Gold Coast developers prepare for Mexican wave

Gold Coast developers prepare for Mexican wave, By Lisa Pryor
Property Reporter - 10th April 2004
(Credit: The Sydney Morning Herald)

Gold Coast property developers will be shining their white shoes in preparation for the expected influx of investors escaping new property taxes in NSW.

With south-east Queensland still in the grip of a property boom, consumer advocates warn that the influx will exacerbate the problem of real estate marketeers charging one price for locals and another inflated price to out-of-towners.

Real estate critic Neil Jenman said he was already receiving calls and emails from consumers indicating that marketeers had stepped up their activity since the new laws were announced.

"They'll be the Pied Pipers leading people to the promised land of Queensland," he said.

"They're all booking seminars in the southern states."

Anthony Field, principal of Elders Real Estate at Nambucca Heads, says investors are already heading north.

"I've had four sales fall over this morning directly attributed to the Carr Government budget," he said on Thursday.

Unlike in Queensland, NSW investors will soon face an additional 2.25 per cent exit levy when they sell.

In NSW, all investors will be lumped with a land tax bill, while in Queensland properties on land worth less than $275,997 are exempt.

Queensland was already looking good to NSW investors before these changes. Brisbane and the Gold Coast have experienced massive price growth while the Sydney market has faltered.

The median price of a house in Brisbane leapt 40.5 per cent in 2003. Sydney prices increased by 7.2 per cent in the same period, Home Price Guide figures show.

However, the longer Brisbane growth rates are maintained the greater the risk of prices overshooting and then correcting, CommSec analysts concluded in the Property Quarterly report, which was released in March.

Then again, the strong capital growth has been underpinned by high levels of interstate migration, with 39,200 people moving to Queensland last financial year, up 8000 on the year before.

Every week, the Donald Property Group in Edgecliff has been flying prospective buyers to Queensland on a private jet to inspect Coral Cove, a resort-style development with golf course near Bundaberg.

Katie Gold, sales associate at Donald Property Group, said she had noticed more interest from Sydney buyers since the new taxes were announced.

"Since Tuesday the callers were calling up saying 'we're not going anywhere in NSW any more, we're not interested. We're going to Queensland, that's where the growth is'."

The company was now looking further afield, seeking hot spots in Adelaide and Perth.

Investors venturing beyond their geographical comfort zone could take action to make sure they would not be ripped off, Mr Jenman said.

"They get an independent lawyer, an independent valuer and they check what happened to the clients that bought from this company before," he said.

"I've never seen anybody caught if they do those three things."


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Gold Coast