April Market Report- Interest Rate move proves ineffective

The Reserve Bank’s decision to drop interest rates by 0.5% had little effect on the Sunshine Coast property market during the month of April. Ray White Maroochydore again nudged over the 12 month average baseline of $7.0m in property sales with 16 properties successfully sold. Owner occupiers again dominated investors out buying them 3 to 1. With investors looking for sharp value, the average gross rental yield of these properties sold was just over 6%; some properties at close to 7%. As the market continues to remain price sensitive, the sub $400,000 price bracket contained almost 50% of the transactions completed.

Buyers are still afforded plenty of choice locally, with over 400 properties available for sale in Maroochydore alone; (excluding surrounding suburbs) there is a genuine over supply. How long will this continue? Interestingly, our agents are reporting a slow down in new stock to the market, should this emerging trend continue then hopefully it will give the buying market time to absorb the oversupply and return stock availability to more rational levels.

The trend of 2012 being higher than average foot traffic at our open for inspections continues to build as most purchasers admit that the current market is more likely to hold steady then continue to soften. Although buyer inspection numbers are on the rise, the average days on market for properties selling with a price (private treaty) continues to hold out over 90 days.

The QLD govt building boost also expired in April. With the deadline looming one of our projects “Emporio” in the Maroochydore CBD benefited with almost a sale a day being completed in the last week of the month- 6 sales in as many days. As the project team, we are almost excited as the stage one owners with completion of stage 1 expected in just over a few months.