Around this time last month Australians were spewing. The Gold Coast had been hosting the XXI Commonwealth Games pretty well for the past fortnight and then on Sunday April 15 it was all set to wrap in a closing ceremony. It did not go well.
So the last month has seen a fair bit of grief unloaded around the nation as Aussies chatted by the water cooler about how the organisers stuffed it (and while it was the organisers‚ our athletes‚ support staff, and Goldie’s wonderful volunteers were ace all the way through).
Now the dust has settled and we begin chatting about the 2018 World Cup and the next major sporting events, the really big questions surrounding the Gold Coast Commonwealth Games (GCCG) are coming into shape:
- What will be its legacy?
- Will it really redefine the Gold Coast?
- And ultimately, are major events worth the money they cost?
These questions are really important when it comes to understanding the future of Aussies working and living in cities, and trying to buy a home. Major events can bring economic benefit, but also bring a whole ton of new woes. For better or worse the GCCG are ‘done and dusted’ – and understanding what they meant is important to understand the future of home buying in Aus.
Why the Gold Coast?
For the Gold Coast this was all about putting the coastal city in southern Queensland on the map as a major events host in Australia.
Melbourne and Sydney do this sorta thing often, and Brisbane had the Games back in 1982 – where we unveiled Matilda, our biggest ever kangaroo – but this was the first time for the Coast.
The Games did come at a great time for Queensland, as between March 2017 and March 2018 Queensland saw the strongest jobs growth in the nation, charting 4.3 per cent over the year.
This alongside a population boom in Queensland that – somewhat unusually for Australia where traditionally major cities were the biggest growth hubs – has been seeing really strong growth in Queensland’s provincial areas, including the Gold Coast.
So the GCGM came at a good time for Queensland. And for everyone watching outside of Queensland, the core message of these Games was the Gold Coast is open for business, and a great place to live. This is all good stuff, and many drinks were poured toasting this message. And obviously any city that wins the right to host a major event is doing something right.
But to truly turn the hosting experience into a long-term advantage it takes some extra elements.
Which Cities Succeeded with Major Events?
When it comes to cities that have used major sporting events well, the leading example is always Barcelona in 1992. With investment in infrastructure, and a really successful Olympic Games, the vibrant Spanish city saw itself emerge as a new sporting capital of Europe.
Sydney 2000 is another great example. The first Olympic games hosted in Australia since Melbourne’s stint in 1956, Sydney used the games as an opportunity to showcase a new city, in a young country, ready to embrace the opportunities of a new millennium.
And Melbourne has a good run here recently too. First hosting the Olympics in 1956, they then built a foundation to see the city today recognised as the leading sports capital of Australia. Hosting the Commonwealth Games in 2006 was seen as another boost to the city’s brand.
So with this strong resume of other cities and their major events legacy, what legacy will the Gold Coast have?
- The upskilling of locals
Locals have been trained and upskilled for the Games. The Games will finish, but these professionals will remain, with proven experience on top of them. This is valuable not only for the ability of locals to deliver on events in the city, but also to partner with Brisbanites up the road in dual Bris-GC events.
- New infrastructure
When you host a major sporting event you get some flash new stadiums to use for years to come. The Gold Coast already has a strong sporting culture, and now they’ve a whole new lure to reel in other major sporting events.
- Relaxation of height limits
This will be a big one. Save for the stadiums this will be the most visible daily legacy. Numerous areas of the Gold Coast have seen their previous height limits relaxed. It might sound surprising at first to learn the Gold Coast still has any height limits when Q1 is the tallest building in Australia, but this issue has been something of a ‘back and forth’ that is now set for big change.
These factors are great but there’s also two major issues when it comes to the legacy of the GCCG.
Who is Watching Major Events?
The Commonwealth Games featured a number of great audiences globally. We got India, we got Canada, and mates next door in NZ, and of course the nation’s from the British Isles.
This is all well and good. But we are also missing the US‚ Japan‚ China‚ Germany, AKA the 4 biggest national economies in the world.
It also speaks to an issue with major events generally. When I was a kid (in the 90s) winning the rights to host the Olympics was a huge deal for a city. Now not so much.
In fact only two bids from Paris and Los Angeles were in hand at the end to host the 2024 Olympics. Paris got given 2024, Los Angeles 2028. Hardly a big competition, but even so the Olympics will attract a truly global audience. The GCCG were great but growing more exposure in markets outside the Commonwealth is a ‘work in progress’ for the Gold Coast.
Once upon a time major events were perceived as a massive springboard for a city into the next stage of its growth. It’s harder to achieve that in an era where streaming and online content competes for eyeballs with traditional TV content.
What is the Modern Gold Coast?
There is also an issue surrounding what exactly Gold Coasters want their city to be in future. However you look at it marketing to the nightclub crowd and a family-friendly once isn’t easy. Nobody is asking the Gold coast to go down the line of Las Vegas but Sydney has shown the dangers of doing away with your nightlife.
The fact is some destinations find success marketing family-friendly content. Think Disneyland. Then others find success marketing to the business set. Think Las Vegas, the Disneyland for adults. No city wants to be seen as unwelcoming, so it’s fine and appropriate the Gold Coast wanted to polish up its brand a little before the games.
But Metallica will always attract a different crowd than the Wiggles do. You don’t need to weigh in on which one is better to recognise some audiences are just different. Apples and oranges.
Certain attractions like meter maids are part of the Gold Coast’s existing brand. I know some call it trashy and in bad taste. But often this crowd often feels the same about other Australiana like Dunlop Volleys‚ Blundstones‚ and Tim Tams. And that’s not on: Tim Tams are great!
To the minds of many who hook conventions in the town they may up the fun sun sea and surf aspect. And it can’t go overlooked playing with fire here is really dangerous. Sydney’s nightlife has never recovered since the lockout laws. Again‚ no fair Aussie would say some change wasn’t a good idea in Sydney, but too much occured. And you can’t just hit a ‘reset’ on culture.
When you look back at the major events that had great success three key elements emerge.
Major events go well when there is:
- A compelling story the city told by hosting them
- An ability to embrace the major event totally
- A clear plan ahead to build on momentum into the future
For Sydney 2000, the games did A, and B, but less so C. Sydney told their story well, and they hosted a really successful games, but didn’t totally capitalise on the benefits of the Games.
Melbourne 2006 saw B and C done, but less so A. The Commonwealth Games was something of a spiritual sequel to the Olympic games Melbourne hosted in 1956, the first in Australia.
But that date is telling. As while 2006 did give Melbourne another tick on the box as a great city for major events (as the home of the Australian Open, the Formula One GP, the Melbourne Cup, and other events) if Melbourne didn’t host in 2006 it’s hard to think it would’ve been hurt much.
Now the Gold Coast must look to a future having done A very well, but struggled with B.
The Gold Coast had a compelling reason for hosting the Games, and hosted it well. A lot of locals are now upskilled and have experience working in a host city for a major event.
Height limits are revised, Queensland is growing‚ and it’s ability to use the games as a springboard could see the GCCG hold a great legacy. The CG may not be simply another great event like it was Melbourne’s GC but provided it avoids the mistakes if Sydney post-2000 the future is bright. But finding the balance between its new and existing identity, and defining a clear path from here will be a challenge.
The Future for Gold Coast First Home Buyers
The 21st Century has really seen Australia emerge on the world stage. By itself this is a great thing, as so many of our cities are celebrated and visited every year. The downside to that is when something is recognised as really good it can quickly become more expensive. Especially in the Australian property market where some old and stodgy practices keep the game unfair.
It’s great people on the Gold Coast have hosted a major event, and drawn the eyes of the world. But already there’s some early rumblings of the new challenges ahead. The Airbnb boom during the Games is one example, the shift in focus by some realtors in selling local property to overseas investors instead of locals is another.
To be clear, it’s a free market and buyers and sellers have the right to trade freely. Nobody’s suggesting there’s anything wrong with that. But the Gold Coast will need to think carefully in future about the sort of brand their city wants to forge. Going down the same road as other Australian cities could come with some real pitfalls.
Melbourne and Sydney may be recognised as cultural capitals of Aus, but they are also among the most expensive property markets in the world. Beyond the expense along, many residents of both cities are frustrated by the poor urban planning decisions that don’t fix existing affordability issues, but compound them. For now, Melbourne is mostly bucking this trend, and is the fastest growing city in Australia. But Sydney shows the warning signs, with 129 people on average departing the Harbor City each day to seek our a new life elsewhere.
While this is not ideal for Sydney, it is also seeing reasonable population growth in other areas, and with a population of 5 million people there will still be people at the party no matter what happens. With a population of closer to 600,000, the Gold Coast doesn’t have that same luxury. 2017 saw the Gold Coast’s median home price tick over $620,000. By 2020 it’s predicted to hit $650,000.
So will there be a GCCG ‘bump’ on Gold Coast property? Right now the data from previous major events is inconclusive as a guiding star here, and there are of course many factors that go into determining market demand in a city. Nonetheless, past performance does give some indication of future behaviour.
Part of what makes it difficult to draw a clear conclusion here is how much the data varies. London had patchy growth in home values after the 2012 Olympics, whereas Manchester’s tilt hosting the Commonwealth Games in 2002 saw home prices grow as much as 200%! Other recent host cities of major sporting events like Rio, Athens, and New Delhi are also difficult to find a takeaway for Australia given the huge differences in culture, economy, and attitudes towards property as an asset and investment.
Locally, Sydney has also hosted the Commonwealth Games in 1938, and Perth did it in 1962 before Brisbane in the early 1980’s – but the radical differences means comparing the stats between 1938 and 2018 don’t give us much insight. The experience in more recent decades suggest a bump will occur, Sydney saw a 40 per cent jump in home values 2 years after the 2000 Olympics, and Melbourne in 2006 saw a bump of 20 per cent. This will surely sound like good news for anyone in the business of property development, but considered alongside other data shows a new risk.
So What Impact Will the Commonwealth Games Have on Home Prices?
This growth is not quite as explosive as one of Australia’s capital cities, but the Gold Coast does not yet have the economic size and population to match it. That’s why Goldies will need to think carefully about fanning the flames of growth. Especially when viewed in a wider context: between 2012 and 2017 Gold Coast home values grew a whopping 48 per cent, growing 7.9 per cent alone between March 2016 and March 2017.
A new trend up the road in Brisbane with growing demand for prestige property provides a warning light here. Everyone would agree it’s great Brisbane is growing and people want to live there, so that it’s landed on the Knight Frank’s Prime Global Cities Index is not bad in and of itself. But if this sees Brisbane trend towards the unaffordability of Melbourne and Sydney most Queenslanders would also recognise that’s an issue.
The challenge ahead for the Gold Coast will be to market itself as a truly first class Australian city, while also retaining the strong sense of community that saw it host the GCCG so well.
If in 5 years the Gold Coast has continued to boom but first home buyers experience their the immense frustration and difficulty see by their peers in Sydney, Melbourne, and increasingly Brisbane, then many will look back on the Games with a new scrutiny. Especially because many look to the Gold Coast as a place to ‘begin again’ when priced out of a capital city.
This great Aussie coastal city will need to find a way to reconcile its goal to appeal to as many new people as possible, while retaining its fabric that made it a great place to live, work, and host the CGGC in the first place. Finding the right balance will take time, so that’s why it’s important the conversation begins now. To ensure the legacy of the GCCG is one that sees the city go from strength to strength, and not success to woe.