National buyer’s agency and thought-leading research firm, Propertyology, has identified ten (10) major projects, spanning across five (5) states, which will have a significant influence on the property markets of twenty-five separate locations.
In alphabetical order, the specific property market beneficiaries include Albury-Wodonga, Armidale, Beaudesert, Bendigo, Brisbane, Burnie, Cairns, Charters Towers, Dubbo, Glen Innes, Goondiwindi, Griffith, Hobart, Maroochydore, Narrabri, Parkes, Rockhampton, Seymour, Shepparton, Sydney, Tamworth, Toowoomba, Townsville, Wagga Wagga, and Whyalla.
“While the development of new train stations, shopping centres, schools, and road projects are important to their respective communities, the evidence confirms that these projects don’t have any direct impact on the performance of respective property markets,” said Propertyology Head of Research, Simon Pressley.
Every year in every city, there will always be a range of significant projects being developed yet genuine property booms are few and far between.
“From many years of property market studies, we’ve concluded that the property market impact from major project developments is determined by the scale of the economic benefits relative to the size of the community that it relates to,” said Mr Pressley.
For example, a $10 billion infrastructure project within a large capital city may have no direct bearing on that city’s property market performance, whereas investment in a $100 million project in a completely different part of Australia may generate significant momentum for its property market.
According to Propertyology’s research, along with the current all-time record low interest rates, “…one of the most exciting things for Australian real estate right now is the biggest ever pipeline of major projects.”
“Infrastructure Australia has 147 major projects on its drawing board plus the various state and local governments collectively have an even bigger list of projects,” said the REIA Hall of Fame Inductee.
“Propertyology has scrolled across the country, identified the major projects in respect to their potential influence on property markets, and have ranked Australia’s Top 10 projects.”
- Inland Rail Project: A $10 billion 1700-kilometre rail infrastructure project connecting ports in Melbourne and Brisbane to meet demand for an anticipated 75 percent increase in Australia’s freight over the next decade. The inland route was strategically chosen to more efficiently transport food and general cargo throughout the eastern states and to reduce the volume of trucks on highways. Completion of the project will provide enormous scope for Australia’s vast agricultural precincts to ramp up production as a global giant food supplier. The post-construction economic benefits for regional communities will be substantial and will have a positive influence on property markets in communities such as Seymour, Bendigo, Shepparton, Albury-Wodonga, Wagga Wagga, Griffith, Parkes, Dubbo, Narrabri, Armidale, Goondiwindi, Toowoomba, and Beaudesert.
“This project earns Numero Uno ranking from Propertyology given the considerable scale of economic benefits relative to the population sizes of the regional towns in question,” said Mr Pressley.
- GFG Alliance Steelworks: A $600 million development of a new steel mill at Whyalla by British billionaire, Sanjeev Gupta. With construction due to commence late-2020, the project will enable steel production to be double the volume of the existing plant while Gupta’s $500 million Cultana solar farm will vastly improve energy costs. The estimated 1,500 jobs created by the project is very significant for a regional city which currently boasts a workforce of 10,000 and has a median house price of $200,000.
- Western Parkland City: A series of major projects worth circa $20 billion to develop a new city in Sydney’s outer west. The $5.3 billion Nancy-Bird Walton airport will be the cornerstone of the region. The airport surrounds will be engulfed by an Aerotropolis that will be developed in 10-stages over 16-years and include numerous residential projects.
- Australia-Singapore Military Training Hubs: The Australian and Singaporean federal governments have signed an agreement for Australia to provide advance military training to 14,000 Singaporean military personnel every year for 25-years. Singapore has committed to investing $2.25 billion which will benefit Townsville and Rockhampton through facility infrastructure development. In addition to construction jobs, the 25-year provision of goods and services to trainees will provide long-term economic benefits for Rockhampton and Townsville, increasing the demand for real estate in both regional cities.
- Maroochydore City: A $430 million development of a modern CBD for the Sunshine Coast. The region’s population grew at a higher rate than any other location in Australia over the last decade. The new Maroochydore city centre development will include commercial, retail, high and medium density residential development, high-speed internet, parklands, waterways, and bicycle tracks.
- Hobart International Airport: Hobart is already attracting more internal migration than 7 out of 8 capital cities. A $200 million 3-stage expansion of the Hobart airport to accommodate international flights is due for completion before the end of the 2020 calendar year. Airport passenger volumes are forecast to double within 10-years. As shown in the below chart, Hobart’s growth in airport passenger volumes over the last 5-years is a measurement of its spectacular economic growth that drove nation-leading real estate capital growth. One should not underestimate the enormous potential for increased economic activity through easier visitor access (business travellers, domestic and international tourists, and university students).
- Queens Wharf: A $3.6 billion world-class entertainment precinct in Brisbane’s CBD, meaning that Australia’s third largest city will (finally) have a world-class precinct to rival Melbourne’s Crown entertainment and Sydney’s Barangaroo precincts. Due for completion in 2022 and developed across five city blocks, this game-changing project will attract a staggering 1.39 million visitors per year, bring billions of dollars to the coffers of Brisbane’s economy each year, create approximately 10,000 new jobs and breath an exciting new energy into the Brisbane community.
- Battery of the Nation: Currently in the early planning stages, this $5 billion project involves using a series of lakes in north-west Tasmania to produce hydro-electricity and direct it to mainland Australia via a cable across the Bass Strait. Real estate demand in the regional city of Burnie will increase as a result of jobs created by this project.
- Narrabri Gas Project: This controversial $3.6 billion energy project in north-west NSW is well advanced in the approval process. With the aim of supplying 50 percent of NSW’s gas needs and placing downward pressure on electricity prices, development of the project will create 1,300 direct jobs and even more indirect jobs for the New England region (Narrabri, Armidale, Tamworth, and Glen Innes).
- Hells Gate Dam: Agribusiness and general economic development for northern Australia will be big winners from this $5.3 billion irrigation and energy project by constructing an enormous dam on the upper Burdekin River, north of Charters Towers. According to a viability assessment conducted by Townsville Enterprise, if Hells Gate Dam is developed to full capacity, it has potential to inject billions of dollars into the North Queensland economy. The property market beneficiaries of this game-changing project will be Cairns, Townsville, Innisfail, Ingham, Ayr and Charters Towers.
Simon Pressley is Head of Property Market Research and Managing Director at Propertyology.
Propertyology is a national property market researcher and buyer’s agency, helping everyday people to invest in strategically-chosen locations all over Australia. The multi-award-winning firm’s success includes being a finalist in the 2017 Telstra Business Awards and 2018 winner of Buyer’s Agency of the Year in REIQ Awards For Excellence.
Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.
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