The month in review: Sydney
By Herron Todd White
May, 2010
Getting a handle on the Sydney property market is no
mean feat. The largest City in Australia boasts a wide
variety of residential property from modest worker
cottages of the outer suburbs and city fringe, to those “jewel in the crown” suburbs with sparkling Harbour views.
The potential purchaser needs to be well researched and
have an understanding of not only the local community
but also the supporting infrastructure when considering
where to put their money.
With such diversity in the greater Sydney metropolitan
area we have provided two options to each segment to
offer a variety of choices for the reader.
High Flyers:
Point Piper, Darling Point, Vaucluse
What type, size, quality, age etc housing is typical for each
suburb?
These sought after Eastern Suburbs locations feature
detached dwellings, including substantial period estates
through to high contemporary quality on harbour front
and non-harbour front blocks. Period homes have
generally been extensively renovated over the longer
term. Building sizes for these grand homes can range up
to 700 sqm and beyond internally with most offering at
a minimum 2 through to 8 or 10 garaging depending on
block size.
Land area and ancillaries that are usual?
Land area ranges from 500 through to 5000 sqm (larger
sites rarely if ever released to the market). Ancillary
features include older established gardens and grounds
which surround the period homes through to extensive
terraced lawn, landscaped for privacy with indoor and
outdoor pools complete with state of the art outdoor
kitchens. Many are within gated security grounds. Mooring
facilities are also common on water front properties with
the larger parcels also including tennis courts.
What are the price points?
Prices ranging from $5,000,000 through to around
$50,000,000 (record sale of $47 Million paid for “Coolong” at Vaucluse on 4000 sqm waterfront site). Homes over
this price exist but are rarely released to the market.
What is the buyer profile?
These areas are particularly attractive to high net wealth
individuals with many of the established society families
of Sydney based here. Generally the market is dominated
by ex-patriot, old wealth and overseas purchasers.
What features make these suburbs the most
expensive?
The calibre of the home’s surroundings, their proximity to
the harbour and highly sought after views. This region
of Sydney is within 10 kilometres of the CBD and has
established private schools, boutique shopping centres
and beaches on its doorstep.
Given the current climate (some returning confidence but
with interest rate rises looming), what are the prospects
for this area?
The prestige market is currently sitting below the peaks
of 2007 due to the impact of the Global Financial Crisis
(GFC), nonetheless the market is strengthening. Good
buying was enjoyed during the GFC, with solid gains
predicted over the longer term.
Could you advise what might be a good and what
might be a bad investment in each location?
Good investment - worst houses in best streets with
scope for renovation (views and proximity to parks and
harbour are highly sought after).
Bad investment – overcapitalised homes which may be
considered “too” contemporary that may date quickly
and require renovation in the shorter term and secondary
positions where view line may be obscured, filtered or
built-out.
Any cautions you would attach about each suburb
(e.g. new train line coming through? Housing built on
mine shafts?? Etc)
No real cautions to be considered. These areas are well
regarded areas with strong levels of demand, and at times
limited stock available for purchase; reflecting the limited
supply for large demand leading to inflated prices.
Dural
What type, size, quality, age etc housing is typical for
this suburb?
Dural is a prestige acreage suburb situated in the Baulkham Hills/Hornsby council areas, approximately 35
kilometres north west of the CBD. Dural is characterised
by large, modern dwellings of high quality or older style
renovated, character style homes. It offers a lifestyle rural
residential choice within commuting distance of the City.
Land area and ancillaries that are usual?
Site areas in Dural are generally 2 hectare parcels with
high quality ancillary improvements including inground
pools, tennis courts, extensive general landscaping and
possibly horse stabling and paddocks. Parcels can be a
mix of fully arable and level lots to natural bush parcels.
What are the price points?
Dural ranges from entry level acreage of $1.3 million up
to and beyond $4 million for high end property. Several properties in the area would be of higher value but they
are rarely if ever released to the market.
What is the buyer profile?
Dural is popular with Executives and upper management
who are drawn to the area for the combination of privacy
and the option of entertaining on a large scale. Most are
families who wish to take advantage of the wide choice of
private schools and lifestyle options offered.
What features make these suburbs the most
expensive?
A combination of lifestyle and proximity makes this the
most expensive suburb in the North West of Sydney.
Housing options are varied and the option is still available
to purchase an older style property and redevelop into
your own dream.
Given the current climate (some returning confidence
but with interest rate rises looming), what are the
prospects for this area?
Dural has only just recovered from GFC. We have seen
confidence improve of late and the market stabilise.
Potential Interest rate rises could easily spook out recent
confidence gains.
Could you advise what might be a good and what
might be a bad investment in each location?
Good Investment - Older style properties which can be
renovated at a relatively low cost may see some capital
growth. The shape and arable nature of the parcel are
important considerations if considering the potential as
future building sites.
Bad Investment – Overcapitalising improvements
especially in regard to ancillary improvements with a
view to selling in the short term. The area also includes
overhead power lines and market sentiment at selling
time could be negative if they cross near or over the
property.
Any cautions you would attach about each suburb?
The area is serviced by local bus companies with an
emphasis on the school runs only. The majority of people
who live in the area drive and this can lead to some peak
hour congestion on the original narrow roadways.
Low Riders:
Miller
What type, size, quality, age etc housing is typical for this
suburb?
Miller is located in the local government area of the city of
Liverpool. Miller was developed between the 1950’s and
1960’s and is characterised by modest, single level fibro/
clad homes and brick veneer homes. It is approximately
35 kilometres south west of the Sydney CBD.
Land area and ancillaries that are usual?
Properties in Miller are mostly situated on 500-700sqm
blocks of land with basic landscaping and single car
accommodation.
What are the price points?
A typical Miller home can range from $270,000 to
$350,000 depending on its bedroom accommodation,
construction and internal condition.
Entry prices in Miller start at $220,000for a fibro residence
in need of renovation to the highest of approximately
$420,000 for a renovated brick residence.
What is the buyer profile?
Miller is popular with both the first home buyer and
investors/renovators due to entry point price bands. A
lot of the properties in the area are rented out to tenants
with the rental achieved relative to the condition and size
of the property.
What features/detractions make this suburb amongst
the cheapest?
Miller is situated within good proximity to the Liverpool
CBD and has established transport links. However as
much of the area is retained for public housing or held by
long term investors, a high level of tenanted properties
remain in near original condition. Local facilities would
also benefit from updating.
Given the current climate (some returning confidence
but with interest rate rises looming), what are the
prospects for this area?
Miller offers an entry level into the Sydney property
market and as more people require housing in established
areas whether as a tenant, investor or first home buyer
the supply demand will ensure slow and steady price
increases. Current rental returns are in the vicinity of
$280 to $360 per week.
Could you advise what might be a good and what
might be a bad investment in each location?
Good investment – The availability of purchasing a dated
clad home at a low price and renovating the property to a
mid standard with the prospect of re-selling for a profit or
renting out the property for a steady investment return.
Bad investment – Streets with a high proportion of public
housing could have extended selling periods on resale.
Chester Hill
What type, size, quality, age etc housing is typical for
this suburb?
Chester Hill is located in the local government area of
Bankstown City Council some 22 kilometres from the CBD.
The suburb primarily consists of a mixture of detached,
single level, fibro, clad and brick homes built between the
1950’s and 1970’s. Some spot redevelopment of dwellings
has occurred more recently with modern single and two
level brick veneer homes emerging in the locale.
Land area and ancillaries that are usual?
The average block size is around 500 sqm however lots do
vary up to around 700 sqm. Properties generally feature
large front and rear yards with basic landscaping and
detached garages.
What are the price points?
A typical Chester Hill home can range from $320,000 to
$380,000 depending on its construction, land holding
and accommodation mix. New homes built in the area
generally sell from between $550,000 to $630,000
depending on size and standard of finish.
What is the buyer profile?
Chester Hill attracts a culturally diverse population with a
large Lebanese and Vietnamese community. The majority
of home owners are families, many of which are first
home purchasers; however a significant rental market
still exists.
What features/detractions make this suburb amongst
the cheapest?
Older style dwellings of fibro/clad construction generally
define this area as an entry level point to the detached
housing market in the Bankstown City area. There is
a scarce amount of unit development in Chester Hill,
however the nearby suburb of Wiley Park provides the
most affordable unit housing in the area.
Given the current climate (some returning confidence
but with interest rate rises looming), what are the
prospects for this area?
Redevelopment of individual dwellings will continue to
occur over the long term however the first home owner
market will be dampened by the inevitable rising of
interest rates over the next 12 months. The investment
market should remain steady, supported by the relatively
good rental returns on reasonably cheap purchase
prices.
Could you advise what might be a good and what
might be a bad investment in each location?
Good Investment - Purchase of a typical weatherboard/
brick home in satisfactory condition on a large level block
for investment as a rental property should provide a good
return on a relatively low purchase price.
Bad Investment - Caution should be given to purchasing
homes containing fibro-asbestos materials which are in
poor condition, as they may attract significant costs for
removal down the track. |
