Townsville North Queensland quarterly update
The Townsville North Queensland economic outlook has seeds of growth and business confidence but official Queensland treasury employment data shows unemployment is still lingering over 10 percent, the Herron Todd White (HTW) Quarterly Economic Snapshot reported this month.
The critical drivers of Townsville and North Queensland’s economy in the past has been construction and mining. Construction is substantially lower than what the population projections are expecting.
Townsville’s median house price has dropped by 1.5 percent to $316,500 in the quarter.
However, business confidence and infrastructure activity and investment have generated more activity in the supply chain. Adani’s announcement to include Townsville and Rockhampton as the fly-in fly-out hub for the Carmichael mine has been a key factor in sustained business confidence, which has continually improved over 6 consecutive quarters.
But the construction of the North Queensland stadium, Sun metals and Ross River solar farm developments have played a role. The start of an investment pipeline of infrastructure projects, including the Haughton water pipeline, on top of the Adani jobs announcements worth billions will be expected to flow through the economy in 2018 with better results.
The HTW report featured the key aspects of the 2016 census which shows that Townsville’s economic activity has been influenced by socio-economic programs, services and local retail as the resources sector retracted during the 2011 and 2016 period.
Townsville North Queensland’s major employment industries have been lead by Healthcare and social assistance (15.2% of employment), public administration and safety (13.3%), education and training (10.7%), retail trade (10.7%) and accommodation and food services (7.9%).
In Townsville, housing is a critical aspect of the economy. Building approvals have declined 9 percent in the past 12 months. Estimated residential building approvals are half of the 1700 dwellings anticipated to be needed to reach the projected population growth of the region.
Townsville’s median house price has dropped by 1.5 percent to $316,500 in the quarter. Unit median prices have dropped by 15.5 percent during the quarter to $236.500. The Burdekin median house price is $180,000, down 2.9 percent while Hinchinbrook house prices have been steady at $202,500. Charters Towers has seen a 23.8 percent drop in median house prices in the quarter.
Should population growth of over 2 percent occur in Townsville based on Treasury projections, and dwelling construction fails to keep pace with demand, the rental vacancy rate is expected to fall and even push rental prices up for the first time in years.
Townsville’s median rental price is $285 per week for 3 bedroom houses, down 3.4% in twelve months, while two-bedroom units show a median price of $240 per week also down 4.0% in twelve months. Three bedroom houses in all surrounding districts have a median rental price of $250 per week.
Townsville North Queensland tourism inflows have declined for domestic travellers while international guests have increased over the past twelve months. Up to June 2017, Townsville’s domestic and international visitors contributed $861.8 million to the economy.
Domestic overnight visitors dropped to 1.1 million per annum and international visitors jumped to 132,000 per annum up to June 2017. 109,000 international holiday goers visited Townsville which is an increase of 18.2 percent. Visitors from the United Kingdom and Germany have been the highest contributors while New Zealand visitors to the city decreased by 15.7 percent. Visitors from the Netherlands increased by 110 percent.
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