Across the Wingecarribee Shire, the annual median price to October 2016 increased 20% to $648,000 on 19% less volume of sales (1,713). This is in contrast to our expectation that the market would remain steady and sales activity remain constant, however it is reflective of what local real estate agents have been saying for the past six months – there is a lack of listings.
We did predict at the beginning of the year that renovation and extension activity in well located, older style and character homes within the townships would increase and that has been the case.
The chart below summarises price movements over the past year.
Strong growth across the region in general is evident, particularly those suburbs and precincts located close to townships and established infrastructure. What is also apparent is the variance in the market outside the townships. Exeter for example, comprising residences on 1,000 square metres to two hectare blocks, located approximately 20 minutes from Moss Vale has been flat for the year, while Sutton Forest, traditionally rural lifestyle properties of up to 40 hectares has seen strong growth over the same period, albeit on a very thinly traded and volatile market.
Goulburn Mulwaree annual median price to October 2016 increased 10% to $340,000 on 17% less volume of sales (1,013). As the economic centre of the Southern Tablelands, Goulburn is in a good position to see a strong 2017 in terms of residential growth with stable employment anchored by education, health, Corrections Centre and the Police College.
In the past six to nine months, Goulburn residential prices have strengthened and demand is strong. Local agents are reporting increasing interest from Sydney and Wollongong investors seeking a reasonably priced investment in a strong city with good rental returns and who are continually priced out of their own local markets.
Land prices have increased to the point where it is difficult to find anything for sale under $200,000. We are also seeing some buoyancy in rural resilient residential properties within a short driving distance of the city’s facilities.
This column, by necessity, is going to be towards the briefer end of the spectrum for Month in Review prognostications. We are absolutely inundated at the moment with valuation requests which is indicative of a market at the very height of its cycle. This should tell you enough about the strength of the current market right there. An appropriate word might be bullish. Buoyant would also get the job done. End of column……
Fleshing things out slightly and putting this in parlance that might resonate with property novices, we could liken the present market to the All Blacks a week before Ireland came along, cruising along in battle formation, unswayed by outside influences. If rugby is not your thing, maybe a summer sport would work – an Australian cricket team led by the relentless Steve Waugh simply uncaring about opposition teams, media or game plans. There is only one goal and no deviation from the task at hand is acknowledged or accepted. Outside influences do not exist.
Maybe sport doesn’t interest or excite you. You might be more engaged in politics. If that is the case maybe we could see some parallels between our current market and (the writer pauses and ponders the ramifications of writing about politics for a brief period before continuing on…) America a week before the election of a new President. Think back to the collective thoughts of media, pundits and even politicians at the time. They all knew one thing and that was a certain outcome was all but assured. There was massive momentum for this outcome and it didn’t look like anything could stop it. No one thinks Month in Review December 2016Residential 32 the market here in Newcastle is going to slow down either… Any brave souls out there?
The above scenarios are all examples of absolute juggernauts that steamroll everything in their paths, with nary a flicker of emotion or remorse – the All Blacks are renowned for their merciless efficiency, whether against the historic foe or newer upstart pretenders. So too the mid 90s Australian cricket team which was equally as ruthless, taking pride in not removing their foot from even the most helpless opponent; in fact, squeeze harder was their mantra.
The housing market in Newcastle is not too dissimilar to these behemoths – large, powerful and showing no mercy to those not at the top of their game. If you are in the market for a new home or an upgrade, you need a few things on your side. You need to be able to move fast. This writer recently saw a clip on the Galapagos Islands where a single iguana was being pursued at every turn by a large pack of snakes lying in wait. The lone iguana was twisting and turning in an attempt to outrun the devious snakes. In order to escape the snakes there was a mix of frantic energy and cold calculation. Our market appears like this sometimes – in order to purchase a property, often a premium is required to be paid and it needs to be paid quickly to avoid gazumping. You need to be calculating and frantic.
One thing is interesting and worth thinking about with these three separate examples.
The All Blacks lost to Ireland and their world record winning streak is over. The streak will have to start again. You have to start at one win.
The invincible side of Steve Waugh is all but a distant memory with the Australia cricket team in the midst of its worst slump in three decades.
The Democrats lost the election to the surprise of absolutely everyone, including it appears the President Elect.
These factors illustrate the fact that good times never last, things are cyclical and it’s best not to crow too much when on top as you are likely to hear about it on the way down.
Yes, the market is hot right now and we would question whether now is a good time to buy a property. If you do you are likely to pay more than it’s worth. Only time will tell whether the price you pay now is cheap in 12 months time.
NSW Central Coast
One word sums up the real estate market on the Central Coast in 2016 – smiles.
Smiles all round in fact. Sellers were very, very happy. Buyers were very relieved to become part of it. Real estate agents were run off their feet. Record volumes were seen, it was a very solid year for auction clearances and lenders were struggling to keep up with demand for new loans.
Many suburbs have been revitalised, some continuing on from the previous year and a few bloomers.
By far, there have three star performers in the region – Umina Beach, Erina and the unit market.
Umina Beach and its immediate neighbours Woy Woy and Ettalong Beach had a cracker of a year with a huge volume of sales and ever increasing values from start to finish. For these areas, 2016 was a continuation of the previous record year. At the beginning of 2016, we couldn’t see how the record sales and volumes could continue – but they did.
Erina, sitting between the Gosford business hub and the cool beachside suburb of Terrigal also had a very good year with an inexplicable rise in popularity and significant value rises.
At the beginning of the year we predicted the rise in the number of new residential units. While mostly concentrated in the Gosford CBD, this part of the market has been very impressive. It has centred around good quality construction and finishes in equally good positions. The developers of these units are known for their astuteness, care and attention to detail in terms of what the buyers want and not what the developers want to give them – a common mistake made in previous property cycles. Pre-sale numbers have been impressive to say the least and pleasingly, local buyers have been seeing the value in these units as much as buyers from outside of the area.
We also thought there would be a few more standouts and whilst they did perform, it was a little less than we thought. Narara and Niagara Park saw a good level of turnover, but the numbers were a little lower than expected. To the north, the newer suburbs of Woongarrah, Hamlyn Terrace and Wadalba also continued on from last year. The majority of sales in these areas appear to be for house and land packages by a few builders. We think these are reasonably good value, but noticed a bit of inconsistency occurring in pricing levels.
Do we think there have been any weak suburbs? Well not really, the numbers suggest a pretty good year across the region, but some areas thought to be on the verge of making good ground on rising values didn’t quite get there. We are talking about Avoca Beach, an iconic coast location which has always enjoyed a reputation of the place to be. It just cruised with an adequate number of sales, but far from the impressive numbers we were expecting. We also think that Bateau Bay, historically another place to be, didn’t quite perform as well as expected.
Here on the Central Coast, we have always taken life as it comes – a few raised eyebrows here and there, but mostly laid back when something big occurs. But this year, there was a sense of urgency and anticipation across many sectors and segments of the market and we think the enthusiasm from those coming into the region this year has infected us all – and that’s a good thing. If we had to describe a big event that shaped the region, it would be the shake up in values caused by those coming into the area. Everyone has been a winner – buyers squeezed out of the Sydney market finding the home of their dreams in a beautiful setting and sellers having good reason to smile. We hope to see more of it next year.
Throughout 2016 there has been a noticeable increase in land values and demand for vacant land. With 14 subdivisions currently underway in Tamworth the market has responded well to the increase in available land, in both the investor and owner-occupier markets. As predicted the market for established older homes has softened slightly with people looking to build rather than renovate. This has caused a drop in prices for established homes, allowing first home owners and those looking for cheaper houses to get into some good properties for cheaper than previously available. The tightly held patches of East Tamworth and parts of North and West Tamworth continue to trade well with demand for Federation style houses in these locations still strong.
With an increase in investors building in Tamworth, we have seen an increase in the supply of duplexes and smaller townhouses. This has weakened the unit market which was traditionally targeted by investors due to government incentives to build new dwellings and the ability to then receive two rental incomes from one property.
The expanding of the local abattoirs and poultry industry has seen an increase in people moving to Tamworth looking for work, which in turn has seen the traditionally cheaper rental markets of Westdale and Oxley Vale become more attractive to purchasers.
The upgrade to the Chaffey Dam has added some security to the town’s water supply, which in the past has been on the low side.
Overall the market reacted this year as we thought it would with no major impacts and the market continuing to firm.
Our predictions for 2016 proved to be mostly correct with a divide occurring between new and established homes. The increase in vacant land values and demand was also predicted. It was also noted that the inferior subdivisions being targeted by investors may have a slightly negative effect on the surrounding suburbs, which we have seen as owner-occupiers look for houses away from these developments.
With Tamworth being a relatively cheap market any property selling for over $1 million is a special property. In May this year, 163 Brisbane Street, East Tamworth sold for $1.2 million. This renovated and extended Federation style home on a massive block in prestigious East Tamworth with extensive grounds, pool and tennis court was the top priced residential sale for 2016 in Tamworth. Another property currently under contract for $1.1 million is 51 Raglan Street, East Tamworth and is another example of how a well renovated Federation home in East Tamworth can achieve a high sale price.
The overall market has been positive during 2016. The slow down in mining has caused downward pressure in some affected areas. Sales listings are in demand for small acreage and properties in established residential areas are experiencing some improvement. New subdivision lot prices have been steady in Orange with some further gains in Bathurst. Sales periods have shortened over the year for well priced properties. Increased investor interest in Lithgow, Bathurst and Orange has been a highlight of the year.
While the property market has shown relatively little volatility the same cannot be said for rainfall in the area. The year started out hot with an extended dry period and has ended with one of the wettest winters on record. The Central West is covered in a lush green cover and makes for a pleasant drive or bike ride. This has been good for the agricultural sector which is always good for the market.
There have been continued efforts on many levels this year to send the message that all the services you would expect in an urban area can be found in our regional centres, along with the benefits of the lifestyle on offer. The improving road network to Sydney, the South Coast, Canberra and Melbourne has helped the region to tap into some of the flow on effects of the booming prices in those areas.
Setting the pace is a centrally located 955 square metre vacant battle-axe block with expansive views at 135A Hope Street, Bathurst. This sold in September for $310,000. If a bit more land is your thing, a one acre block on the fringe of Orange at 5 McCormick Place sold in August for $315,000.
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