Mainstream media and social media feeds are full of stories and reports on the Sunshine Coast housing market booming and the rental market going berserk (just as we predicted 10 years ago with our sister brand Investor Property).
There are pros and cons to this current scenario we are operating in depending on your current financial situation.
For those looking for a rental home, the options are minimal, the timeframes for applications super-fast and the costs increasing. For the first time, there are many facing homelessness due to the lack of available housing.
For investors in this market, there’s never been a better time to invest in property with rents rising, property values rising and interest rates super low. More importantly, people are crying out for somewhere to live and investors could be their solution.
While general media reports are an indication of the challenges and gains of the region, we looked to our own data to confirm what we predicted and what we’ve been feeling about this busy period in property.
Based on the properties we (Direct Rentals) advertised for rent so far in 2021 we are averaging around:
- 100 enquiries per property,
- 40 applications to rent per property,
- Creating an effective 0% vacancy rate.
This is the most demand we have seen on the Sunshine Coast, ever.
Rents (less anomalies and new managements) have increased on average >10%pa. and several in very high demand areas have increased 20%. Where media reports an increase in the average rental rate from $450 per week to $500 per week, we’ve already seen our own average rise to $550 per week.
Additionally, with our holiday arm of the Direct Collective, Direct Hotels, we are seeing an over 80% occupancy rate during a traditionally quiet period following the school holidays, with more people turning to short stay letting while they try to find a permanent rental.
We recognise that this is a housing crisis with such an imbalance of supply and demand of property, and the conditions unlikely to improve any time soon.
What’s the answer?
The immediate is about crisis management, about the Sunshine Coast community coming together to provide alternative solutions.
The bigger answer is to come from a mature and robust debate around a medium and longer term solution moving away from extremist views in planning and having a conversation that generates justice and fairness for all.
The planning of this region needs to allow for increasing density and infill development because the time it takes to rollout new green-field sites, even fast tracked, is unlikely to give us any immediate relief.
What we need is the shortening of red tape and realistic practical application of how we maintain our culture and environment while also providing solutions through more dual occupancy arrangements, increased density in appropriate areas and increased building heights in reasonable locations.
More duplexes, triplexes and quadplexes will allow more affordable housing alternatives for both owner occupiers, first home buyers and for those seeking rentals. This will enable more people to live in this community without clearing more land for homes, noting that essentially this land doesn’t exist.
The Sunshine Coast already has a shortage of hospitality staff but is experiencing incredible demand from tourists despite the restriction on international and some domestic travel. In order to enable the economy to thrive and to service the amount of residents and tourists already here and planning to come, more hospitality (and other) staff are required but there’s little choice of affordable accommodation for them to live.
This isn’t about rich investors, developers, councils etc those who come and those who should and those who shouldn’t. It’s about us being a community, seeking justice, fairness and the equality of right to live how and where our community and culture supports for everyone according to their affordability to support a thriving and vibrant Sunshine Coast that we are renown for and seek to protect. Protection is not tantamount to ‘no change’.
We need some sound, reasonable, wise discussion. It’s not about rallying the troops it’s about people.
What is happening here is a 5-10 year challenge and for investors that’s a massive opportunity to build wealth and be part of the solution for the community. On Sunshine Coast there is no short or medium term solution – it’s likely to be exacerbated. Save for a highly unlikely, immediate curbing of growth or planning and red tape changes, we can’t even see a change in medium term.
This is a historical event, it’s not a ‘boom’ in the traditional sense. This isn’t a ‘peak’ with a large downturn in the near future. This is the beginning of the future of the Sunshine Coast, a protracted upswing, and investors are the solution.