The month in review: Newcastle

By Herron Todd White
September, 2009

The above statistics on house sales made within the Newcastle and Lake Macquarie Local Authorities show that after a lull in 2008 house sales have again strengthened in 2009. This strengthening is largely due to the increase in activity at the lower end of the market
that has been primarily driven by the doubling of the government’s First Home Owners Grant. We have seen houses sale volumes below $500,000 increase from 1,058 in the first quarter of 2008 to 1,369 in the first quarter of 2009, however there has been no increase in the middle market and the prestige market has seen volumes fall from 36 in 2008 to only 16 in 2009.

It will be most interesting to see where sale volumes go in the first quarter of 2010 when the First Home Owners Grant returns to $7,000. We would suggest that sale volumes will fall, particularly in the sub $500,000 price bracket, and we may see median values also fall. The
governments desire to see the increased activity in the lower end of the market transfer through to increased sales in the middle market has not occurred and we can only guess as to what may occur in the middle and prestige house markets.

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