Gold Coast booms – Diaswati Mardiasmo

An event such as the Commonwealth Games, to be held on the Gold Coast in 2018, leaves a legacy.   Hear how much the Games will improve the market there and for how long.  We discuss the report with its author – Dr Diaswati Mardiasmo.
Kevin:   I mentioned at the start of the show, interesting to have a look at what’s happening on the Gold Coast. The Gold Coast has been one of those markets we’ve been watching, particularly with the Commonwealth Games coming up.
A new report from PRDnationwide has shown that there is a great legacy. New data predicts that the Gold Coast residential property market will grow at a higher rate than was experienced following the Melbourne Commonwealth Games.
To get a bit of a feel for what the growth was like in those capital cities, I’m joined now by the research manager for PRDnationwide, Diaswati Mardiasmo.
Diaswati:  Hi. Good morning.
Kevin:  Tell me about the Gold Coast. Interesting that you’ve done that comparison between the Gold Coast and what happened in Melbourne. What have you actually found out, and how long will that flow-on effect last?
Diaswati:  The reason why we did a comparison to not only the Melbourne Commonwealth Games but also the Sydney Olympics back in 2000 is because we really wanted to base our data on those case studies to see what actually happened in those places after they’ve hosted an international sporting event. Back then, we made sure that when we looked at past case studies, we didn’t just look at Melbourne or Sydney; we actually looked at the area in which those games were held.
For the Melbourne Commonwealth Games, it was held around the Parkville area, so we looked at data from that particular area. We saw that in 2005, prior to the Games, the annual median price growth was 6.2%, but on the year of the Games and the year after, it increased by 11.4%, and then it continued to grow for the next 24 months, so that’s almost doubled. Sales transactions actually increased by 33% between 2006 and 2007. That’s a year after the Games.
Kevin:  Have you been able to identify the suburbs that you believe will get the greatest growth, and is it because they are close to those new facilities that are being built?
Diaswati:  The effects of the Gold Coast Commonwealth Games will be seen all around the Gold Coast, but you are correct, there are certain suburbs that have been star performers, I would say, or the ones that have had that real flow-on, positive effect. You’re looking at places like Ashmore, Carrara, Coomera, Oxenford, and Southport, because this is where most of the Commonwealth Games-related infrastructure or new buildings or new stadiums are being developed at the moment.
Kevin:  Diaswati, what are you predicting in those areas in terms of what the growth could be compared to what it has been?
Diaswati:  We’ve done this report for three consecutive years. The first one back in 2015, the median growth in places like Ashmore and Southport and Carrara, for example, were only around 3%, 4%, maybe 4.5%, and now, Ashmore is at 12.6% for houses, Carrara is at 11.3%, and also Southport is at 6.6%. So over the past couple of years, we’re seeing these places grow from that 3% to 4% growth to almost double, and particularly so in Ashmore.
We’re really predicting – based on the case studies that we’ve done in Melbourne and Sydney – that there will be more onset growth not only when the Games happen but also after the Games.
Kevin:  That’s an interesting point. We’re building up to the Games now, and it’s likely to go for a couple of years after that. Do you think that the increases that we’re going to see on the Gold Coast will be greater than those we saw, say, in Melbourne?
Diaswati:  In a way, I would say so, and the reason for that is because we’re in a place at the moment where the property prices and the property market is hotter than back then. We’re talking about 2005, 2006, and 2007, whereas now at the moment, we all know that the property market is way hotter. We are getting more sales and interstate migration and also people buying from Sydney and Melbourne because the Gold Coast is more affordable than, say, Bondi or Brighton. We’re also getting a lot of the tourists and the Chinese buyers playing in the market as well.
The current market conditions are very, very supportive of the Gold Coast performing better after the Commonwealth Games than Melbourne and Sydney when they held their Games.
Kevin:  Diaswati, thank you very much for your time.
Diaswati:  No worries. Thank you so much, Kevin.

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