New trend in home ownership across the Sunshine Coast

Pandemic buyers refining their choices and opportunists making the most of capital gains are thought to be mainly responsible for an increased proportion of Sunshine Coast and Noosa homes changing hands relatively quickly.

CoreLogic data shows the proportion of homes resold in less than three years in the Noosa and Sunshine Coast council areas began trending upward in the pandemic, rising markedly from 2021 into 2023 although tapering off a little more recently.

 

In Noosa, 22.4 per cent of resales have been properties held for less than three years, while the corresponding figure on the Sunshine Coast was 23.8 per cent.

The Sunshine Coast and Noosa percentages are significantly higher than the 15.8 per cent of national resales occurring in less than three years.

Real Estate Institute of Queensland Sunshine Coast zone chairman Matt Diesel said properties normally turned over once every seven to 10 years.

Mr Diesel put the increase in quick turnovers down to people who had bought under pressure during the pandemic looking to relocate to more suitable properties.

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“We saw a lot of people in that time go through and buy properties that weren’t quite right for them. Because of the lack of options that were there, the properties were the best of the mix for them at the time,” he said.

“It was, ‘We’ll take it for now and once everything calms down, we’ll look for something else we want.’

“We’re seeing these people now. They’ve worked out where they want to be, or what school catchments they want to be in.

“(Or) they’re downsizing or right-sizing to get into something more appropriate.”

Mr Diesel said it had not only been interstate buyers but also local sellers buying into the same market who had settled for properties that were not ideal so they had a roof over their heads.

He said the tight rental market had meant they had not had the opportunity to rent while they waited for the perfect property during the pandemic.

Most of the short-term sellers were simply wanting to get into homes that better suited their needs and lifestyles, he said.

“We’re seeing a lot more come to market in the short-term but this is really because people were taking what they could get with the thought of moving later on,” he said.

CoreLogic research director Tim Lawless said it was not surprising that a high proportion of homes were sold within two years of ownership during the pandemic, given a 61 per cent surge in Sunshine Coast property values between 2020 and 2022.

“Presumably such a rapid rate of capital gain was a key reason for homeowners ‘cashing out’ after such as short period of time,” he said.

 

 

Jon Colley, a lending specialist at Loan Wize, said there was a cohort of buyers who had bought into the market, sometimes with first home buyer’s grants, who had since sold to collect the capital gain.

“There’s people that borrowed three to four years ago who have got out with $300,000. If they bought at $550,000, now they can get $850,000,” Mr Colley said.

“They’ve done it as a short-term measure. I don’t really see those sales as being a sign of distress as the people have taken advantage of the opportunity that was in front of them.”

Mr Colley said buying with a view to selling in the short-term to take advantage of capital gain was one of the creative strategies people were using to work their way towards owning their own homes.

Mr Lawless said he could see interstate migrants returning home as another reason for homes in the region selling within a relatively short time frame since pandemic restrictions eased.

“Migration to regional Australia was significant during the pandemic, with more people leaving the capitals for the regions and fewer people leaving the regions for the capital cities,” Mr Lawless said.

“With the worst of the pandemic behind us, we are seeing a normalisation in the demographic trends.

“No doubt there will be a portion of recent buyers who are choosing to move back to the cities due to work or lifestyle preferences.”

Mr Lawless and Mr Diesel both acknowledged that some of the sales of properties that had been held for a short-time could be due to mortgage distress.

“There could also be an element of motivated selling in these numbers, where recent home buyers have found their balance sheets stretched amid high interest rates and high cost of living pressures,” Mr Lawless said.

Mr Diesel forecast that buying in the region was likely to become more competitive over the coming months as southern and New Zealand vendors took advantage of spring to take their properties to market, some with a view to moving to the Sunshine Coast and Noosa.

“And they’ll all want the same thing. They’ll all want to be settled in their new homes for the beginning of the school year,” he said.