Newspaper article Sunshine Coast Daily (Maroochydore, Australia)

The Cloud with a Silver Lining

Newspaper article Sunshine Coast Daily (Maroochydore, Australia)

The Cloud with a Silver Lining

Article excerpt

THE sun will come out from behind the dark clouds next year and in 2010 it will really start to shine on the property market.

That was the message property analyst Michael Matusik delivered to the Urban Development Institute of Australia (UDIA) Sunshine Coast branch annual general meeting.

The fundamentals for Queensland remain strong despite economic downturns throughout the world, Mr Matusik said. Population growth is strong and heading upwards. Price growth is expected to head up. Not a lot - but it will be a sharp V turn upwards, not a U turn and certainly not a W...

In most states the unemployment rate is about 4% and the shortage of new dwellings is likely to continue for the next decade.

Mr Matusik said Australia's economic position was good - the government could still afford further drops in interest rates and deliver economic packages to stimulate the economy.

"Unemployment is low. In reality full employment is 5.5% and that's where we are predicted to be heading.

"Other assets are more volatile than property, which has performed well in the long term."

Mr Matusik said Australia's population growth is the strongest on record - 337,000per annum with the Sunshine Coast growing by 8000.

While that population growth may be down on the 10,000p.a. five years ago the decline was in line with less migration into Queensland and the fact that infrastructure needed to catch up.

Residential returns for the past 12 months on the Sunshine Coast rose 11.8%, vacancy rates are tight and the under-supply of homes continues to worsen despite the increased First Home Buyers Grant.

A problem facing the Sunshine Coast, Mr Matusik said, was a push towards urban consolidation. This was despite the fact that some 50% of the population growth was expected to be less than 35 years of age.

"Most have kids and work in the trades so they cannot afford to. They need the space. We have to provide more developments on the fringes."

Claims of 800,000-plus Australians being under mortgage stress are wrong, Mr Matusik said.

"Only 0.41% of mortgages are in arrears by three months. …

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