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Tourism and Property Trends for Hervey Bay
“Study the past if you would divine the future”
Confucius (550-478BC)
Property Cycles
� The seven year property cycle is apparent in most western capitalist economies such as USA, Canada, UK, NZ and Australia
� The length of the cycle is a function of housing supply, consumer behaviour and financial regulation (not necessarily interest rates!)
� Prices increases usually occur in quantum lifts
Anatomy of a Residential Property Cycle
0
5
10
15
20
25
30
35
40
1 2 3 4 5 6 7
Years
Am
plitu
de
Prices
Sales Volume
Vendors do not accept that boom is over – so they over-price, sales volume falls
Vendors who need to sell finally accept a lower price, some are forced to sell by mortgagee
Production of new allotments and houses nose-dives. Stock becomes depleted until almost exhausted
Demand outweighs supply
Speculative “rush” buying occurs for fear of prices increasing even further. Prices escalate rapidly.
BRISBANE CITY UNIT SALES CYCLE
0
1000
2000
3000
4000
5000
6000
7000
D80
J81
D81
J82
D82
J83
D83
J84
D84
J85
D85
J86
D86
J87
D87
J88
D88
J89
D89
J90
D90
J91
D91
J92
D92
J93
D93
J94
D94
J95
D95
J96
D96
J97
D97
J98
D98
J99
D99
J00
D00
J01
D01
J02
D02
J03
D03
J04
D04
J05
D05
J06
D06
J07
D07
J08
D08
Half Year Ending
Source: Qld Dept of Natural Resources, Midwood QLD Investment Report
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
No. of unit sales
No. of Sales
Average Price $
GOLD COAST HOUSE SALES VS STANDARD VARIABLE HOME LOAN INTEREST RATES
0
1000
2000
3000
4000
5000
6000
7000
Half Year Ending
Source: Qld Dept Natural Resources, RBA
No
. o
f S
ale
s
0
2
4
6
8
10
12
14
16
18
Inte
rest
%
Int Rates %
No. of Sales
HERVEY BAY CITY HISTORICAL HOUSE SALES
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: PDSLive
No
. o
f S
ale
s
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
Med
ian
Sale
Pri
ce
No. of Sales
Median $
Housing Affordability – Compare the Prices
Source: REIQ
9$310,000Fraser Coast
7$365,000Townsville
6$375,000Cairns
0$380,000Mackay
14$385,000Gladstone
13$395,000Whitsundays
15$495,000Brisbane
10$505,000Gold Coast
23$785,000Noosa
Growth % 07-08
Median House Price Yr to Sept 08Location
New Apartment Selling Prices
Source: Midwood QLD Investment Report
$8,500CaloundraRumba
$7,000Labrador (GC)Coast Marine Parade
$6,900MooloolabaCoco
$6,200MaroochydoreEmporio
$6,200Hollywell (GC)Allisee
$5,800Tweed HeadsSilvertsone
$5,500BroadbeachSurf 120
$5,300Woody PointPoint Plaza
$5,300RedcliffeMarine Cove
$5,000MaroochydoreHorton Apartments
$5,000Labrador (GC)Harmony
$4,700RedcliffeMoreton View
$4,500Hervey BayRamada
Price per sqmLocationProject
Location Location Location!
� The most important attribute of Hervey Bay is that it is one of the few north facing beaches in Queensland
� Easily accessible from its closest capital cities
� Gateway to Fraser Island
� Growing industries in business, tourism and construction
Hervey Bay/MaryboroughPopulation Growth
� In 2006 the population was 83,024 with 5.3% growth over 2005 (the highest amongst Australia’s 70 largest cities)
� As at February 2009 the population was an estimated 90,300
� Projected growth rate at 3.4%pa
� The region is estimated to grow to 100,000 in 2012
Hervey Bay/Maryborough Population Growth
31,831
37,932
43,090
53,849
70,779
27,547
67,259
26,525
83,024
0
5,000
10,000
15,000
20,000
25,000
30,000
1966 1971 1976 1981 1986 1991 1996 2001 2006 2011
Source: Midwood Queensland Investment Report
10,000
100,000
Logarith
mic
Scale
90,300 in Feb 2009
Queensland Population
� In 2006 the population was 4,046,880 with a growth rate of 2.1% over 2001-06
� As at February 2009 the population was an estimated 4,266,000
� Projected growth rate at 2.0%pa
� The state is estimated to grow to 4,496,000 by 2011
QLD Population Growth
1,827,065
1,674,324
2,037,197
2,295,123
2,587,315
3,655,139
2,977,810
3,368,850
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
1966 1971 1976 1981 1986 1991 1996 2001 2006 2011Census Year
1,000,000
10,000,000
Source: Midwood QLD Investment ReportL
og
ari
thm
ic S
ca
le
4,046,880
4,266,000 in Feb 2009
Tourism Trends
� Tourism into Hervey Bay has skyrocketed since the airport expansion was completed in 2005
� Air passenger movements have increased by 25.5%pa since 2000 and at 79%pa over the past three years
� Direct regular weekly flights from Sydney by Qantas Link, Jetstar & Virgin are now operational
� Connections from Melbourne are imminent
Total Passenger Movements - Hervey Bay Airport
0
50000
100000
150000
200000
250000
1999/2
000
2000/2
001
2001/2
002
2002/2
003
2003/2
004
2004/2
005
2005/2
006
2006/2
007
2007/2
008
Source: Hervey Bay City Council
Hervey Bay/Maryborough Accommodation Statistics
Source: ABS 8635.3.55.001
5%5%0%-3%3%2%% chg
$102.3511.6113,34859.76,7252,064Sep-08 Qtr
$97.6611.1113,89961.56,5482,014Sep-07 Qtr
Total
0%6%6%-3%7%9%% chg
$127.365.644,09556.13,042855Sep-08 Qtr
$127.705.341,58757.82,846782Sep-07 Qtr
Serviced Apts
8%5%-3%-3%0%-1%% chg
$81.064.048,90765.62,418810Sep-08 Qtr
$74.933.850,58767.52,411815Sep-07 Qtr
Motels
7%0%-6%-2%-2%-4%% chg
$99.332.020,34655.61,265399Sep-08 Qtr
$93.092.021,72556.81,291417Sep-07 Qtr
Hotels
Rates per nightTakings ($m)Nights SoldOccupancy (%)Bed SpacesRooms Avail
Discretionary Spending Growth
� Apart from tourist numbers, the tax paying population has increased at the rate of 5.6%pa between 1997-2003
� This means that spending growth is not just reliant upon retirees
Hervey Bay/Marybrough Half Yearly Dwelling Approvals
0
200
400
600
800
1,000
'93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 08
Source: ABS 8731.0
Units
Houses
7 Year Av Total
Website: www.midwoodaustralia.com
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