THE Gold Coast property market is set to surge as interest rates fall to their lowest point in history.
The move is expected to bring property prices back to pre-global financial crisis levels and kickstart the city’s construction industry.
REIQ Gold Coast zone chairman John Newlands said the unprecedented low would draw pensioners and first-home buyers into the market and send house prices soaring.
“There has never been a better time to buy on the Gold Coast than right now,” he said.
“Self-funded retirees who may have been surviving on their bank deposits may in fact return to real estate to get better yield.
“These are the lowest interest rates we have seen for a decade and rental yields are continuing to rise. It is a perfect combination of ingredients for buying real estate.”
The Reserve Bank yesterday dropped interest rates by 0.25 of a percentage point to sit at 2 per cent.
Mr Newlands said the cuts would attract interstate buyers and stimulate the city’s property market in time for the 2018 Commonwealth Games.
“Sydney buyers are increasingly looking towards the Gold Coast and there will be a lot of mum-and-dad investors who will take advantage of the comparatively low prices here,” he said.
“There is also speculation that interest rates will drop again which would increase consumer confidence in time for the Games.”
Villa World managing director and Gold Coast developer Craig Treasure said the rates were “historic” and would provide relief to families on flexible mortgages.
“I have never seen rates this low in my lifetime and I’m sure a lot of families will sleep easy tonight,” he said.
“About 20 per cent of our sales are from first-home buyers and I expect even more will join the market after this announcement.
“I also expect interstate buyers will also have more confidence to invest on the Gold Coast.”
Master Builders project director John Crittal said low interest rates made construction more affordable and encouraged people to take loans.
“Housing affordability is a massive issue for the construction industry and any move in dropping the rates is warmly welcomed and supported by Master Builders.
“It sends a message that the low interest rate environment is here to stay for quite some time.”