What does the future hold for Townsville Land Sales with the end of the builders boost
The Townsville Bulletin has reported that whilst the building boost has certainly given the building industry a shot in the arm, the aftermath may be a slowing in building activity.
Local land developers I spoke with in January said that whilst the boost was welcome. sales had been slower than expected, and this is not doubt due to general malaise in the housing market.
Land sales have definitely improved, but this is a far cry from 2006 when I remember clients lining up at the Kalinda Chase Sales Office to secure a block ahead of others due the demand.
It’s a simple fact, that whilst BAnk’s credit policies are tighter, and interest rates still above cyclic lows of the last 10 years, that boosts. grants or any other incentives play an active but only small part in driving a market.
And with established houses retailing at well below 90% of replacement costs, the incentives simply give buyers choice which they must evaluate carefully before committing – there is in many cases better value int he established market at times – and again this a part of the property cycle.
The fact remains – rental demands remain good, interest rates will probably drop again and we do not have an oversupply of land, and with a likelihood of change in the federal government at the next election confidence will slowly return.
And I would imagine the Can Do team in Brisbane may still vote to extend the boost – let’s hope so.
A copy of the article follows :
An influx of last-minute buyers has given Townsville’s building industry a lift as the hours count down to the end of the $10,000 Queensland Government Building Boost.
But while the surge was a welcome relief for many builders, the number of homes being built remains lower than previous years, with some fearing it was a Band-aid solution that failed to get business back on track.
Housing Industry Association regional president and owner of Finlay Constructions Darren Finlay said he noticed a 10 per cent increase in homes being built for the duration of the building boost.
But this figure was still down on previous years, proving more needed to be done, he said.
Mr Finlay feared simply not enough houses were being built, which could cause a shortage in years to come, especially with increased rent prices already causing a financial strain on many households.
The Queensland Building Boost was initially set up in answer to the struggling state of the industry and was set to end on January 31.
It was then extended to April 30 in a bid to lure more buyers.
Mr Finlay said the scheme was initially tipped to attract 14,000 in people in Queensland when it was launched last August, but just 3206 people had taken advantage of the offer by January 1.
“With a new State Government in power it doesn’t look likely that the scheme will be extended beyond this month,” he said.
While the boost did not bring local business back to its former glory, Stockland North Shore project manager Andrew Astorquia said it had sparked a busy start to 2012.
“Because the boost was initially supposed to end in January, we had a very busy month then,” he said.
“We did five times as many sales in that month as we did at the same time last year.”
All in all, Mr Astorquia said, the boost had a positive effect on business, and as a result he expected a bit of a slump to follow this year.
“Interest rates will have an effect, too … if they drop there will be a bit more confidence,” he said.
“But with the building boost ending there will be a bit of a lull.”
Mr Astorquia said last-minute buyers keen to snap up the building boost also needed to remember they couldn’t just waltz in two days before it finished and be eligible for the grant.
He said paperwork and building contracts took about two weeks, so anyone keen to buy should not leave it later than this weekend.
It was for that reason that Stockland launched a double building boost offer – matching the grant dollar for dollar – with an end date of tomorrow.
Graham Lynham