Buyers pay double for land fronting golf courses

Posted on 15/04/2008  
Trust residential analyst Michael Matusik to come up with the pithy "tee change" to describe the drive, if you like, by keen golfers to buy land and build homes fronting the nation's fairways. Matusik has been collecting statistics on golf residential property for at least a decade and in his latest research he reports that the trend is alive and well.

Buyers are prepared to pay an average premium of 92% to live on a golf course fairway. An analysis of vacant allotment sales at six key Queensland golf estate shows buyers paid between $480 and $1,146 per square metre for vacant land fronting the fairways of South East Queensland coastal golf courses.

The highest price per square metre was paid at Hope Island ($1,146), followed by Twin Waters ($800) and Peregian Springs ($641). The weighted average price of $722 per square metre is 92% higher than the equivalent non-golf residential allotment in the same areas.

In 2000 buyers were paying 15% more to live on the fairways. This rose to 70% in 2003 and while the price trend appears to have slowed buyers willing to pay 92% more for golf course land appear to have done their homework on capital gains. Average capital gains in 2007 were 77% higher for golf course land than non-golf course land, Matusik reveals. Price gains of 11.5% to16% per were experienced in 2007 in the estates surveyed by Matusik.

Golf course land is indeed showing better gains than seafront property and the price of living on the beach ($2,300 to $18,500 per square metre for seafront land) makes the average $722 per square metre for prime golf frontage land seem a relative bargain.

Buying into a golf course estate comes with perks, too. They include better design (angled allotments, staggered building setbacks, strict building covenants etc), signature design golf courses (Greg Norman, for example), and exclusive membership rights.

The demographics of golf course living favour empty nesters aged 55 and over - this fits with other research that indicates the average number of rounds per golfer increases dramatically from age 45 onwards. The buyer profile is radically different from that of people who buy non-golf course land (that is, land in the same estate but some distance from the fairways). 65% of those buying non-golf course land are either local neighbourhood or local region buyers. On the other hand, 65% of golf course land buyers come from outside the local neighbourhood and region - from other South East Queensland regions (25%), other Queensland (10%), interstate (25%) and overseas (5%).

Matusik's research concentrates on South East Queensland - specifically six estates on the Gold Coast and Sunshine Coast. The report looks at Peregian Springs (near Noosa), Twin Waters (north of Maroochydore), Pelican Waters (Caloundra), North Lakes (a master-planned estate in Brisbane's north), Hope Island (Gold Coast canal estate) and Robina Woods (inland Gold Coast).

Pelican Waters near Caloundra is the most affordable of these, with land selling for an average $480 per square metre in 2007. Expect to pay more than $1 million for a decent-sized established home on a good allotment, though. Even at Pelican Waters the keen golfer with an aspiration to build a home on a fairway will be looking at $450,000 to $550,000 for the land alone. We have seen a few Pelican Waters homes on priced between $800,000 and $1.2 million which would seem to fit all of the demands of a golfing buyer.

At Hope Island, a four-bedroom home (with a two-seat buggy thrown in) is priced at $775,000. There are also golf-front apartments on Hope Island from $450,000, but for something really swish (golf course frontage and water views) start looking at $1.25 million and more.

Matusik's "Sea and Tee" residential snapshot report suggests that some of the premium built into golf course land in these six locations has to do with the combination of waterfront and golf front land. Those with a boat and a golf cart can have the best of all worlds - a quick round in the morning, out to the bay for lunch and then home for a nap before drinks in the club at sundown.


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