Research report on the Sunshine Coast, Australia

1. Research Summary
Why the Sunshine Coast
Helping people
secure great properties

2. Disclaimer: This material is provided to you to summarize source information on the development and infrastructure currently underway and planned for
the Sunshine Coast. The information presented is provided purely as information and should not be construed as specific investment recommendations. No
predictions of the effect on the growth or otherwise of property values are made or implied.
The laws relating to property, investment, taxation, benefits, and the handling of money are constantly changing and are often subject to changes in government
policy, and while every care has been taken to ensure the accuracy of the material contained herein at the time of publication and presentation, neither the
author, promoters nor the publishers will bear any responsibility or liability for any action taken by any person, persons or organisations on the purported
basis of information contained in the material.
Without limiting the generality of the foregoing, no person, persons or organisations should invest monies or take other action on reliance of the material
contained in this material;, rather you should seek independent advice (whether by expert advice or otherwise) of the appropriateness of any such action and
take into account your personal circumstances.

3. Introduction
If you have dealt with us before (or at least read our Welcome to Investor Property brochure) you will know that one of our
core convictions is to ensure the properties we offer are in well researched areas. We were always excited about what
is happening in South East Queensland, particularly the Sunshine Coast, and decided to put together this summary
to help you understand the strong property investing fundamentals the region offers. Fundamentals that cause us to
believe the Sunshine Coast provides outstanding opportunities over the next 10 – 20 years.
There’s an old adage in property that “all property doubles over time” and the statistics support this (if you do some
research – the common comment about property doubling every 7 to 10 years works right back to the early 1900’s). We
don’t see any reason for this to change in the next 100 years, however we also believe that there are other drivers that
help property grow in value. We look for these drivers when we conduct our research in order to maximise the potential
returns. Our aim is to do better than just ‘flow with the tide’ (albeit a tide that’s made many people wealthy over time).
Our hope is this summary will not only provide you a good understanding of the fundamentals you should be looking
at in your own research as you grow your portfolio, but also give you the confidence to invest on the Sunshine Coast (if
not, at least you’ve got some knew ‘stats’ for your next BBQ!)
Population Growth
The first factor to understand is that from 2001 to 2031 forecasts suggest we are going to see the population of the
Sunshine Coast double! In the 2001 Census figures, 247,200 people live on the coast; projections issued by the State
Government have the Sunshine Coast breaking through the 500,000 people barrier by 2031 and more than 1,000,000
between 2040 and 2050 if current trends continue unabated. As can be seen by the chart, this growth speeds up
from approximately 2007 to 2026, which is now. This population growth comes from two key areas: southern states
migration and people moving from overseas (mainly the United Kingdom and South Africa). Interestingly, reports in
September 2009 suggest Australia’s growth could have been underestimated by 25%!
Keep in mind that every time a new family moves from Brisbane, Melbourne, London, Johannesburg, etc, the first thing
they need is somewhere to live. A large number arrive, rent for the first 6-12 months then buy. There is also a significant
percentage who arrive and look for readily established housing straight away. Many investors on the Coast have a
second income called ‘building speccy’s’ for those new arrivals that are so happy to be in their new piece of heaven and
they don’t want to wait 6 months to build. We often see an up lift in valuation on properties being built for this reason
(but be cautioned, the term ‘speccy’ is short for speculation; this strategy and, importantly, the type of house, location
and number of other people using the same strategy can have a large bearing on its effectiveness).
Recent and Forecast
Population Growth -
Sunshine Coast 501,200
473,300
383,300
Forecast
295,100
247,200
2001 2006 2011 2026 2031
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4. Changing Household size
As can be seen in the graph below, over the next 13 years the average number of people living in each home across
Australia is forecast to reduce from 2.6 people per home to 2.25 people. This is one of the key drivers being placed on
developers for smaller lots. For some of us, we need to reset the mind that smaller homes are back in vogue. There’s
always a market for large homes but the population dynamics are changing.
Forecast
2.60
2.36 2.31 2.25
2008 2011 2016 2021
Weekly Growth
Perhaps one of the greatest drivers on the Coast is this one: every week we need 77 new homes (based on current
household sizes) yet only 65 new homes are being built - that’s 624 homes this year alone that we’re short! At
present this shortfall is being covered by reducing the number of rental vacancies; but that ‘band aid’ can only stretch
so far.
Population Housing
Arrivals 333 Requirement 77
Departures 132 Completions 65
Net Weekly Increase 201 Net Weekly Short fall 12
The State Government forecasts we will need approximately 98,500 new dwellings built on the Sunshine Coast by
2031. Based on our current rate of supply, the shortfall could increase to over 1,100 properties per year fueling the
already, pent up demand!
Impact of population growth
With fast population growth opportunity arise. The ‘magical’ self sustaining number of 500,000 brings with it better
motorways, public transport, an airport that provides variety of flight times and destinations, theme parks, diversified
employment opportunities and the list goes on. The downside of building a population on the run is we get use to road
works as areas are expanded (next time you are stuck in road works, keep your eye out for why that work is happening,
this might just be the next area that’s about to take a capital growth upswing).
As a property investor it is important to note that this growth, the low level of required completions and the decreasing
average household size suggests the underlying demand on property will increase for some time. Thereby placing
upward pressure on prices and rents and downward pressure on vacancy rates. Very good news indeed.
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5. Infrastructure and Development
The old catch cry in property has always been ”location, location”. As property investors however, we believe it should
be “infrastructure, infrastructure” (which is not really that different to location, just with some further long term analysis
attached). People are seeking easy access to parts of the Coast via motorways, public transport (will become so much
more important in 10-15 years) and sound road systems. We’re looking to live in communities where the kids have easy
access to great schools, where there’s a Supermarket with the 10-15 convenience shops on the outside (the baker, cafes,
chemist, pizza shop, etc). People want to know that where they live has a sense of belonging and local councils seek to
maintain the cultural integrity of the area (parks, beaches, building height, etc). This encourages developers to strike a
balance between urban jungles and open spaces. People want to live in a community where they can take their kids to
a park, perhaps overlook a lake and enjoy a BBQ.
Today, the infrastructure has the responsibility of allowing families to
live in such a community, seemingly their own little village, whilst being
able to step out of that community and within a few minutes be on a
motorway to the office or to visit a friend in another community.
The Sunshine Coast, particularly in the southern reaches, is seeing an
explosion of growth including:
• New University Hospital
SunshineCBD inMulti-Modal Transport Corridor
• New Coast Kawana, Caloundra and Maroochydore
• The 2008
Novemberdevelopment of a multi-modal transport corridor
• Several large estates being brought forward by up to nine years
SIPPY DOWNS
Some of these infrastructure projects are discussed below. INTERCHANGE
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New University Hospital BUDERIM
SIPPY DOWNS
Nestled in the heart of Kawana is a site that will represent the Sunshine Coast’s new University Hospital. This site is
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scheduled to open in 2016. This University Hospital will employ 3,500 people and as a training facility, we’ll see a significant
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number of students and post-graduates completing their studies in this hospital. Part of the plan of development is a
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road and rail network (discussed in the ‘CAMCOS’ section) joining the hospital with communities around the Coast. This MAROOCHY BO
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location will also drive a significant need for housing close by. There are some impressive land communities around this
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location and we’ve watched many of our astute buyers invest in these locations before the anticipated ‘upswing’.
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Main Roads – Connecting Queensland
www.mainroads.qld.gov.au
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