The Sunshine Coast, located in South Eastern Queensland, recently topped the fastest growing regions in Australia and has emerged as a thriving real estate market, attracting both local and international investors. This picturesque region, known for its pristine beaches, laid back lifestyle, and proximity to Brisbane, offers a diverse range of properties catering to various needs and budgets.
One of the driving forces behind the Sunshine Coast’s recent booming property market is its growing population. With its excellent quality of life, the region has witnessed a steady influx of residents from other parts of Australia and abroad. This population growth has fuelled demand for quality residential properties, ranging from beachfront homes to suburban family residences. Moreover, the Sunshine Coast’s robust tourism industry has contributed significantly to the real estate market’s strength. The region’s natural beauty, outdoor activities, and vibrant cultural scene have made it a popular destination for holidaymakers. This has led to a surge in demand for short term holiday homes, Airbnb’s, vacation rentals, and investment properties catering to the tourism sector.
All in all, the region has averaged close to 2,500 new homes per year over the last decade and will require a further 60,000 new dwellings over the coming 20 years based on projected population figures.
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Major Projects Influencing Property Investors Within the Sunshine Coast Region
One of the main reasons investors have been drawn to the Sunshine Coast over recent years is due to its promising long-term growth prospects. Major infrastructure projects, such as the expansion of the Sunshine Coast Airport and the development of the Maroochydore City Centre, have bolstered the region’s appeal. Furthermore, the Sunshine Coast’s property market has shown resilience in the face of economic fluctuations, making it an attractive option for those seeking stable investment opportunities.
International Broadband Installation
Recently completed and terminating at Maroochydore, the 550km submarine data and telecommunications connection offers Queensland’s first and fastest international connection point from Queensland and east Australia to Asia, a key milestone in the Sunshine Coast’s attractiveness as an investment location.
The project is forecast to deliver up to 864 new jobs, stimulating local business, and is estimated to generate a staggering $927 million in new investment in Queensland. Ultimately, the cable means more jobs and more business in the local Sunshine Coast economy.
Queensland businesses will, for the first time, be able to bypass Sydney and connect direct internationally, firmly placing the Sunshine Coast on the international business map as a leading investment destination for commerce and industry for the world’s biggest data users and those looking for a location with superior telecommunications and data infrastructure.
Maroochydore City Centre Transformation and Smart City Initiative
With the Sunshine Coast suburb of Maroochydore fast tracked to become the new CBD, business, community and employment hub of the Sunshine Coast, a mammoth greenfield project is currently underway to transform a previously used golf course into over 160,000sqm of commercial, civic, community and retail space, along with 4,000 residential apartments over the next 15 to 20 years. The public/private partnership with the Walker Corporation will see up to $2.5 billion of private sector investment flow into the project and will create over 15,000 jobs over the life of the development.
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Leveraging other city wide projects, including the new international broadband undersea connection, the development scheme will include a variety of smart city initiatives, including low energy lighting, wifi connectivity throughout, and Australia’s first CBD scale underground waste management system.
Mass Transit and Public Transport Upgrade Project
The Sunshine Coast region is heavily dependent on car transport and continues to rapidly expand its urban boundaries. With population projections brining many new residents to the area, upgrades to the public transport system and the development of a mass transit plan are actively being executed.
The 2024 federal budget allocated $1.15b to the construction of a heavy rail line connecting Beerwah to Caloundra. This line will connect the Sunshine Coast to Brisbane and will further compliment the proposed local light rail system/rapid bus network to Maroochydore. This stretch, from the University Hospital in Birtinya, through to the new CBD in Maroochydore, is known as the Sunshine Coast Urban Corridor, and contains the region’s greatest concentration of population, jobs, facilities and services and is already experiencing growing traffic congestion.
Investing in the Sunshine Coast: By the numbers
Combining the recent population migration figures, along with the projected increase in residents over the coming decade, the Sunshine Coast has, not surprisingly, seen a tightening rental market. In a recent realestate.com.au article, the Sunshine Coast ranked second behind Bunbury WA as having the tightest rental market in the country. This is a continuing trend over recent years.
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Additionally, asking prices for dwellings surged dramatically over the last four years, with average growth at 12.2% per year.
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This growth has seemingly capped the yield available to property investors as rents slowly catch up.
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In the March 2024 edition of Herron Todd White’s Market in Review publication, Director Stuart Greensill provided this summary:
At the moment, investor demand is being driven by yield. But with the increase in property values, and rents not keeping pace, we are seeing yields squeezed. The current rental market remains one of the strongest in Queensland with vacancy rates below 1.0%.
Sunshine Coast: Areas we’re watching
Of course, one of the standout suburb prospects is Maroochydore. With the reconstruction project actively underway, this significant investment is expected to drive substantial economic growth, attracting businesses, residents, and visitors alike. Consequently, Maroochydore and surrounding areas may see strong appreciation in the coming years.
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Another suburb on our radar is Caloundra. Known for its beautiful beaches, relaxed lifestyle, and thriving community, Caloundra has consistently demonstrated strong rental yields and steady capital growth over recent years. With its proximity to Brisbane and the Sunshine Coast Airport, it appeals to both families and retirees seeking a coastal retreat.
Nambour and Cooroy appear to offer higher rental yields, and we’re watching to see if these continue. These areas cater to a diverse range of tenants, including families, professionals, and students, ensuring a steady demand for rental properties. Additionally, these suburbs are benefiting from infrastructure upgrades and improved connectivity to major employment hubs, further enhancing their investment appeal.
We note the Sunshine Coast is also witnessing a surge in property development, with numerous high-quality residential projects underway. Areas like Birtinya, Bokarina Beach, and Palmview are attracting significant investment in master-planned communities, offering a range of housing options from apartments to family homes. These developments not only cater to the growing population but may also present attractive investment opportunities for those seeking brand-new properties with modern amenities.
Unlocking the Potential of Your Property Investment On The Sunshine Coast
The region’s diverse economy, which spans industries such as tourism, healthcare, education, and technology, has helped mitigate the impact of recent market downturns. As the Sunshine Coast continues to evolve and attract more residents and visitors, its real estate market is poised for continued growth and investment opportunities. With its unique blend of coastal living, modern amenities, and promising economic prospects, the region is likely to remain a sought-after destination for both home buyers and investors alike.