO, DIDO) workforces.

Land Sales

1,800

2004 JUL

Resource-based construction that has commenced in recent years includes three liquified natural gas (LNG) projects, new port and rail projects and associated infrastructure, boosting the local and state economy.

2005 JAN

Since 2010, the Gladstone LGA has seen the construction of many significant resource-related projects, which has in turn has resulted in a considerable increase in population and residential property demand. More recently, as these construction projects near completion, demand has weakened and presents the region with some tough challenges.

2004 JAN

GLADSTONE LGA HIGHLIGHTS

Half year period

PRDnationwide does not give any warranty in relation to the accuracy of the information contained in this report. If you intend to rely upon the information contained herein, you must take note that the information, figures and projections have been provided by various sources and have not been verified by us. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. PRDnationwide will not be liable for any loss or damage resulting from any statement, figure, calculation or any other information that you rely upon that is contained in the material. Prepared by PRDnationwide Research © All medians and volumes are calculated by PRDnationwide Research. Use with written permission only. All other responsibilities disclaimed. © 2014


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2012 MAR QTR

Heading

1 Bed Flat

$250 $260 $360 $400

2 Bed Flat

$300 $450 $490 $380

2 Bed House

$420 $380 $300

3 Bed House

$480 $480 $350 $650 $625 $430 $350 $405 $350

$560 $550 $700

$600

$500

$400

$300

$200

$100

$400

$0

local residential market. The Gladstone Region patiently awaits a new round of resource-based construction, including a fourth LNG plant, which it hopes translates into more permanent residents and a more stable property market. Also, softening market conditions has opened up a window of opportunity to buyers priced out of the market previously, due to improved affordability.

2014 MAR QTR

$180

3 Bed Flat

Overview This however doesn’t entirely mean doom and gloom for the

Despite current market conditions, the relaxed lifestyle and diversity in property for sale make the region an ideal place to purchase. Whether one is looking for ocean views, a large acreage lot, land to build or an established home close to amenities, the Gladstone Region has property to cater to all needs and budgets.

2013 MAR QTR

3 Bed 2 Bed 4 Bed T'House T'House House

A once significant investor presence, driven previously by the promise of high rental yields, is now a shell of its former self. The unfortunate delay in new rentals coming on to the market and the increasing presence of worker’s camps has seen vacancy rates go from very low to high levels and median rents fall. The weekly median rent for three bedroom houses in the region now stands $350, down $150 from the year prior.

GLADSTONE LGA WEEKLY MEDIAN RENTS

Property type

As current major projects shift from a construction to production phase, and the slowdown in the mining industry continues, the Gladstone Region property market has had to adjust accordingly. Median prices and sales activity have been in steady decline since the end of 2012, after prior increases that were arguably unsustainable. The median house price in the Gladstone LGA was recorded at $425,000 in the six months to Jan 2014, after reaching a high of $475,000 during same period in 2012. Unit and vacant land median prices have also fallen markedly, as has overall sales activity.

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Median rent

GLADSTONE LGA MAJOR PROJECTS Completed/Near Completion      

Port of Gladstone Expansion Australian Pacific LNG plant and associated pipelines (APLNG) Santos Gladstone LNG plant and associated pipelines (GLNG) Queensland Curtis LNG Plant and associated pipelines (QCLNG) Yarwun Alumina Refinery Expansion Wiggins Island Coal Export Terminal Expansion Stage 1

Pending Approval/Financing     

Arrow Energy LNG plant and associated pipeline projects Wiggins Island Coal Export Terminal Expansion Stage 2 Gladstone Pacific Nickel Project Gladstone Steel Making Facility Yarwun Coal Terminal

PRDnationwide does not give any warranty in relation to the accuracy of the information contained in this report. If you intend to rely upon the information contained herein, you must take note that the information, figures and projections have been provided by various sources and have not been verified by us. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. PRDnationwide will not be liable for any loss or damage resulting from any statement, figure, calculation or any other information that you rely upon that is contained in the material. Prepared by PRDnationwide Research © All medians and volumes are calculated by PRDnationwide Research. Use with written permission only. All other responsibilities disclaimed. © 2014


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AGNES WATER AREA

HOUSE PRICE POINTS 2012 JAN At least $550,000

13%

3%

$400,000 to $449,999 $350,000 to $399,999

12%

16%

28%

20%

16%

40%

11%

15%

60%

Less than 1 acre

19%

80%

100%

Greater than 1 acre

Proportion of total land sales

90%

80%

70%

60%

50%

40%

30%

20%

10%

0% 2010 JUL

2011 JAN

2011 JUL

2012 JAN

2012 JUL

2013 JAN

2013 JUL

2014 JAN

Half year period

AGNES WATER AREA HOUSE & LAND SALES CYCLE House Median

19%

100%

2010 JAN

Land Sales

10%

14%

HOUSE & VACANT LAND SALES SIZE

While listings are temporarily subdued, a significant new land release is set to increase supply later in 2014, with future residents to be serviced well by the newly constructed Agnes Waters High School and FoodWorks Supermarket. Residential development activity is also expected to pick up during the year.

House Sales

8%

Proportion of total sales

This change is reflected in the median house price for the half year to Jan 2014, down to $410,000, as the these new buyers have actively sought out properties in more affordable price points. Looking at the House and Vacant Land Sales Size chart we see that acreage properties can account for between 40 to 70 per cent of total sales. Median vacant land prices have remained stable despite such variety in lot sizes, now at $197,500.

Heading

17%

10%

16%

6%

11%

15%

18%

0%

8%

8%

10%

13%

2014 JAN 22%

13%

13%

19%

Less than $300,000

2013 JUL 27%

6%

14%

6%

$300,000 to $349,999

2013 JAN

29%

19%

$450,000 to $499,999

Sales activity in recent periods has tapered off following a surge in demand on the back of resource-related construction work. Anecdotal evidence suggests the type of buyer in the last 12 months has changed from resource workers back towards “lifestyle sea changers” from interstate and first home buyers. Overview

2012 JUL

20%

$500,000 to $549,999

Price point

The Agnes Water Area includes the suburbs of Agnes Water, Seventeen Seventy, Round Hill and Captain Creek. The median house price for the area has experienced short term fluctuations over the past ten years, due to varying degrees of demand and supply influenced by resource projects, however has seen a healthy annual average increase of 3.9 per cent since 2004.

VACANT LAND PRICE POINTS

Land Median

250

$500,000

2012 JAN

2012 JUL

2013 JAN

2013 JUL

2014 JAN

$450,000

At least $260,000

$410,000

$400,000

150

$300,000 $250,000

100

$200,000 $197,500

$150,000 50

$100,000

$240,000 to $259,999

Price point

Number of sales

$350,000

Median sale price

200

17%

14%

4%

$220,000 to $239,999

22%

6%

12%

6%

$200,000 to $219,999

8%

10%

$180,000 to $199,999

15%

27%

$160,000 to $179,999

17%

25%

6%

8%

21%

0%

7%

11%

14%

6%

14%

4%

7%

25%

18%

21%

17%

14%

4%

$50,000

Half year period

2013 JUL

2014 JAN

2012 JUL

2013 JAN

2011 JUL

2012 JAN

2010 JUL

2011 JAN

2009 JUL

2010 JAN

2008 JUL

2009 JAN

2007 JUL

2008 JAN

2006 JUL

2007 JAN

2005 JUL

2006 JAN

2004 JUL

2005 JAN

$0 2004 JAN

0

$140,000 to $159,999

17%

Less than $140,000

10%

0%

10%

17%

8%

20%

14%

11%

40%

60%

18%

7%

80%

7%

100%

Proportion of total sales

PRDnationwide does not give any warranty in relation to the accuracy of the information contained in this report. If you intend to rely upon the information contained herein, you must take note that the information, figures and projections have been provided by various sources and have not been verified by us. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. PRDnationwide will not be liable for any loss or damage resulting from any statement, figure, calculation or any other information that you rely upon that is contained in the material. Prepared by PRDnationwide Research © All medians and volumes are calculated by PRDnationwide Research. Use with written permission only. All other responsibilities disclaimed. © 2014


Research & Consultancy Adding Value to your Investment

About PRDnationwide Research PRDnationwide’s research division provides reliable, unbiased, and authoritative property research and consultancy to clients in metro and regional locations across Australia. Our extensive research capability and specialised approach ensures our clients can make the most informed and financially sounds decisions about residential and commercial properties.

Our Knowledge Access to accurate and objective research is the foundation of all good property decisions. As the first and only truly knowledge based property services company, PRDnationwide shares experience and knowledge to deliver innovative and effective solutions to our clients. We have a unique approach that integrates people, experience, systems and technology to create meaningful business connections We focus on understanding new issues impacting the property industry; such as the environment and sustainability, the economy, demographic and psychographic shifts, commercial and residential design; and forecast future implications around such issues based on historical data and fact.

Our Services PRDnationwide provides a full range of property research services across all sectors and markets within Australia. We have the ability and systems to monitor market movements, demographic changes and property trends. We use our knowledge of market sizes, price structure and buyer profiles to identify opportunities for clients and provide market knowledge that is unbiased, thorough and reliable.

Our services include: •

Advisory and consultancy

Our research team is made up of highly qualified researchers who focus solely on property analysis.

Market Analysis including profiling and trends

Primary qualitative and quantitative research

Skilled in deriving macro and micro quantitative information from multiple credible sources, we partner with clients to provide strategic advice and direction regarding property and market performance. We have the added advantage of sourcing valuable and factual qualitative market research in order to ensure our solutions are the most well considered and financially viable .

Demographic and target market analysis

Geographic information mapping

Project Analysis including product and pricing

Our experts are highly sought after consultants for both corporate and government bodies and their advice has helped steer the direction of a number of property developments and secured successful outcomes for our clients.

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recommendations •

Rental and investment return analysis

Competitive project activity analysis

Economic indicators

Social research, including focus groups


Prepared by PRDnationwide National Franchise Services. For further details contact: Tim Lawry Principal PRDnationwide Agnes Water P: (07) 4974 9470 E: tim@prd1770.com.au James White Principal PRDnationwide Agnes Water P: (07) 4974 9470 E: james@prd1770.com.au Ryan Connors Research Analyst PRDnationwide Research P: (07) 3229 3357 E: ryanconnors@prd.com.au

Gladstone Region Highlight Report 2014 Q2 (agnes water)