Sunshine Coast Housing: The Decisions That Dropped This Week

Sunshine Coast Council approved a revised development application this week for a nine-storey mixed-use tower on First Avenue in Maroochydore, clearing a path for 87 apartments above ground-floor retail in what planners are billing as a test case for the emerging CBD precinct. The decision lands as the broader Australian property market shows signs of cooling, but on the Sunshine Coast the pipeline of approved dwellings tells a different story, demand is still outrunning supply by a wide margin.

The timing matters. Sunshine Coast's population is projected to hit 500,000 by 2041, up from roughly 390,000 today, and the council is under mounting state government pressure to identify and zone land faster than it has been. The Queensland Department of Housing, Local Government, Planning and Public Works has been pushing councils to accelerate housing targets under the South East Queensland Regional Plan, and Sunshine Coast is no exception. This week's tower approval is partly a response to that pressure, an attempt to show density can be delivered inside the designated Maroochydore Priority Development Area rather than eating into coastal vegetation further north.

Short-Term Rentals Back in the Spotlight

Noosa Shire Council separately confirmed it will proceed with a formal review of its short-term rental accommodation framework, with a discussion paper due for public release by September 2026. The review targets platforms like Airbnb and Stayz operating in suburbs including Noosaville and Sunshine Beach, where rental vacancy rates have sat below one percent for most of the past two years. Council officers told a Tuesday briefing that roughly 2,400 properties in the shire are registered as short-term rentals, a figure that has doubled since 2019. Long-term rentals in the same postcodes have shrunk proportionally, squeezing out hospitality workers, teachers and healthcare staff who serve the local economy but can no longer afford to live near their jobs.

The state government's Queensland Accommodation Register, which became mandatory for short-term rental operators in January 2025, has given councils cleaner data to work with. Noosa's review will examine whether a cap on non-hosted short-term rentals is legally defensible under the Planning Act 2016, and whether a nightly levy, similar to the mechanism floated by Byron Shire Council in New South Wales, could fund affordable housing programs locally.

First Home Buyers Facing Longer Odds

National data released this week reinforces what Sunshine Coast buyers already know from attending weekend open homes: entry-level prices have not fallen enough to matter. The median house price across the Sunshine Coast local government area sat at approximately $985,000 in the June 2026 quarter, according to figures from the Real Estate Institute of Queensland. Units were marginally more accessible at a median of $685,000, but that figure is skewed upward by new CBD stock. The Queensland First Home Owner Grant of $30,000 applies only to new builds valued under $750,000, a threshold that eliminates most of the established unit stock in suburbs like Mooloolaba, Buderim and Caloundra.

Sunshine Coast University Hospital's ongoing expansion at Birtinya has drawn hundreds of specialist and allied health workers to the region since 2024, many of them renters who are now competing with investors and interstate buyers in the same thin market. The hospital's Stage 2 expansion, expected to add 250 beds by 2028, will intensify that pressure unless residential supply catches up.

Residents and investors watching the Maroochydore CBD project should note that construction on the First Avenue tower is not expected to begin before mid-2027, pending finalisation of infrastructure agreements with the Economic Development Queensland, the state agency overseeing the PDA. Those wanting to make submissions on Noosa's short-term rental review should watch the shire council's website from September; council officers have indicated the public consultation window will run for at least six weeks. For renters seeking assistance, the Sunshine Coast Housing Options Centre on Maroochydore Road remains the primary referral point for emergency and transitional housing programs.