Gold Coast Sinking Under Apartments Glut

The front page of the AFR on Wednesday, 9 March 2011:

"Gold Coast Sinking in Units Glut"

Summary:

• 2000 apartments worth an estimated $2 billion listed for sale
• few buyers
• dire oversupply
• only 300 apartments are selling on average each year
• between 5 and 7 year supply of apartments
• high asking prices and a reluctance by banks to lend had compounded the oversupply problem
• NAB less likely to lend to the Gold Coast apartment market
• Mr Korda, receiver for The Oracle, estimates average apartment price for the past 10 years has been about $400,000, while the average price for an Oracle unit is $1.2M.
• Soul will add to the glut, where the average asking price for the top third of the 77 storey building is $3.87 million.
• "If you have a $1 million apartment, you could probably only get bank finance for $360,000" Mr Korda said.
• Its a price point and liquidity issue.