Regional NSW

The Smartline Report – September Edition

The month in review: Regional NSW

By Herron Todd White
September 2015

Southern Highlands

The Southern Highlands and Wollondilly residential property market prices are increasing. Over the past 18 months, this is most apparent in the lower to middle price bracket (under $1.5 million). Selling times have reduced dramatically. There have been marked increases in both volume and value across all of the townships and villages of the Southern Highlands. The main market drivers are the low interest rates and Sydney based buyers having a tree-change and relocating to the Highlands region.

Traditionally there have not been many residential unit developments in the Highlands. The preference was for new housing on the fringes of towns and renovating well located older style cottages. Most strata title properties are villas and townhouses with the occasional residential unit development. Of note over the course of 2015 is the anticipated release of planning revisions by Wingecarribee Shire Council that will allow for further density in town centres. This should see an increase in medium density development in towns like Bowral, Mittagong and Moss Vale over the medium term. These planning revisions are well timed, with many retirees moving to the Highlands and the demand for low maintenance seniors living and medium density properties is increasing.

Most semi-modern to modern townhouses and villas range between $450,000 and $750,000. There are also some older 1970s and 1980s townhouses and villas that range between $360,000 and $450,000. In general, we find that attached housing living areas tend to be getting larger over time.

There has been an increase in investor activity generally. The prestige and upper end of the market (over $2 million) is steady and some caution is still evident in buyers.

Southern Tablelands

The regional city of Goulburn is steady to firming. There is a current flurry of Sydney investor activity that is driving a small increase in prices. Rental levels have actually reduced slightly over the past six months as more rental properties come onto the market and some tenants have returned to the Canberra area. Again, there has been a preference for Torrens title properties rather than residential units in the Tablelands. There are some semi-modern and modern townhouse and villa complexes. Prices range from $250,000 to $380,000. There are some older style unit buildings, with units selling in the $180,000 to $250,000 range.

The Crookwell village market is steady. The rural residential property market has also been stable.

NSW Central Coast

As the location of the railway station and shops, the Gosford CBD holds the largest portfolio of 2 and 3-bedroom units and apartments. Enjoying the current demand levels being experienced in the nearby Sydney market, there has been an increased demand for units and this is evidenced by the number of recently approved new developments. We have estimated that the council has given its approval to around 787 apartments in the recent past.

For an area the size of Gosford, this number of approvals is quite significant and indicates a level of confidence of investors in the area that has been missing for many years. Should these approved projects proceed, the landscape of Gosford will be changed forever as new residents move into the city centre and the local economy flourishes as a result.

Of course, it is hoped that the developers time their commencements and completions appropriately to avoid the sudden oversupply situation seen previously which caused lasting damage to the local unit market.

Away from the city centre, units and apartments are also popular in the peninsula areas of Woy Woy, Umina Beach and Ettalong Beach, although units more so around Woy Woy due again to the presence of the railway station and large shopping centre.

Villas and townhouses are more popular within the other peninsula suburbs and have been for many years.

Prices of units are fairly stable at present at around mid $300,000 for an older unit close to the station and shops. The surprise packet in pricing terms is with new villas in Umina Beach and Ettalong which are regularly achieving over the $600,000 mark.

The beachside suburbs of Terrigal and Avoca Beach also have a number of unit and apartment complexes. These units cater to the holiday market and those wanting to live near the beach and café scene. Price points vary considerably from mid $400,000 to over $3 million.

We are aware of the practices in the Sydney market of developers adjusting unit sizes to satisfy the demand of potential purchasers. We would like to think on the Central Coast that we are insulated form this practice and our experience has shown that local developers would rather produce a quality product over quantity. The difference is quite obvious when non local developers enter the market. The 1- and 2-bedroom sector has been growing however it is far from being out of hand. What we are finding is that new 1- and 2-bedroom apartments are also growing in square metres over existing older apartments. The Gosford CBD proposed developments have seen high demand in the past months with whole allocations selling off the plan. While larger tower style buildings incorporating mixed uses have been approved, this is new for the area and it remains to be seen whether they will be accepted. It is our view that acceptance of this product will most likely be from buyers new to the area and international buyers.

Possibly due to the long absence of new unit developments, we are seeing levels of off the plan purchases. This is particularly from foreign and out of area investors. It would appear to be sustainable in the short term, however, once a supply point meets market demand, it’s anticipated to flatten out to a more stable market.

We hesitatingly say the best opportunities in attached housing in the area at present would be the Gosford CBD due to the new developments coming to the market. It is anticipated they will offer a good standard of living with transport and shopping facilities at the door. Prices for these new developments are yet to be confirmed, but indications of pricing levels we have heard for some new developments will need reviewing as the commencement of marketing draws closer. It is accepted that market values are rapidly rising at present, but we doubt the Gosford market is ready for some of the prices being bandied about and if these price indications are realised, then we doubt that their long term sustainability can be guaranteed through any market correction periods.

Away from the Gosford CBD, the beachside suburbs nearly always deliver on value for money and rather surprisingly because the rapid rise in values has been a little slower in reaching these markets, we see good value and sustainability.

Continuing with the sustainability of values theme, the peninsula areas of Umina Beach, Ettalong Beach, Woy Woy and Booker Bay have been in continual growth mode for several years. While we could not say that values have been behind in these areas and thus needing a growth period, the level of growth here has been a real surprise and streaking well ahead of most other local markets. While largely driven by non-local buyers and opportunism, it is hard to imagine the medium to long term sustainability of values as a sure thing.

NSW Mid North Coast

This month we are looking at the unit, apartment, villa and townhouse market along the mid north coast.

These areas are within close proximity of shopping, public transport and often patrolled beaches.

Within these areas unit buildings range from the modern multi-storey high-rise complexes to older style walk-up complexes of up to three storeys.

The older units are generally of 2-bedroom design and lie within the $200,000 to $350,000 value range. Units within this segment have been predominantly purchased by investors and the tight rental market is continuing to drive this segment, with these properties showing good returns at present and having the potential for good capital growth over the next few years.

The more modern units, located in the highrise complexes, are often 3-bedroom, 2-bathroom design and are centrally located close to the town or beach and local facilities. The have a wide value range of between $400,000 and $1 million, with a larger percentage of owner occupiers than the older investment units. These more modern larger units are also showing good rental returns, although at inferior rates to the lower value segment and have potential for good capital growth over the next few years.

Strata villas are more often found in the established residential areas within the towns along the mid north coast. They comprise a mixture of owner occupiers and investors and are usually of 2- and 3-bedroom design. Capital growth has been good for this type of property in the larger towns and rental returns has increased rapidly in certain specific areas (such as the western areas of Port Macquarie adjoining the new proposed university).

Townhouses comprise only a small segment of the market compared to units, apartments and villas. They are less appealing to older owner-occupiers and show inferior capital gains to comparable value units and villas.

There has been no construction of large unit developments within the major towns of the region over the past five years, however recently a development application has been approved for a new multi-storey unit development within the Port Macquarie CBD.

The unit, apartment and villa sector on the mid north coast is still in a state of growth, however rates of sale and increases in values appear to be slowing and steadying somewhat of late and we expect this to continue over the next few months.

Coffs Harbour

Being a regional centre, Coffs Harbour has a limited number of attached housing options. These include standard duplex, villa and townhouse units in the suburban localities and low to medium rise unit buildings within the more sought after beach or harbour side areas. Typically the suburban localities comprise five to 30 year old low rise units providing 2- or 3-bedroom accommodation ranging in price from $200,000 to $400,000.

The more popular beach and harbour side suburbs see prices ranging from $350,000 to in excess of $1 million with average prices typically being around $450,000 to $700,000. The diversity of product within these areas ranges from 20 to 40 year old low rise complexes to modern high quality medium rise product with extensive water views.

The high end of the market of $700,000 plus does see sales dramatically reduce due to limited local demand for this price range. These units are generally purchased by high net wealth individuals with long selling periods required to attract potential purchasers.

The recent upturn of the market has seen increased construction of new unit developments which have been noticeably absent during the GFC period. Park Beach, located four kilometres north of the CBD, has seen considerable new unit product predominantly targeting the affordable end of the market.

Several modern townhouse complexes have been constructed which generally provide 3-bedroom, 1- or 2-bathroom accommodation in complexes of five to ten units ranging in price from $350,000 to $400,000. The majority of purchasers have been investors with rental returns of $360 to $400 per week being achieved. There are a percentage of out of town buyers for this product, however prices are generally supported by sales of existing product.

Park Beach has also seen the construction of a new medium rise building (nine storeys) opposite the landmark Hoey Moey Hotel with 2- and 3-bedroom units ranging in price form $500,000 to $900,000. The medium rise product is very limited within Coffs Harbour with only a handful of buildings all located along Ocean Parade at Park Beach, the highest being 15 storeys.

Another notable area of new development is the popular harbour or jetty precinct located two kilometres east of the CBD. Several low to medium rise complexes are being constructed or due to start construction shortly which provide varying accommodation from larger complexes with 1-, 2- and 3-bedroom holiday style accommodation to larger 3- and 4-bedroom units in smaller boutique buildings.

Typically it is the affordable end of the market which sees the majority of activity in Coffs Harbour which is reflected in the current median unit prices of $180,000 (1-bedroom), $225,000 (2-bedrooms) and $340,000 (3-bedrooms). There are encouraging signs with the amount of new product currently being constructed giving a wider variety of options for the owner occupier or investor. The local market thins dramatically as the price increases above $500,000 with the sustainability of the high end value units ($700,000 plus) dependant on the greater economic climate at the time of sale. We caution this is a more volatile market with the most likely buyer being a high net wealth individual. The number of such buyers is limited in the local market with prospective purchasers most probably coming from Sydney or interstate.

NSW North Coast

Clarence Valley

Residential units in the Clarence Valley are mostly found in the regional centre of Grafton and the coastal tourist town of Yamba. The unit market situation within these two towns is like chalk and cheese. Interestingly while Grafton has a larger population, Yamba saw double the strata sales since January 2014 compared to Grafton. In Grafton units start from $50,000 for a basic 1-bedroom apartment and range up to $350,000 for a brand new 3-bedroom villa. This market is mostly driven by investors and owner occupiers. In Yamba units are sought after by holiday renters and capital city owners who seek the beach lifestyle and ocean views. Units in Yamba start at $200,000 for a 2-bedroom townhouse up to $1.34 million for an ocean front 4-bedroom apartment. The NSW RMS has proposed a new highway nearby Yamba and Grafton which is expected to drive demand for units in the area. Once the highway begins and more workers come to the area there may be a lack of housing, placing upward pressure on units and rentals.


The existing residential unit market in Lismore City, and to a smaller scale in Casino and Kyogle, is typically characterised by brick and tile construction, built within the 1980s or 1990s. This particular era was generally represented by simplicity of design and function, and units are usually single level, comprising 2-bedrooms, 1-bathroom/laundry, combined living and dining area and an attached carport or a single lockup garage. There are a number of three or four level apartment blocks and attached townhouse developments (constructed towards the middle and latter part of the 1990s), however the bulk of the existing residential unit stock is single level.

Depending on location, quality of PC items, body corporate financial position, whether renovated or unrenovated, the market value range for this humble accommodation type under current market conditions can vary from $150,000 to $275,000 in Lismore City and $100,000 to $200,000 (average) in Casino and Kyogle.

Naturally, there are some outliers, but anecdotal and available sales evidence suggest higher prices are achieved for units close to the CBD and service facilities such as shopping, hospital and major shopping centres.

Off the plan unit developments are rarely entertained in Lismore City, Casino or Kyogle compared to the more coastal based communities of Ballina and Lennox Head as there is still, traditionally, a stronger local market sector seeking standard house and land packages. However, we are aware of some enterprising proposals in the pipeline for the local region (Goonellabah) that could provide some impetus in the investor or price conscious owner occupier market with interest already shown in some pre-sales for a contemporary style apartment proposal situated within a holistic or community living inspired design layout with community gardens, parking and on-site manager.

This is still a relatively untested market for Lismore City, but signs are encouraging as more modern price conscious real estate products are made available to the general public locally and abroad.

In the past ten years, there has been a preference for new residential unit development to be dominated by the higher quality, attached or detached (free standing), duplex style residence, typically comprising 3- or 4-bedrooms with 2-bathrooms and a double garage ALL situated on a smaller site, therefore eliminating (in theory) a high level of maintenance with smaller yards, limited lawn space and smaller, intimate garden areas. For the timepoor owner occupier and tenant, such a real estate product provides a similar quality of living space but just on a smaller site.

In some cases, a body corporate structure could be minimised with each free standing duplex having separate insurance policies and possibly no sinking fund fees. This is usually achieved by utilising a corner parcel of land that enables separate town water and sewerage, mains power connections and separate driveways, thereby eliminating any common or shared areas.

As such, the sales prices achieved for this seemingly popular investment real estate vehicle of late can range form $350,000 to $450,000 within Lismore City and $250,000 to $350,000 in Casino or Kyogle. Recent policies adopted by local authorities have given some encouragement to the budding small developer, in particular, Clause 4.1C under the Richmond Valley LEP 2012 for the Richmond Valley area and Policy 5.2.32 from Lismore City Council for the Lismore City area. These are worthy of a read for any small time developer who may have a vision for a vacant parcel of land or a parcel of land with a house and large backyard (granny flat anyone?).

In summary, there are encouraging signs of interest in attached housing, particularly now that we are living in an era where price is very sensitive to the dynamic challenges and shifts in society and the market is having to adjust to the changing demographics of the populace i.e. larger families are becoming an increasingly rare species and single living is deemed to be more acceptable nowadays. Hence, the provision of market appropriate real estate products is always a challenge to predict ahead of time.


Single level 2-bedroom units situated on Ballina Island are the most popular in the area. This is due to the older demographic who are buying to downsize to a low maintenance home. As this immediate locality is generally level it makes it an easy walk to local amenities. In general the housing market is considered superior in popularity for first home buyers. In some instances units are used as a first purchase but this is a last resort option because within the years to come they are looking to upsize. Units within the East Ballina area are popular with investors who can see a good rental return. This locality is one of the top three in the Ballina area. Some investors use this as income potential but also have the option to retire close to the beach in years to come.

Lennox Head, Byron Bay, Mullumbimby, Ocean Shores

Attached housing in the areas of Lennox Head, Byron Bay, Mullumbimby, Ocean Shores and the like is considered as strong and in demand. Interestingly the market for 2-bedroom units on the flat and level town area of Lennox Head has seen an increase in demand and made developers re-think design options before turning soil. The unit stock in all of these areas seems to be limited and demand considered as high. Pricing points vary across all areas however with the limited stock available interstate buyers who are used to smaller land areas (say from the suburbs of Sydney and Melbourne) still find duplex units and townhouses with yard space attractive and not overly different to the overall land areas they were used to.

Off the plan purchases are still at a minimum and agents are reporting they are hard to convert into sales until the finished product is near fully complete.

Ocean Shores and surrounds is considered a good opportunity. The buy-in prices are relatively cheap when compared with the larger resort townships of Byron Bay and Lennox Head. The rents achieved in Ocean Shores also make it appealing if an investment driven purchase.


Units and attached houses form a minority in the local market, however the stocks of such housing continue to increase in line with demand. Most units can be found within four kilometres of a CBD and the majority of unit construction is occurring within these established urban areas. Knockdown and redevelopment or rear development is most common. Units in these developments have previously been mostly strata titled however these days there is a trend towards community title which has the appeal of allowing owners more ability to maintain the externalities of a unit without the need for as much formal approval. The market ranges from $150,000 to $350,000.

There are relatively few unit developments in new estate areas, although that’s not to say there aren’t any. In a planned gated community in Kelso called Wentworth Gardens, 2-bedroom, 2-bathroom units are being sold off the plan for between $350,000 and $375,000. Outside of such a gated community the extent of attached housing in new estates is limited to duplexes which have seen an increase in popularity lately.

Interestingly there have been a number of asymmetrical duplexes with typically a 4-bedroom dwelling on one side, and a smaller 2-bedroom granny flat sized dwelling on the other. This could be in response to the phenomenon of three or even four generations living under the same roof as housing and other living costs become more expensive. In terms of other attached units, there hasn’t been a development of a multi-storey apartment complex since the 1970s in the area. Unfortunately some of the existing complexes seem to have become synonymous with a lower socioeconomic status.

Of the attached housing in the area, a favourite remains the original terrace houses scattered throughout Bathurst. There are some in Orange but not as many. They may be two or perhaps six terraces in length, usually built before 1930 and often have decorative wrought iron.

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 – 2015. Australian Credit Licence Number 385325


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