The month in review: Wollongong
By Herron Todd White
In the past 12 to 18 months the demand for vacant land in the Illawarra area has increased, with many of the new estates clearing stock which previously lay unsold after development in the mid 2000s.
The main land estates in the Illawarra are all in the south areas, with many in the Shellharbour LGA, and include Flinders, Shell Cove, Horsley, Haywards Bay, Calderwood Valley, Chapel Hill Estate, Jamberoo, Milton Brook, Tullimbar, Whistlers Run, Albion Park and Redgum Estate in Figtree.
The price points for the estates in Horsley and Albion Park are between $250,000 and $300,000. Seacrest Estate, Flinders and Haywards Bay land prices are now between $300,000 and $350,000.
Shell Cove is a relatively new beachside suburb adjoining the historical seaside village of Shellharbour, 17 kilometres south of Wollongong. Shell Cove is surrounded by some of the best surfing beaches in New South Wales in the Bass Point Reserve and Killalea State Park, with bush walking trails and a protected marine park. It has been developed by Australand over some years, with a marina now underway and a golf course already established. Recent sales indicate renewed demand after a lull in the past three to four years.
New land releases in Shell Cove (close to the new marina and harbour) are between $350,000 and $450,000. The new releases are only available by ballot and all are selling at auction.
Overall land sales are very strong across all these land release estates. Many are selling off the plan prior to registration of the Deposited Plan while the subdivision is still under construction, a complete turnaround from three to four years ago when developers struggled to clear serviced lots. For instance, all three stages of lots in the new Alkira estate in Horsley near Dapto have sold and it is currently undergoing servicing. Asking prices increased from around $230,000 in stage 1 to $290,000 in stage 3. It remains to be seen whether the developed product will be equal to land plus construction cost in an on sale of the new dwelling.
Redgum Ridge is a residential subdivision located in Figtree, just to the south of the CBD, a well established suburb developed in the early 1960s with good infrastructure such as schools and shopping. The subdivision consists of 193 lots that will be developed in a total of 15 stages. Recent sale rates generally range from $300,000 to over $400,000, however higher prices have been achieved on lots featuring better aspect and outlooks. Take up appears to be increasing after slow sales during the past three to four years.
Interestingly, as a result of a change in zoning laws, the Seacreast Estate in Flinders near Shell Cove now allows duplex sites on almost all blocks in the estate. Generally, blocks with a land area of 500 square metres can now be subdivided into a duplex site subject to approval. In effect this should push land prices up in this area.
As indicated above, supply is currently struggling to meet demand for vacant land sales in these new releases. The government incentives for building new homes (stamp duty, etc.) and first home buyers grants combined with low interest rates are continuing to buoy up demand and prices for vacant land.
In fill sites are rare. Generally the highest priced land is located in the northern beaches from Bulli to Stanwell Park. Ocean views and direct beach access naturally score the highest prices.
Vacant residential land for single use residential do sometimes sell, although they are somewhat of a scarce resource across the well established northern suburbs of Wollongong. Vacant land sites are generally sold as one off blocks and often at a premium.
Values range widely depending on the location and specific characteristics of each lot and locale, but we see in our patch that potential redevelopment sites are generally starting to attract greater interest from small developers and mums and dads.
We saw this pattern in the early to mid 2000s as market values increased. Any lot with a good frontage and generally over 700 square metres is being sought after particularly if the improvements add little value.