Herron Todd White Valuers – Month In Review
As published by Herron Todd White Valuers.
2020 saw increased demand for vacant land in Toowoomba and surrounding suburbs due predominantly to the well-publicised introduction of government stimulus packages. It is likely
that 2021 will continue this trend with significant demand expected for both vacant land and established housing. New construction activity across the Darling Downs region is expected
to continue deep into 2021 with a number of builders already reporting a full calendar of work for the next twelve months. The market should be further buoyed by the ongoing interest from interstate buyers with local agents reporting strong levels of enquiry.
The biggest constraint facing the local market in 2021 is the availability of vacant land. Fringe suburbs to both the north and south of Toowoomba present the highest availability of
vacant land. New housing estates such as the Avenues at Highfields, along with a number of other developments in the suburbs of Kleinton and Cotswold Hills along with suburbs to the south such as Darling Heights and Kearneys Spring make up the largest segment of new land supply in Toowoomba. These areas are expected to continue to perform strongly within the local market. A challenge that will face buyers in the coming year will be the availability of suitably skilled tradespeople with strong demand for their services expected to push out construction times.
A trend to watch in 2021 will be the demand for affordable inner-city product with renovation potential. This product can largely be found in suburbs such as Newtown, Toowoomba City, North Toowoomba and South Toowoomba. The market should see strong demand for sub $400,000 product where buyers perceive an ability to value add to their property post purchase.
A driving factor in the market is the significant trend away from renting to owning for segments of the population. This trend is caused by a number of factors, including strong competition for rental properties and the very low cost of borrowing money.
As exhibited below, the residential vacancy rates in Toowoomba continued to drop throughout the year to a low of 0.6 per cent in November. Tenants are faced with increased difficulty trying to find a suitable rental property and with increasing rents. Tenants are turning to owner-occupying or purchasing investment property more readily than in the past.
A cause for concern in the year to come will be the broader economy and how it affects the local market. South-east Queensland was largely insulated from Coronavirus throughout 2020, both physically and economically. If the economy sees a downturn in 2021 through stimulus packages ceasing or lockdowns like those experienced in other parts of the country, the market could face an oversupply of new construction and investment housing.
An interesting trend to watch in the year ahead is the growing tree change movement that began in 2020. With the lockdowns imposed in major metropolitan areas of the nation, some people are looking for a move to the country. In the year ahead it is reasonable to expect demand for rural lifestyle properties in the Darling Downs to continue to trend upwards as people shift out of major metropolitan areas.