Despite the realities of the GFC, the end user apartment market seems to be holding its own.
Particularly, residential-use as opposed to mixed-use developments located on the waterfront are a rarity these days, hence why high demand is apparent. The allure of quiet enjoyment and ownership to a rare product in this type of market and location is a huge attraction – not only in terms of lifestyle, but also in terms of capital gains.
Take Broadbeach for example: only 26 out of 146 beachfront apartments remain for sale targeting end users in one of Gold Coast’s most tightly held markets.
Chris Litfin, Managing Director of project marketing for CB Richard Ellis Gold Coast comments: “The beachfront market is a very small sector of the overall apartment market in Broadbeach but it continues to attract strong interest just for what it is – a beachfront apartment for residents.”
“Other areas of the property market have struggled in these times, such as apartments offering holiday letting.”
“But there is always inquiry from people who want to live on the beach in resident only developments and the small number of available apartments to meet their criteria is keeping both sales and prices stable.”
It’s a simple under-supply and over-demand equation for residential-only beachfront apartments in Broadbeach. Only 100 apartments of this type have been developed in the last decade, of which 50 have traded at an average price of $2 million in the past five years.
Developments include Amalgamated Property Group’s (APG) Verve, and $88 Million Eclipse which is currently under construction, and has achieved 27 sales averaging $1.5 million in price. Additional developments include Juniper’s Waterline, and Howard Group’s Vogue on Broadbeach. That’s right, there are only 4!
“Buyers are getting tremendous value in this type of stock because of the economic environment – five years ago you would be lucky to get into a beachfront apartment targeting end users for under $2 million and now it is possible for around the $1m mark.”
“Beachfront apartments targeting end users will always attract a higher premium than a few blocks back from the beach in holiday let apartments.” Hence, prices have remained constant for market-focused products such as these previously listed, when in other cases holiday let apartments, prices have dipped.
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