The latest REIQ data has offered some food for thought on the Gladstone market.

While on the surface, there are some challenging conditions – the annual median house price has fallen 3.6 per cent to $270,000, which is about 35 per cent below levels five years ago – there are some green shoots in the market that we’re optimistic about.

Some areas, namely South Gladstone and West Gladstone are showing solid price growth. South Gladstone grew 4.12 per cent over the 12 months to March to a median house price of $250,000, while West Gladstone grew 2.6 per cent to $182,550.

These pockets of growth are isolated but there are a broad range of measures being introduced by government and regulatory bodies to tackle the bigger issues facing the economy.

APRA’s proposal to lenders that they remove the serviceability floor means borrowers will no longer be assessed at 7.25 per cent but rather at just 2 per cent above the borrowing rate, which will potentially bring additional borrowers to the market.

The federal LNP announced a scheme to help first home borrowers who have only 5 per cent deposit saved, essentially helping them avoid the cost of the lenders’ mortgage insurance they would normally incur. This will help around 10,000 buyers nationally and we don’t expect this will have a major impact on our housing markets.

The lowering of the cash rate to 1.25 per cent will potentially bring a small level of confidence back to the house buying market. But something that could be significantly helpful is within the power of the state government to change.

The REIQ has lobbied the State Government to broaden its First Home Owners Grant in regional Queensland to include established homes. At the moment, the $15,000 grant is only available to those who build a home. But adding more houses to the supply levels in areas such as Gladstone is detrimental to the health of the market and will serve to push prices down further. It’s a basic supply and demand issue.

The REIQ’s view is that young buyers are eager to get their foot on the property ladder and want to snap up one of the many bargains on offer I Gladstone, if only they could access the grant.