The month in review: Sydney
By Herron Todd White
April, 2010
Rather than providing a weekender getaway – Sydney
is generally a place people want to escape from. There
are some treasures on the outskirts that appeal to those
wanting a weekender within easy driving distance on a
Friday night.
We have looked at three options for those finding
themselves with some surplus cash and looking for a
holiday home on their doorstop that has the added
appeal of commuting distance to the office on a Monday
morning.
LOW BUDGET
The caravan holiday parks of the Hawkesbury River offer
an entry point weekender for those with an interest in
boats – whether it is fishing or water sports.
Caravan park sites or small cabins within group
developments offer a family friendly environment for
people with similar interests. The appeal is to a broad
range of socio economic groups but the access to
community facilities and low maintenance amenities
appeals to young families with cabins in these estates
asking between mid $200,000s to $400,000 (new).
Opportunities within these parks vary in line with
consumer confidence in the economy but the interested
buyer will be opting for a lifestyle investment, not shortterm
capital growth.
MID BUDGET
The upper Blue Mountains suburbs of Leura, Katoomba
and to a lesser degree Wentworth Falls, have long
been areas which have benefitted from a demand for
weekender style properties.
A typical ‘weekender’ in the upper mountains is a character
weatherboard cottage offering two to three bedrooms
on a low maintenance allotment with renovated internal
fittings, established garden and good presentation. It
enjoys good access to the village shops and restaurants
and views are an added bonus.
Activity has renewed recently after a long period of
inactivity post the GFC. A stabilisation of the Sydney
prestige market has seen a trickle on effect on the holiday
house market in the region. Several reported sales
recently in Wentworth Falls have occurred around the
$600,000 mark with purchasers coming from the inner
city. Interestingly this may also display a trend away from
the powerhouse of the weekender market, Leura. Better
value for money and more realistic vendor expectations
may be the driving force behind this new trend.
UPPER LEVEL
For many Sydneysiders a sign of ‘making it’ is a holiday
home at Palm Beach. The exclusive facilities, ocean and
Pittwater views combined with the history and character
of the area appeals to higher net wealth individuals from
a range of private companies, financial market movers
and celebrities.
Accommodation ranges from older style non-water
front homes with expansive ocean and/or Pittwater
views through to premium contemporary estates with
private beach frontages. Entry level for a holiday home
with premium views kicks in at around $2.5 Million, with
homes of up to $15 Million in value in the area, but rarely
released to the market.
The Palm Beach ‘holiday home’ market suffered heavily
due to the impact of the GFC, whereby holiday homes
were the fist assets to be liquidated by those seeking
to restore cash flow and underpin their primary places
of residences as bonus’s evaporated, and margin calls
became commonplace. The market was flooded with these
style homes during the GFC, with value levels dropping
up to 25% in this area. Moving into 2010, confidence is
again emerging in this market, where the “high fliers” are
again taking home bonuses and purchases can still be
made well below previous market levels.
Where there were signs of an oversupply of holiday
homes on the market throughout Palm Beach, supply
and demand appears to again equalising, and value
levels still remain below previous highs, encouraging
those in a strong position to take advantage of weakened
conditions.
The prestige holiday home market will generally feel
the impact of any market downturn much faster than
established owner occupier areas, as those highly geared
in the market place will always look to off-load ‘disposable
assets’ first in times of hardship. At the ‘upper top end’ of the holiday home market, a general weakening in
economic conditions is unlikely to affect those where
perhaps two or three holiday homes are the order of the
day.
Overall it is considered, confidence is returning to
the holiday home market within Sydney as Australia’s
economic strength solidifies, overall business confidence
continues to grow and those with the cash can take
advantage of weakened conditions and realistic vendor
expectations.
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