With the sale of new Gold Coast apartments having recently doubled, there’s now mounting concern that supply is rapidly dwindling.
New quarterly data from research house Urbis reveals a more than doubling in Gold Coast apartment sales (470) compared with the previous quarter (June).
Most (77%) sales were based around the traditional apartment precincts of Surfers Paradise, Broadbeach and Main Beach.
Much of the rebound in sales is being attributed to cashed-up buyers attracted to larger luxury residences now available on Gold Coast skyline – valued at between $1m and $10m.
According to analysis by Total Property Group (which specialises in luxury apartment sales) 80% of those buying off the plan pay cash.
Interestingly, the proportion of Queenslanders buying new luxury apartments has jumped from 40% to 57% in the last year.
What happened during the September quarter
- 1,770 apartments remain unsold at the end of September – 82% of which are in Surfers Paradise, Main Beach and Broadbeach.
- North Shore, Coastal Fringe, and Southern Beaches Precincts all have limited supply with just 264 apartments remaining for sale across all three precincts.
- Five new projects launched during Q3 2023 – four are in Broadbeach and Main Beach.
Equally noteworthy, during the September quarter there was an ‘about face’ by developers, with three projects originally earmarked for Build to Rent projects switching to selling.
However, curiously one project is flying in the face of unprecedented buyer demand and switching from selling apartments to a Build to Rent project.
Diminishing supply could trigger FOMO buying
But despite the growing appetite by high-net-worth buyers for premium destination offerings, Urbis director Paul Riga suspects the Gold Coast is heading for supply issues unless new projects get underway.
What the data clearly highlights, notes Sydney-based David Highland whose company (of the same name) recently set up an office locally is that demand for the Gold Coast remains solid since new apartment sales peaked at 742 during the first quarter of 2021.
However, like Riga, Highland suspects buyers entering the Gold Coast apartment now, may witness early capital growth upside, especially with the prospect of new supply drying up.
In light of the upward pressure on construction costs, which has resulted in a litany of developers closing their doors, Highland expects to see the continued flight to ‘quality developers’ that can be relied upon to complete projects.
He also suspects that during the peak selling periods for apartments over Christmas/New Year, fear of missing out (FOMO) could result in more buyers wanting to get into the Gold Coast apartment market sooner, resulting in an uptick in third-quarter sales.
Image: James Edition