Evil or not?

The effect of new development on existing real estate.

Increased development of apartments is a national trend which has been building for a decade and is unlikely to change anytime soon.

Gold Coast City had a 52% increase in construction approvals over the last financial year. More than any other city in Queensland.Main Beach and its’ neighbouring suburbs are amongst those on the Gold Coast most affected by this trend.

Effect on prices of existing real estate is not a consideration in planning decisions.

This however, is often an objection put forward.

Another common objection centres around loss of amenity due to increased pressure on existing amenities.

Loss of lifestyle is another concern. Removal of public facilities and open space to allow for development. Our waterways and natural attributes are the reason a lot of us live here and the largest reason by far why we have so many holiday-makers every year.

Changes to the existing persona of a community.

There is increasing concern about pressure on traffic flow in Main Beach. Already traffic jams along The Spit and Gold Coast highway are the norm and residents are concerned that little effort is being made to help!

We are not alone here. New developments in Surfers Paradise, Broadbeach and on Chevron Island are also causing great anxiety amongst current residents. The daily commute (however short) for some residents is already onerous and unpredictable and solutions don’t seem to be coming forward as fast as development approvals!

Developing suburbs to the west are also suffering from congested roads. Let’s not even mention the M1….

Loss of views can, and has, lead to loss of value in some cases. So far, fewer of these cases exist than might be expected. My experience suggests that it has to be a significant loss of views to affect price. Small comfort of course and I am only talking about the effect on prices, not enjoyment…

Prices can however be expected to change.

In my experience, very generally, prices seem to follow the current trend in the short term. And as discussed previously, prices are currently moving in an upward direction.

Prices of existing real estate, in some areas, rise more quickly in the area once the development is completed.

An increase in population can provide the increase in critical mass necessary for better services – both private, like cafes, clothing stores and other services, and of course better infrastructure provided by the different levels of government. Strong schools, shopping, roads and lifestyle options provide the backbone of a community and are a consideration for buyers. Any improvement is also the backbone for property values and can lead to an increase in values.

In Main Beach most of the proposed new development is for high-rise buildings, taking existing freestanding properties out of the pool, increasing the scarcity of this type of property. No doubt this will affect values of this type of property.

An oversupply of a certain type of property can certainly lead to a drop in values. Suburbs such as Southport could be headed in this direction. Zoned as a special development area many high-rise buildings are under construction or have been approved. Simply, if the balance between supply and demand is tipped out of balance prices are affected.

Evil or not?

It is not possible to keep everyone happy! As a community we certainly have a complex set of needs and wants!

We all need to compromise somewhere.

It seems some of the proposed development in Main Beach has created strong opinions amongst locals. Some for and some against.

My only opinion, at this stage, is that Main Beach is evolving rapidly and careful, sustainable planning must be made!

Some of the changes to the City Plan etc that are proposed are significant, and some of the proposed developments that are being put to us via the media are a little different to what has been the norm, and if you have an opinion/objection/suggestion, make it known!

So, evil or not? There are positives and negatives to the changes. The answer to this is subjective. In general, and please seek your own professional opinion and not rely on mine, history suggests new development will not affect the positive trend in Main Beach property prices in the short term.

If there is a nett increase in amenities and the vital improvements to roads are made, history suggest that values will increase.

There are so many possible influences on the value of all Australian property right now that I don’t think economists or clairvoyants can project values accurately.