Wollongong

The Smartline Report – November Edition

The month in review: Wollongong

By Herron Todd White
November 2016

Due to the strength of the residential property market in the Illawarra, small infill developments are currently more feasible than ever, in fact quite lucrative for owners where development is possible. The most common small scale development is a dual occupancy, often with Torrens or strata subdivision.

We are noticing two types of dual occupancy. The first is typically an older established dwelling on a larger block around 700 to 1,200 square metres and with a frontage over 16 metres. R1 or R3 zoning makes council approval easier. The current house is kept as is and a new detached dwelling is constructed at the rear of the block. Usually a garage or other site improvements need to be demolished to allow for construction of the new dwelling. Illawarra suburbs where this is prevalent include those close to the main CBDs such as Fairy Meadow, Coniston, Bomaderry and Nowra.

The second type of dual occupancy is the construction of a new duplex pair. This can involve the knock down and re-build of an older dwelling in an established area or allowable construction in a new estate. These blocks of land (or older houses) with dual occupancy potential are often purchased by small scale developers, with both duplexes sold individually once construction and subdivision are completed. This type of dual occupancy is widespread in recent land subdivisions in Lake Heights, Berkeley, Flinders, West Nowra and South Nowra.

There is currently strong demand for new properties which is driving up prices of duplex properties, thereby increasing developers’ profit margins. A ten year old, semi-modern duplex recently sold in May 2016 for $564,000 after the vendor had purchased it in March 2015 for $462,000 – an 18% increase in just over one year. Where possible, developers are best to hold off selling their new constructions for as long as possible while prices continue to increase rather than selling them off the plan early on in the project.

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Please note that information in this publication is subject to change without notice. Smartline assumes no responsibility for any errors, omissions or mistakes in this document. © Smartline Home Loans P/L 1999 – 2016. Australian Credit Licence Number 385325

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