Property investors hit hard by oversupply in Bowen
OUT-OF-TOWN investors are paying top dollar for Bowen land even though many properties are sitting empty.
A Gold Coast agent recently achieved a price of $195,000 for cleared, level, vacant land, while a Bowen agent sold a comparable block at auction for just $110,000, a variance of $122 a square metre, property adviser Opteon noted in its August State of the Market newsletter.
Bowen LJ Hooker principal Tony Doyle said the mining industry slowdown had made it a disappointing time for existing investors in the region.
There was an "alarming, massive oversupply" of properties in the region, he said.
"We have quite a few distressed landlords.
"Unfortunately, some of these people have paid record prices for something that hasn't eventuated.
"Promises of $500-$600 a week rentals haven't eventuated and (they) are renting now for $300 a week."
Mr Doyle said some unit blocks were sitting almost vacant in Bowen.
"There's one set of units here that has one tenant," he said.
"Then there's a new set of 18 units that has four tenants.
"It has slowed up dramatically."
Mr Doyle said agents were hoping the Adani and GVK coal projects proposed for the region went ahead to boost the market.
"The upside, if Adani and GVK build their port and railway and construction happens... is there'll be plenty of accommodation for everyone," he said.
"But between now and then there's an oversupply.
"We're all pinning our hopes on projects going forward and hoping the mines in Collinsville get back to production, which is slowly happening," Mr Doyle said.
"There are 170 vacant houses in Collinsville."
Mr Doyle said many who had vacated properties in the region had been laid off from their mining industry jobs and hadn't stayed around in Bowen.
"They packed up and left the district," he said.
He expects about 400 houses to be on the market over the next few months.
A Gold Coast agent sold vacant land to an out-of-town buyer for $195,000
A Bowen agent achieved $110,000 at auction for a comparable site.