The lure of coastal views and golden beaches continue to attract buyers as households seek lifestyle changes during the pandemic.

New data by realestate.com.au tracking the search activity of ‘highly-engaged’ or serious buyers showed a strong preference for bigger homes in outer suburbs and suburbs located near the sea.

Senior economist at realestate.com.au Eleanor Creagh said hybrid working models have allowed workers to relocate further away from the city centres.

“With proximity to the CBD no longer being such an issue many can seek relative affordability and more space in outer suburbs,” Ms Creagh said.

Beachside living and commutability has driven demand in the Mornington Peninsula. Picture: realestate.com.au/buy

Government schemes like HomeBuilder also boosted demand for new homes in development suburbs during the pandemic.

Berwick on Melbourne’s outer fringe was the most in-demand suburb nationally, with 47,498 highly-engaged buyers searching for houses in the area over the 12 months to August.

“Berwick has a country style, with spacious homes and gardens, but is still close to the freeway and not too far from the CBD making a hybrid working environment achievable,” Ms Creagh said.

Use the interactive below to see how well your suburb has performed over the past 12 months.

A highly-engaged or serious buyer is someone who is likely close to making a purchase, based on their activity on realestate.com.au.

The COVID-fuelled shift towards hybrid working also boosted demand for coastal centres that are still within commuting distance to the major cities.

Buderim on Queensland’s Sunshine Coast was the second most in-demand suburb, with 45,065 highly-engaged buyers looking for houses in the family-friendly suburb in the year to August.

Coastal areas in Greater Melbourne – which has endured the nation’s longest lockdowns – were also highly sought-after with Frankston (41,370 highly-engaged buyers), Mornington (35,470), Mount Martha (35,422) and Brighton (33,965) all featuring in the national top 10 most in-demand suburbs.

“For Melburnians, now in their sixth lockdown, living situations are being readily reassessed after so much time at home,” Ms Creagh said.

“Suburbs in the Mornington Peninsula have proved popular for those buying holiday homes, but also are not too far from the CBD making a hybrid working environment favourable,” she added.

Ms Creagh said the pandemic had not only driven demand for lifestyle locations, but also for more space, with the data showing a preference for homes with four bedrooms.

“People are reassessing their lifestyles during the pandemic,” Ms Creagh said.

“Maybe a year locked up in an inner-city apartment is not particularly appealing and they’d rather more space for a home office, a garden and space to do things at home and enjoy their home,” she said.

Four-bedroom homes in Sydney’s Kellyville were highly sought-after in New South Wales, with 38,914 serious buyers seeking a house in the area over the year. Located approximately 36km north-west of the CBD, Kellyville offers a lower price point than suburbs closer to the ocean.

Baldivis on Perth’s outer fringe was the most in-demand suburb for houses in Western Australia with 16,674 highly-engaged buyers, followed by beachside Scarborough where 16,452 serious homebuyers were looking.

Adelaide’s Prospect, known for its leafy streets and character homes, was the most in-demand suburb (18,951 highly-engaged buyers) across South Australia, followed by Happy Valley (18,461).

Character homes in Adelaide’s Prospect were highly sought-after. Picture: realestate.com.au/buy.

Hobart’s Sandy Bay (13,612 highly-engaged buyers) was most popular with serious homebuyers in Tasmania, while Kambah was the most highly sought-after suburb for houses in the ACT, with 6,310 highly-engaged buyers.

Darwin’s Durack led the Northern Territory with 4,034 highly-engaged buyers.

Queensland lures in interstate buyers

Buyers are flocking to the sunshine state en masse to escape lengthy lockdowns along Australia’s south east.

Ms Creagh said regional Queensland had recorded the largest net inflow of people of any state or territory during the pandemic, while Sydney and Melbourne recorded large net losses.

“Many people have not only chosen to escape lockdowns but also seek relative affordability in Queensland,” Ms Creagh said.

“They’re seeking more sun, less lockdowns, less traffic and have the potential to upsize or upgrade their abodes with the Queensland market remaining more affordable relative to other east coast capitals,” she said.

Homes located on Queensland’s Sunshine Coast and Gold Coast were highly sought-after. Picture: realestate.com.au/buy

The most in-demand suburbs in Queensland were in the state’s south east, with seven out of the top 10 located on the Gold Coast.

Local real estate agent Emma Gregory from Amir Prestige said buyer demand had surged over the past 12 months, which was driving up prices.

“There’s just not enough properties on the market to satisfy that buyer demand,” Ms Gregory said.

“The last 12 properties I have sold have all been street records.”

Ms Gregory said interest from interstate buyers had grown considerably during the pandemic.

“Interstate buyers are seeing value for money here on the Gold Coast. They can get beautiful homes on great sized blocks close to the beach or offering an acreage lifestyle,” she said.

“I have sold a number of properties to interstate buyers who have been unable to inspect the property in person and bought after a video FaceTime call, or had family or friends look on their behalf.”

The waterfront property at Clear Island Waters has had more than 70 inspections. Picture: realestate.com.au/buy.

She said a waterfront property in Clear Island Waters, going to auction this weekend, had already had more than 70 inspections during the three-week campaign.

“We’ve been inundated with enquiries, both local and interstate,” Ms Gregory said.

Queensland properties also recorded strong growth in demand from highly-engaged buyers, with demand up 165% in Far North Queensland’s South Mission Beach over the year.

Mount Barker in Western Australia’s picturesque Great Southern region recorded the strongest growth in demand nationally over the year.

In the unit market demand was concentrated towards capital city centres, which Ms Creagh said was largely due to the fact that CBD markets have a greater supply of apartments.

Melbourne was the most sought-after suburb for units, with 62,304 serious buyers looking in the area over the year.

Known for its skyline of high-rise apartments, Surfers Paradise was the second most in-demand for units nationally with 51,676 highly-engaged buyers.

“Again, this would be backed up by those northbound migration trends as well as relative affordability to income,” Ms Creagh said.

Low borrowing costs boosting demand

Record-low interest rates have driven demand for housing during the pandemic, with high-intent buyer activity on realestate.com.au hovering near record levels for several months.

The Reserve Bank of Australia cut interest rates to a record low of 0.1% in November 2020, where they’re expected to remain until at least 2024, a move the bank acknowledges has supported property prices.

Record-low interest rates have driven property prices higher. Picture: realestate.com.au/buy.

Addressing an online conference on Wednesday, RBA assistant governor for financial stability Michele Bullock said household debt levels were accelerating with prices.

“Low interest rates are clearly an important factor, making it easier for households to service their debt and changing the trade off on whether to rent or buy,” Ms Bullock said.

“In this environment it is unsurprising that housing credit growth has picked up and the rapid rebound in loan commitments suggests some further pickup in growth to come,” she said.

Ms Bullock said credit growth, which calculates the change in outstanding balances on home loans, is currently running at an annualised rate of around 7% but would likely run into the double digits next year.

“Recent data on [loan] commitments, combined with several assumptions, suggest housing credit growth could peak at an annualised rate of around 11% early next year,” she said.

Financial regulators are monitoring for signs of deteriorating lending standards. Picture: realestate.com.au/buy.

RBA governor Philip Lowe recently said financial regulators would consider it ‘problematic’ if housing credit growth consistently ran at in the double digits while income growth was running at 4 or 5%’.

“At some point, APRA would be considering interventions,” Mr Lowe said in July.

The latest national accounts data from the Australian Bureau of Statistics showed gross disposable incomes grew by 4.1% through the year to June. Disposable income factors in earnings from wages as well as other sources of income such as business profits, investment income and welfare payments.

Mr Lowe has ruled out using lending restrictions as a tool to cool house prices, but said regulators will act if lending standards deteriorate. For now, he said they remain sound.

Ms Creagh said the benefit of lower interest rates have already been converted into higher prices, which was putting a squeeze on first-home buyers.

“That price increase is no longer being offset by lower mortgage rates, and we’ve had the end of HomeBuilder and other kinds of government initiatives, so that’s meant that first-home buyer activity has dropped off slightly,” Ms Creagh said.

Surging property prices are squeezing first-home buyers out. Picture: Getty.

REA Group Broker CEO Susan Mitchell said the hardest thing for aspiring homebuyers was the speed at which house prices were rising.

“In the June quarter we have seen the biggest increase in property prices in the major metropolitan areas since they started tracking it, so that’s 6.7% according to the Australian Bureau of Statistics,” Ms Mitchell said.

“The speed with which those prices are increasing is going to make it harder for first-home buyers. We’ve also seen a return of investors into the market which might also be challenging for first-home buyers.

“The other thing that’s going to be a little discouraging for first-time buyers at this point in time is some of the grant programs are coming off that were related to COVID.”

Ms Mitchell said first-home buyers can still tap into state and territory government grants and stamp duty concessions to help them get into a home sooner.

“There’s no indication anytime soon that the RBA is actually going to raise interest rates,” Ms Mitchell said.

“You can still get a great fixed rate under two years for under 2%. You can get a great variable rate in the low twos, but you really need to do your shopping, which is a great reason to talk to a broker.”

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