Southern Queensland rural market slated for growth: HTW
There are signs the southern Queensland rural market may be approaching a phase of property value growth, according to a report from Herron Todd White (HTW).
HTW's rural report for November said that the region has come off the bottom of the value cycle, but the big question now is how strong and sustainable will this phase be.
"Confidence is a very important contributing factor in any decision making process and this would appear to be something that is beginning to become quite abundant," it said.
"However care must be exercised not to misinterpret confidence with a need to buy for the sake of buying or to 'keep up with the Joneses'.
"The southern Queensland market, in general, has experienced a very good winter and the signs are there, especially on the inner downs, that many broad acre farmers are about to reap the benefits of the good season to date.
HTW said many areas escaped damage from 'wet feet' to their chickpea and wheat crops that southern areas experienced.
"All of the fallow country should have a very good moisture profile which will then set the region up for a potentially good summer," the report advised.
"In regards to the Maranoa region and points further west, they also enjoyed a better than average season with the country generally looking very good.
"Again, this sets them up for a good summer.
"You don’t have to be Einstein to work out that given the strength of the cattle market (despite the issues of low female numbers in the future), the fair to good seasons primary producers have experienced over the past 12 to 18 months and the fact that the cost of borrowing money has never been cheaper, all the ingredients are there to suggest there is the potential that it could run for some time."
These positive agricultural factors are good signs for the area's property market, HTW said.
"We are now at a point in the cycle reminiscent to the early 2000s and before that the mid 1980s.... just prior to the upward run in the respective market cycles.
"Unfortunately the lesson we learned from those periods was that what went up ultimately came down. Sustainability is the key and given the multitude of issues that arose from the past two cycles, it should not be a hard lesson to learn. However we sometimes have very short and selective memories."
