CQ property market is stabilising to pre-mining boom levels

THE property market throughout Central Queensland is stabilising with sales volumes and prices returning to pre-mining boom levels.

The boom triggered significant price rises in housing and apartments throughout the region, including out west to the mining towns of Moranbah, Emerald, Dysart and Blackwater.

The economies of these towns have struggled since the boom ended about 2012, with rising unemployment and limited opportunities for economic diversification.

However, for Mackay, Rockhampton and Gladstone, traditional economic bulwarks of tourism, sugar, beef, export and education are helping to stabilise the economy.

Many experienced property observers agree, property sales volumes and values are now finding their new normal.

Mackay has fared the worst of the three major centres, with the annual median sale price continuing to sink, now sitting at $365,000, down 10.1% on a year ago and 8.8% lower than five years ago.

Even though Rockhampton has a lower median house price, now sitting at $294,500, it’s only 5.4% below a year ago, and down just 1.8% on five years ago.

This indicates a more stable market and the REIQ is confident that the bottom has been reached.


Bargain Isaac Plains coal mine returns with 150 jobs

A MORANBAH coal mine bought for $1 earlier this year will soon provide job opportunities for 150 local workers.

Isaac Regional Council Mayor Anne Baker said she met with Isaac Plains coal mine owner Stanmore Coal on Tuesday when they announced a scheduled opening in February 2016.

While she would not say if the mine had totally ruled out all elements of a fly-in, fly-out workforce, she was given “absolute confidence local people will be able to apply and work there”.

“It’s going to be open to everyone,” Cr Baker said.

“They never mentioned FIFO. There are 150 positions and everyone is welcome to apply.”

The mayor hailed the project, 6km east of Moranbah, as a boost for industry, local workers and the community.

Moranbah Bakery owner Steve Hanvey said if local workers really were prioritised for the jobs the project would be a “beaut thing for the town”.

“My partner was doing deliveries the other day and at the petrol station she saw five families packed up to leave town,” Mr Hanvey said.

“We need support and we’ve had a lot of doom and gloom for a long time.

“I have all 10 of my fingers crossed and my arms crossed that these jobs will go ahead and there will be more to come.”

The Moranbah resident of 24 years said it wouldn’t just be the workers who benefited but the whole community.

The mine was open-cut and Cr Baker said “real time air quality monitoring” would be in place for Moranbah residents.

Stanmore Coal bought Isaac Plains Mine from Vale and Sumitomo in July for $1, more than a year after about 300 jobs were lost when production halted in 2014.

After a program of exploration and refurbishment, Stanmore Coal will begin mining activities following government approvals.


Mackay : The Queensland city tipped best place to buy a home

Mackay has been tipped as the best spot to buy a house in Queensland say property leaders as the beachside city shows signs of rising from the bottom of the property cycle.

LJ Hooker principal Brett Greensill said Mackay’s property cycle was clearly on the rise after a downturn, making it the ideal time for buyers.

“House prices in Mackay have come down in recent years and have now stabilised at the bottom of the market, with great potential to start to rise in the near future,” Mr Greensill said.

“I advise home buyers to look for regions that are just rising from the bottom of the cycle, and Mackay is definitely in that position at the moment.

“The housing affordability in Mackay coupled with the current record low interest rates makes for perfect buying.”

He said the recent mining downturn which saw masses of job losses in the region and spikes in vacancy rates, was not a cause for concern.

“The mining downturn has downturned,” Mr Greensill said. “And the mining sector has stabilised.”

Mackay Professionals principal Trevor Chapman said buyers were already taking advantage of Mackay’s bottomed out market.

“The bottom price is really hot at the moment – and it’s always the bottom of the market that moves first; we’re seeing that happen already in Mackay,” Mr Chapman said.

He said the bottom of the market is sitting at around $200,000, but it will not last long.

“All of my low stock is going, and it’s all from local buyers,” he said.

He said investors, however, have not appeared to catch on.

“Investors should be here already,” he said.

“We’re going to see them come in once the prices show signs of rising.”

Current high vacancy rates in Mackay could be a factor in why investors have been reluctant to enter the market.

Mackay’s Gardian real estate principal Eric Rickman said 20 to 30 per cent of buyers are coming from the south east corner of the state, which were mostly owner occupiers.

“Maybe the high vacancy rates are worrying investors – but we do have buyers from the south, they just aren’t all investors,” he said.

He said November was his best month for sales to date.

“In November we experienced our best month since we opened two and a half years ago,” Mr Rickman said.

“The market is on the up.”

Investors should approach mining town’s ‘recovery’ with caution

Investors are being warned to proceed with care after a new report claimed the property market in one of Australia’s most prominent mining towns had turned a corner.

Mackay’s real estate market is showing signs of recovery following its dramatic downturn, according to a recent report from the Real Estate Institute of Queensland (REIQ), but investors are being advised to treat the news with caution.

Real estate agents are fielding an increasing number of enquiries from local buyers, according to the report, leading to speculation by the REIQ that the market has reached a turning point.

Mackay has suffered greatly since the downturn in commodity-related exports.

Only in June the area was named by CoreLogic RP Data’s Pain and Gain report as the biggest loss-making real estate market in the country, with 45.5 per cent of sales resulting in a loss.

The current median house price in Mackay is $340,000 – a 15 per cent decline over the past 12 months – according to CoreLogic RP Data.

But the REIQ report argues that record-low interest rates, combined with cheap housing stock, is driving a new wave of first home buyer activity in the area.

Peter McFarlane, REIQ zone chairman for the Mackay district, argues that this represents the first signs of a turnaround for the region.

“There has been a distinct improvement in the Mackay property market in 2015,” Mr McFarlane said.

“More first home buyers are taking advantage of the low interest rates and the affordable property prices to realise their dream of owning their own home,” he said.

Future price growth in the region is likely to be more sustainable as the market adapts and becomes driven by local owners rather than interstate investors, according to Mr McFarlane.

“Mackay has been re-established as a true local buyers’ market in the post-global financial crisis era of adjustment and renewed gradual growth,” he said.

“As a result, market conditions have stabilised and confidence is increasing in the local property market and the broader local economy.”

He explained that moves to diversify Mackay’s local economy had led to a renewed optimism over the area’s prospects.

“Local government initiatives to broaden diversification of industry and facilitate development in the region have put Mackay on an economic development growth path in 2015, leading to a general feeling of optimism throughout the region.

“As outlined in the latest REIQ report, this positivity has now been reflected by the increased level of local buyers interested in investing in the property market,” he said.

But Ben Kingsley, CEO of Empower Wealth Advisory, cautioned investors to hold back on any entry into the Mackay market for the time being, stating that mining towns across the country have yet to see the worst of the downturn.

“In regards to mining towns, I would still be cautious before jumping in. I don’t think we’ve seen the bottom yet – we’re still seeing finalisations of capital expenditure and still some finishing off of expansions of some of the mines,” he said.

“So I suspect we’re going to see less rental demand than we’ve seen. That will obviously mean that as these construction jobs further decline, we’ll still see a bit of vacancy and so there will be very little appetite or demand, which will affect prices.”

But Mackay may be in a better position than most once the recovery does commence, according to Mr Kingsley, owing to its attempts at economic diversification and location.

“It’s too early yet. I’d definitely say that Mackay as a township has got lifestyle appeal, it’s next to the Whitsundays, so from that point of view it has got a little bit more of a diversified economy. I suspect that you’ll start to see more focus on other agricultural assets as growth drivers for the township,” he said.

Even so, not enough signs exist of the Mackay market entering a clear recovery phase for any confident investment decisions to be made, Mr Kingsley advised.

“I wouldn’t be jumping in just yet. I’d probably give it another 18 months to two years before I’d really want to see the bottom [and] the signs of picking the bottom are near on impossible,” he added.

“I’d prefer to see some uplift [rather] than some bottoming out. That’s probably my tip for most of those mining towns. I don’t want to be the trailblazer. I’m happy for others to trailblaze and then once I know the foundations are good, then it’s time to start.”

It’s a sentiment echoed by Philippe Brach, CEO of Multifocus Properties and Finance.

He believes that any recovery in the region will be led by a resurgence in iron ore prices – a distant prospect at this point in time.

“As much as I’m convinced that Mackay will pick up again, I can’t see any points at this point in time. Mackay will start picking up when the iron ore prices start picking up […] until they start moving I think the whole mining town real estate [sector] will remain subdued for sure. So I’m not sure where the REIQ has come up with a recovery in Mackay, because there’s no fundamentals for that at this stage,” he said.

In January this year, Trinity Property Consultants and the REIQ predicted that the Mackay property market would bounce back in 2015, claiming the region was set to become the “engine room for the Queensland economy”.

Source: http://www.smartpropertyinvestment.com.au/news/14687-mining-towns-recovery-in-doubt

Fly-in, fly-out review to meet leaders in Mackay, Moranbah

A second review into fly-in, fly-out (FIFO) work practices in the mining industry will hold hearings in central Queensland this week.

Isaac regional council Mayor Anne Baker is part of a four-member panel looking at the use of the practice for mines which are located near a town.

The panel has already done interviews in Brisbane and will meet local representatives from councils, unions and businesses in Mackay today, and in Moranbah tomorrow.

Councillor Baker said so far the talks had been “robust”.

“What I can say is they have all been very open and there’s lots of information and we need to take all of the information on board and not pre-empt or form any position before we’ve got everything and we’ve met with all stakeholders and make an informed decision at the end,” she said.

Cr Baker said the discussions had been open and informative.

“From my perspective it’s very healthy for people to have different opinions and it’s just as healthy to be able to air those opinions and work towards formalising a healthy recommendation for everybody,” she said.

By Melissa Maddison

Mackay Mining town ‘recovering’

Despite continuing reports that mining town property markets are declining, a number of stakeholders are claiming Queensland’s Mackay has turned a corner and is experiencing a “surge”.

On the back of a report by the Real Estate Institute of Queensland (REIQ), issued on 9 March 2015, Total Property Group has claimed that confidence is returning to the mining town market. Total Property Group managing director Adrian Parsons said this was reflected in rising interest in the group’s new master-planned estate, Somerset Park, located in Andergrove, Mackay.

The group cited various sections of the REIQ’s December Quarter 2014 Queensland Market Monitor report to illustrate that “Mackay has moved past the bottom of the housing market cycle towards recovery”.

“The report states Mackay has turned a corner since the beginning of 2015 on the back of improved local confidence, with multiple applications received for rental listings and multiple offers on sales,” Total Property Group said in a statement.

REIQ zone chairman for the Mackay district Peter McFarlane added that he had seen a distinct improvement in the local market in 2015. He attributed the positive progress to increased confidence in employment, record-low interest rates and improved housing affordability.

“We have the lowest interest rates Australia has ever seen and the housing affordability of three to four years ago,” he said.

“Employment in the Bowen Basin mining sector is more secure as it moves from the construction phase to production phase, and we are seeing coal production increasing.

“We are now exporting more coal off the coast of Mackay, and overall there is a growing level of confidence in the region.”

Mr McFarlane said these factors have led to more activity in the sales arena and a boost to the rental market.

“We are seeing first home buyers purchasing existing houses in the $350,000 to $400,000 bracket and the sellers of those homes upgrading to other properties and creating a secondary buying market in the $500,000-plus bracket.”

Mr McFarlane said even though rental vacancy rates were at 10.3 per cent in December, he expects “they will be significantly down at the end of the first quarter of 2015”.

Somerset Park developer Jim Relph of Trinity Property Consultants said Mackay would continue to benefit from the mining sector.

“Mining employment is secure in the Bowen Basin and major mining developments in the Galilee Basin have received the support of new Queensland premier Annastacia Palaszczuk.

“The Queensland Labor government announced an agreement with Adani and GVK Hancock regarding a proposal for expansion of the Abbot Point Coal Terminal – an important step towards putting necessary infrastructure for these mines in place,” the premier said.

“Queensland Resources Council data shows a spike in coal exports in 2014, reaffirming the importance of the coal industry to Mackay’s strong economic future.

“Mackay is also gateway to the Whitsundays, offering a desirable lifestyle and beautiful coastal and rainforest hinterland environments.”

Forum backs call for ‘no more 100% FIFO’ into mines

IT’S about the people, the small mining communities, their struggling small businesses and the impact 100% FIFO is having on them and regional cities like Mackay.

Mirani MP Jim Pearce, as the new chairman of the State Government’s infrastructure, planning and natural resources committee that will begin investigating the issue, took strong interest in yesterday’s CFMEU Mackay forum to discuss the impact of mining companies operating 100% FIFO.

“It’s a privilege for mining companies to come in. It’s not a right. It’s about maximising returns and employment to the communities,” Mr Pearce said.

“In recent years mining companies simply put their head down and ignored the impacts they are having on local communities.

“I’ve been in the region over 30 years and never seen the regions in such a big mess, their communities. Collinsville is on its knees; Dysart, Moranbah in a terrible state. There are 3000 empty house across the Bowen Basin. Money people have invested and gone broke.”

Following the forum CFMEU Mining and Energy Queensland president Steve Smyth said there was “broad agreement” that: compulsory 100% FIFO must end; workers at existing 100% FIFO operations must be given job security; FIFO workers should be given choice and incentives to move locally; and new jobs at existing 100% FIFO operations should be open to local workers

Queensland Council of Unions president John Battams said pressure must be applied to the State Government to ban 100% FIFO at new mines but it was hard to “unscramble the egg” on existing mine operations.

End local jobs discrimination

TWO central Queensland Federal MPs have stepped up their campaign to ban 100% fly-in, fly-out and change government Fair Work laws.

Capricornia’s Michelle Landry and Dawson’s George Christensen say the practice is devastating local jobs and towns.

They have united to introduce a Private Members Bill to the floor of Parliament House in May that would make it illegal for companies to lock people out of jobs based on their home location.

It will seek to amend the Fair Work Act to prohibit discrimination against workers based on where they live.

Mr Christensen said FIFO job advertisements that declared “applicants must live within 100km of Brisbane Airport or Cairns” smacked of discrimination.

He said the Bill, if successful, would help end the practice on some coal mines where workers who lived locally in Moranbah, Dysart, Nebo and Mackay were locked out of applying for jobs because they did not live in Brisbane, Cairns or the Gold Coast where companies preferred to source FIFO staff.

“This Bill’s intention is to ensure that central Queenslanders can apply for central Queensland jobs in our coal mining sector,” Ms Landry said.

Second Oaks Property for Mackay

Oaks Hotels & Resorts has announced plans to open a second new-build property in Mackay on Central Queensland’s Coast early this year.

In the final stages of development, the Oaks Carlyle will join sister property Oaks Rivermarque in Mackay’s growing city centre and offer business and leisure travellers the choice of the 59 contemporary hotel rooms and self-contained one, two and three bedroom apartments.

Oaks Hotels & Resorts’ chief executive, Brett Pointon, says the addition of Oaks Carlyle to the company’s growing property network has capped off a successful year of growth in 2014 and signals an exciting start to 2015.

“We are thrilled to announce the opening of a new Mackay hotel under Oaks Hotels & Resorts’ banner in early 2015, taking our total property count to 49,” he said.

“Mackay continues to flourish as one of Australia’s most lucrative resource regions, resulting in an ongoing demand for central, serviced apartments, so increasing our accommodation inventory with the launch of a second property was therefore a natural progression.

“Mackay also prevails as a holiday hot spot, lending to the unique combination of city, sea and rainforest, and its close proximity to the world-famous Great Barrier Reef, so we anticipate strong interest from leisure travellers in addition to a steady corporate base.”

The Oaks Carlyle is set to open in March.

Mining towns to ‘bounce back’ in 2015 – Mackay

The Mackay property market has stabilised and will benefit from the announcement of major mining projects in the Galilee Basin, stakeholders in the region have claimed.

Trinity Property Consultants, the developers behind a new master-planned community in the area, said mining activity is on the up again in the region, with the Queensland government approving the $16 billion Adani Group Carmichael Mine project, which includes construction of a $2.2 billion rail line to link the pit to port.

Carmichael would be Australia’s largest thermal coal mine and, combined with rail and port operations, is tipped to provide more than 10,000 direct and indirect jobs alongside supply opportunities for local businesses over 60 years, the group said.

State and federal approval has also been given to GVK-Hancock Coal’s Alpha Coal and Kevin’s Corner projects, Waratah Coal’s Galilee Coal Project, and the AMCI and Bandanna Energy’s South Galilee Coal Project.

REIQ zone chairman for Mackay, Peter McFarlane, said the local property market had turned the corner and was well on the way to recovery.

“Economic indicators are signalling a levelling-out of the Mackay region real estate market,” he said. “We have the lowest interest rates in decades, which presents an excellent opportunity for buyers to get into the marketplace.

“There are huge mining projects coming to the Galilee Basin, and Mackay has a very big industrial sector and is in the ideal situation to service the development of those projects.

“The mining projects will bring an increased demand for housing and accommodation, as Mackay will be a base and a step-off point for workers.

“There is a lot of money being invested and infrastructure being built around Mackay by forward-thinking people who can see we are going to be the service hub for this huge mining development.

“The Mackay council and business community is working to accelerate that.”

Trinity Property Consultants’ Jim Relph said Mackay is set to become the “engine room for the Queensland economy”.

“Mackay is ideally situated to supply workers and industry services to all of these projects for the entirety of their duration, with great economic benefit to the city,” Mr Relph said.

“Mackay has historically been the service hub of the surrounding regions, including the Galilee Basin and Bowen Basin, providing a solid base for the region’s strong local economy.

“This is a sturdy foundation on which the Mackay city and the region can continue to build, with these major new mining projects providing more local opportunities for growth into the future.”

In December, MPM Property said the Mackay property market was set to be a beneficiary of the rollout of the National Broadband Network (NBN), with the company predicting the infrastructure upgrade would attract quality tenants and drive prices higher.

Source: http://www.smartpropertyinvestment.com.au/news/13873-mining-town-to-bounce-back-in-2015