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February 14, 2024

Why Demand For Toowoomba Penthouses Is On The Rise

Have penthouse apartments become Toowoomba’s hottest property?

We take a look at the way our property market is changing and evolving.

A new era for Toowoomba property

Late last year plans were announced for a luxury development on Kitchener Street, near the Toowoomba CBD.

The development, which would not be out of place in Sydney or Brisbane, features 19 luxury apartments over seven levels. It’s crowned by a rooftop terrace and wellness retreat that includes a pool, spa, gym, yoga room and entertainment area.

What’s particularly interesting is that the top two floors will be dedicated to penthouses – a type of property not often advertised previously in Toowoomba.

But if you’re surprised this is happening here in our city, think again – we’ve been seeing evidence of strong demand for luxury developments lately, including penthouse apartments. And interest at this end of the market is only growing.

In fact, at the time the plans were lodged with council last November, the developers said they already had a pre-commitment from several prospective buyers.

What is a penthouse?

Usually, penthouses offer at least three bedrooms (sometimes four or five) and quite a bit of wow factor. Typically they occupy the top floor (or floors) of a building, which tends to mean they offer great views.

They’re also often generously spacious, or oversized, and tend to come with all the bells and whistles, especially high-end finishes.

In modern high rise apartment buildings, developers usually now include a penthouse or two. It’s also not uncommon for people to create their own penthouses in older apartment buildings by amalgamating two or more smaller apartments into a single larger one.

A maturing property market

In mid-2022, I was lucky to attend the auction of the five-bedroom, four-bathroom penthouse in the Grosvenor. With stunning views, great amenities and a floor space of nearly 500 sqm, this property is unique in Toowoomba, but also unique among penthouse apartments.

The auction itself was fiercely competitive, with four buyers placing bids over $2 million, and the final sale price setting a new apartment record for Toowoomba at $2.61 million.

While the price is notable, what’s also newsworthy is that it reached this level thanks to the strong competition for the property, with three motivated underbidders missing out. These parties were clearly highly motivated to buy a penthouse apartment in Toowoomba, but there simply aren’t enough to go around.

Why are apartments in demand right now?

We believe the growing demand for penthouses is being driven by two key factors: the increasing popularity of apartments over houses, and the rising interest in prestige property in Toowoomba.

  • The increasingly popularity of apartments

As we’ve written before, the apartment market across the city is experiencing a surge in demand.

According to the last census in 2021, just 4.1% of Toowoomba dwellings are flats or apartments (a quarter of the state or national averages). But with our population rising, we expect to see many more apartment complexes being built real soon.

While the lower price points in apartments often appeal to first home buyers, or those wanting a lower price to enter the property market, that’s simply not the case with luxury developments, or penthouses.

Instead, the popularity of high-end apartments in Toowoomba shows the evolution of – and increasing diversity of – our local apartment market. It also demonstrates its appeal to a wide range of buyers, from families to downsizers, and investors.

  • The rise of prestige property in Toowoomba

As we wrote last year, Toowoomba’s prestige market has been booming, with 115 sales over $1 million in just the first four months of 2023. This trend has continued.

We believe there is a long way to run in the premium property growth cycle, and penthouses and luxury apartments are going to be an integral part of this market.

Last year, we had at least two East Toowoomba properties sell for over $4 million, and we witnessed a new sales record, when a property in Redwood sold for $4.925 million. The market for high end, luxury property across Toowoomba is expanding and booming.

These top end house sales often result in the vendor becoming a buyer themselves, and seeking to downsize into an apartment. Their wish list corresponds with a penthouse or luxury apartment. However, historically there has not been a vast amount to choose from in Toowoomba.

As a result, scarcity value has kept prices high for luxury apartments, creating a pipeline of buyers who haven’t found what they’re looking for.

But it’s not just locals driving the demand for penthouses. We also have a high number of “tree change” buyers from cities including Brisbane and Sydney, who are accustomed to apartment living. Many are also used to higher price tags and are actively looking for larger apartments with a low maintenance “lock up and leave” lifestyle.

Spotlight on three-bedroom apartments in Toowoomba

While a breakdown of data for penthouse apartments is hard to find, many would be included in the three-bedroom apartment median price.

East Toowoomba: $584,500
Rangeville: $515,000
Kearneys Spring: $431,000
Newtown: $405,000

Insufficient data is available (i.e. too few sales) for other popular suburbs including North Toowoomba, Toowoomba City, and Middle Ridge.

If you’re thinking about buying, selling, investing, or renting in Toowoomba, get in touch with our expert local team today.

Article by Trevor Manteufel

With 19 years experience in selling real estate in Toowoomba & surrounding areas, Trevor is relaxed, approachable & confident, whilst providing you a high level of service, listens to your needs and makes selling your home a positive, and … View profile

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