While the tragic loss of lives has been devastating, and the destruction of homes and infrastructure extensive as a result of the Queensland floods, it appears many private property investors have miraculously escaped relatively unscathed.
According to a report on news.com.au, some developers and investors are very confident that the Queensland property sector will hold up in the wake of the crisis.
Co-founder of Metro Property Development David Devine optimistically says, “We have $800 million worth of projects going on in Queensland and Victoria and none have been affected by the floods.”
“We have high-rise apartments in Bowen Hills, Indooroopilly, South Brisbane and Fortitude Valley and we escaped any flood damage.
“He says rather than being lucky, the company’s research into where things should be built is what saved them.
Private property developer Mark Stockwell said although group’s Riverpoint apartments at West End had water in the basement – which saw damage to electrical infrastructure that has since been fixed – the residential floors remained untouched.
Stockwell says that in light of the latest floods the Brisbane City Council needs to change its “one-in-100-year flood benchmark” or Q100 rating that engineers and hydrologists have been using, as it is no longer appropriate.
However escaping the immediate flood damage is not necessarily the end of a happy story for developers and investors.
And some were not so lucky. In inner Brisbane, almost 600 off-the-plan apartments worth $577 million were affected by the floods. They were all under conditional contracts, which some buyers are expected to contest.
Real estate analysts are suggesting that in order to sell property in some of the worst hit areas of Brisbane price cuts of up to 50% will be required, while rents are expected to rise sharply due to the amount of displaced residents seeking temporary accommodation.
Stockwell says the value of unaffected riverfront property will continue to remain stable over the next 12 months.
“If your property hasn’t been affected by the flood there is no reason for the price to decrease,” he said. “The key to the future will be to see whether people want to start again and, if so, rental demands will increase as they wait for their new homes to be built or they want to return to their existing premises.
“The insurance companies are hardly going to be standing there with an open cheque, and it could take up to six months before you see any money from them.
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