King-size Rates
Today’s newsletter is 1093 words: 4 minute read.
Thursday, 4 May.
May the 4th be with you 🌌🔫
In today’s email:
King-sized: Rates reaching 7%+
A Major Tourism Event: ATE at the GCCEC
Last Week’s Poll: Results
Trending: May the 4th
Around the Web (Snippets): His Majesty King Charles III of Australia (and other places), New Tax Breaks For Small Business and a first since the 1990s
A New Section - Movement in Gold Coast Housing Prices
1. One Big Thing: An Unexpected Rate Hike
What’s Happening?
On 1 May 2023, the RBA surprised the nation and Gold Coast mortgage holders with another 25-basis point hike in the cash rate bringing it to an 11-year high of 3.85%.
What it means
With inflation dropping overall but still just tipping the 7%-mark when statistics were released just a week ago, financial pundits were predicting with great gusto that the RBA would hold the line on a rate hike.
Feel the burn 🔥
The Gold Coast effect
For Gold Coast City mortgage holders, this latest hike hits home hard, with it now tipping some over into paying over 7% on their loans.
With wages in the City not pacing those of the other capitals, many are starting to find out the hard way what a mortgage prisoner is when looking at options to refinance.
The details
With ten hikes in just 12 months, the latest RBA cash rate hike means that the average borrower will need to pitch over another $14,000 on an average loan of $586,000.
At the moment, an average house on a very small block (think 400 sqm) and in an area quite a way from the beach has an entry-level price of $900,000 to $1 million.
So, the loads of people who have jumped in with FOMO over the last two years are looking at double or more than the average needs to be forked out.
What people are saying
With some ‘banana republic’ type outcries such as:
“The RBA is out of control. Jim Chalmers needs to use his powers and step in and overrule this terrible decision.”
Treasurer Jim Chalmers has basically told people to buck up in his response, where
” I think that the rate rise is really a pretty stark, pretty brutal reminder of the difficult economic conditions, and I think people are broadly aware that we‘ve got an inflation challenge in our economy; people feel it every day. “
What to watch next
It’s a different country and totally different market; however, the cash rate in New Zealand is already at 5.25%, compared to our 3.85%.
Not that it is any indicator of what will happen here; however, they probably thought it’d pause before it got as high as 5.25%, as well…
Thanks for the feedback and keeping The GC Minute real 👊
2. Tourism Is Hot On The GC
Happening Now
Taking over the Gold Coast Convention and Exhibition Centre from 30 April to 4 May was the Australian Tourism Exchange (ATE)Trade Show.
It’s the largest convention of its type in the typically tourism-focused City.
What it Means
The ATE Trade show brings 2500 delegates to the Gold Coast.
With these delegates comes a robust economic impact on the City, let alone a meeting of the key people behind the scenes on one of our most significant contributors to the local economy.
Destination Gold Coast (DGC), a membership-based marketing organisation committed to driving tourism, estimates that the ATE Trade show brings with it $9 million in economic activity.
The Details
2023 marks the first time since 2019 that the ATE returned to its traditional format.
ATE delegates from tourism businesses, including wholesalers and retailers from more than 30 countries, converge on the City of Gold Coast.
Here, they brought together the most cutting-edge technology and innovative ideas that the industry has needed to double down on since Covid times.
As they network, they are also spending on the local economy while exploring the world-class tourism offerings of the area.
Think spectacular golden sand beaches, the home to the world’s first floating underwater reef, waterfalls, first-class surf and hinterland hiking trails, all within an hour of the city centre.
Living the dream.
What people are saying
Tourism Australia Managing Director Phillipa Harrison noted, “International travellers are returning to our shores, but the competition for the global tourism dollar is now greater than ever before, which is why business-to-business events, such as ATE, are so important.”
Destination Gold Coast Interim CEO Karen Bolinger commenting on the excitement of the ATE visitors, said,” ATE will be our time to shine and showcase to the world a rejuvenated Gold Coast as delegates experience first-hand every flavour of our City that we enjoy every single day.”
The Gold Coast Effect
As the Gold Coast Convention & Exhibition Centre returns to normal, it will again generate nearly $100 million in revenue.
The economic impact of conventions and trade shows cannot be overstated.
Outside of the obvious benefits, the get-together will do for the industry and the Gold Coast, a dollar spent locally boomerangs throughout the economy 4-6 times, which means that $100 million of convention activity creates $400 million to $600 million in economic activity for the City of Gold Coast.
Show us the money.
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3. Trending
4. Around The Web (Snippets)
Small Business Cash: Gold Coast small businesses to get a 20 per cent deduction for spending on “more efficient use of energy.”
The Coronation of His Majesty King Charles III: With 15 visits and two stints living here (Geelong), the Coronation of King Charles III is maybe a once-in-a-lifetime live viewing event for some. History in the making can be seen live here.
Mortgage Affordability at its Worst since the 1990s: An average buyer today would need to pay 45.4 per cent of their household income to afford the median house, the highest since 1990 when it was 45.5 per cent
His Majesty, King Charles III, subscribing to The GC Minute
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