Property point 6 December

When I came back to work after my Christmas/New Year break in early January this year, there was a feeling that something had changed.
Yes, I was fatter, older and poorer, but that happens every year after the Christmas break. It was more than that.
My first open homes were frenetic, energised events with dozens of buyers ready to buy.
The market had been good the previous year but nothing crazy. Suddenly it was as though Santa had snuck a message in everyone’s parcels that said, “It’s time to buy in Mackay”.
I often discuss the real estate market with Gardian colleagues and a consistent topic the previous couple of years had been how we felt the market should be stronger and that prices should be going up quicker.
Rents had gone up dramatically in the previous couple of years and there was a ridiculous level of demand among tenants.
There was an incentive for tenants, if they had the money, to take the plunge and buy.
But we also wondered why investors were not jumping into the market. People who lived in southern markets only had the option of high purchase prices for investment properties that delivered a much worse rental yield than Mackay offered.
While rental yields were 1 or 2 per cent in those places, Mackay offered 5, 6 and 7 per cent yields on rental properties. Our median sale price remained way lower than other vibrant cities and regional centres.
I told anyone who listens to me that this was the place to buy … but my dog isn’t in a position to buy and did nothing about it.
First there was that frenzy of activity from local buyers in January and then, in February, the calls started coming in from investors and buyers’ agents from down south.
It wasn’t a trickle. It was a flood of investors wanting to get into the Mackay market. They were driven by the relatively low prices, high rental returns, high average incomes, low vacancy rates, low unemployment rate and the strong economy of a significant regional centre.
The world had suddenly changed and Mackay became one of the hottest markets in Australia. Investors have been driving the market, although there are also plenty of local people who have decided to buy rather than rent.
But what has it meant, in practical terms, for the Mackay market? What has happened to prices? Sit down and brace yourself for the latest figures, provided to me by realestate.com.au this week.
The median price for houses sold in Mackay in the month of November, 2023, was $490,000. The median price for November this year was $643,000. That is an increase of over 30 per cent.
That is the biggest increase in Queensland and compares with the annual national median price increase of 5.62 per cent. House prices in Melbourne, Hobart and the ACT decreased this year. Sydney prices also recently dropped slightly.
(It is true that the Mackay figure is a snapshot of prices for one month and there might have been more upper-end properties sold then, however the figures are instructive.)
The figures are great news for home owners in Mackay. However, I want the people who haven’t bought yet to bring it in close.
The median price of units was $280,000 in November 2023. This November it was $329,000. That’s about an 18 per cent increase, a lot smaller than for houses. And it means there are still units available for around $300,000.
Now, I would never give financial advice but I was telling my dog the other day that units still offer an affordable opportunity to break into the Mackay market.
I doubt my dog will do anything about it but someone might.

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