Herron Todd White Valuers – Month In Review
As published by Herron Todd White Valuers.
Market activity in the Darling Downs region remains steady, however there are early signs of an uplift, particularly in the vacant land space. Builders are reporting a surge in new dwelling construction enquiries, particularly from first home buyers. An emerging challenge for these markets is the rapid absorption of vacant land with lots now in strong demand and limited supply.
The development of new housing estates in Toowoomba slowed significantly in the past three years due to reduced demand for land and a slowing broader economy. With recent government stimulus announcements focusing on the construction sector, to be built homes have been opened up to people who were previously unable to afford the cost of land and construction.
With a specific focus on the $700,000 price point, a very well-presented dwelling or acreage holding can be secured in the Toowoomba region. Approximately 85% of all dwelling sales in the Toowoomba region are in the sub-$500,000 price bracket with the market much less active in the higher price points. $700,000 will buy a renovated colonial dwelling in the eastern suburbs such as East Toowoomba, North Toowoomba and Mount Lofty while a modern, four-bedroom, brick veneer dwelling can be secured in Middle Ridge and Rangeville. There is limited sales activity in this price point in the more affordable western suburbs such as Glenvale, Harristown and Wilsonton.
A recent example is a renovated, three-bedroom dwelling in Mount Lofty which sold for $725,000.
A three-bedroom, renovated colonial dwelling sold in East Toowoomba for $720,000.
In terms of acreage options, well developed lifestyle properties can be found in Highfields, Cabarlah, Hodgson Vale, Preston and Ramsay for around the $700,000 price point.
A large, well presented, five-bedroom colonial reproduction dwelling in Hodgson Vale sold for $710,000.
As this segment of the market is dominated by owner-occupiers, rental evidence and yield information is limited in the Toowoomba region. Broader evidence indicates gross rental yields to be in the vicinity of 3.5 per cent to 4.5 per cent at this price point.
The outlook for residential properties in this higher price bracket may be volatile given the relatively small market segment in this region and the more discretionary type buyer who may be more heavily impacted by the COVID-19 pandemic.