Regional NSW September 2017

The month in review: Regional NSW

By Herron Todd White
September 2017

Southern Highlands

The Highlands property market is heavily influenced by what is happening in Sydney and historically lags that market six to 12 months. The most active market segment in the Highlands is in the sub $1.5 million price point for properties located close to infrastructure and the townships of Bowral, Moss Vale and Mittagong. The market continues to benefit from the ripple of the Sydney market, albeit over the past month agents are reporting that the heat seems to have subdued somewhat with respect to days on the market of listings.

New land releases across the townships and fringes of Bowral, Moss Vale and Mittagong provide first home owners and speculative investors entry point to the market from $350,000 (Nattai Ponds, Mittagong, 500 square metres) to $1 million (Retford Park, Bowral, 2 hectares). Likewise, established homes close to the townships of Bowral, Moss Vale and Mittagong provide families and retirees a wide choice, from $650,000 for an older style property in Mittagong to $2.5 million to $3 million for a contemporary residence on minimum land of 4,000 square metres.

The rural / lifestyle market appeals primarily to retirees and weekenders, with these properties typically from 20 to 40 hectares ranging in price from $1.5 million to $4 million, located on the outskirts of the townships of Bowral, Moss Vale and Mittagong and villages of Sutton Forest, Exeter and Robertson. It should be noted that this market is less defined with purchasers being more discriminating in their purchasing considerations.

Southern Tablelands

Owner-occupiers and investors from Canberra, Southern Highlands, Illawarra and Sydney have been prevalent over the past 12 months with this trend expected to continue. New land releases from $250,000 for the first home owner close to the township of Goulburn are available, albeit becoming more difficult to source. Established homes from $550,000 to $800,000 are the domain of families and investors. Similarly the rural / lifestyle market has seen an uptick in sales activity, together with the resurgence in rural property sales driven by increases in cattle and sheep prices, with strong sales activity from owner occupiers in the 20 hectare plus market.

NSW Mid North Coast

The market within the Port Macquarie area is still receiving strong activity from home owners. Recent sales show a trend of home owners purchasing new residential properties in the outer suburbs of Port Macquarie within new subdivisions. Here the land component is less expensive than the beachside suburbs with blocks ranging from $210,000 to $240,000.

Older standard and more centrally located 3-bedroom, 1-bathroom dwellings are proving to be popular with the first home buyer section, however steep competition earlier in the year has caused rapid increases in prices. This rapid increase has slowed and we are now seeing some of these houses taking longer to sell and often at below asking price. In the first half of 2017 these properties were mostly selling at listing price within one to two weeks.

We have noticed that the investor market has somewhat cooled with rental returns within the township of Port Macquarie decreasing slightly and allowing entry level owner-occupiers to be more active within the sector.

Houses within the middle range are still selling well with many of these properties being more suitable for middle to high level income families. A high percentage of these houses include pools, indicating that family friendly houses are being sought after within the region.

We have also noticed that there is limited stock of rural residential properties available for sale in the popular rural residential areas along the Mid North Coast.

Generally though, as investor activity has dropped off, owner-occupier activity has increased and overall market activity has lessened slightly during the second half of the year to date.

In our region we often see a slowing of the market during the winter period, but come springtime the markets tend to pick up again. We expect that over the next few months, the movement of the current market will indicate whether the area is going to experience a downturn over the next year.

NSW Central Coast

The local Central Coast real estate market continues to be quite active and strong. Feedback from real estate agents varies slightly with some complaining of limited stock to service their clients and others saying they worried that the market may be slowing. We tend to think that yes, there has been a slight slowing of sales but whether this is a seasonal thing or whether it will be an ongoing slowing of the market can only be quantified over the next few months.

At present, we and other observers have noted the inconsistent auction clearance rates lately. We have also noted that recently, quite a few more real estate agents are attending our valuation inspections for sale properties when only a few weeks ago, it was rare for them to attend as they were too busy.

Drivers in the market are well represented by Sydney residents relocating or investing here on the back of the comparative levels of affordability between the Sydney and local markets. Included in the mix though are the local residents who are entering the market for the first time, or sellers looking to upgrade or invest.

When we speak about first home buyers, typically we see them falling into three types of buyers: those who will only purchase a new dwelling; those targeting the unit market; and less common, those looking at old homes with a view to value add. What we are hearing a lot though is a strategy of buying and occupying for a short time before moving out and renting the property.

Real estate agents across the region are currently targeting the market up to $600,000, however we have yet to see any real results of the government’s first home buyer’s grant or stamp duty relief in the market. We expect to see the results becoming more noticeable over the next few months.

Second and subsequent buyers are more often simply looking to upgrade after selling their previous home and finding themselves with enough deposit to afford a much better property. Interestingly, although not overly represented are those selling their homes and moving onto rural lifestyle properties. The two main Central Coast valley areas of Matcham/Holgate and Yarramalong/Dooralong Valleys are getting most of the attention in this space. Expect to pay between $1.5 million to $2 million for a nice property in Matcham/Holgate and between $1 million and $1.5 million in Yarramalong/Dooralong.

With kids hanging around the house longer these days, empty nesters are becoming so much later in life – that is those who don’t find themselves looking after the grand children while the parents are both working. We read recently that once again the Central Coast region is a magnet for the grey hair types and that might explain why there has been a few more retirement villages and complexes built lately.

Attached housing is certainly front and centre in many of the region’s suburbs. This includes predominantly villas and townhouses seen across the various suburbs. The spread of ownership of villas and townhouses appears to favour owner-occupiers, but not by much as this type of property also attracts quite a few of the region’s investors due to the currently good yields being achieved.

We find that units are more centred around the main beach front areas or the Woy Woy, Gosford and Wyong railway stations, but we think that investors outnumber owner-occupiers overall here with solid returns available. This is dependant on the size and quality of units because we find that most of the higher standard (and value) units in the beachside locations are owner-occupied or weekenders with a few used for holiday lettings with very good returns available. If that sounds complicated, then we agree it can be.

At the moment, the Gosford CBD is going through a period of revitalisation with a number of unit complexes under construction, recently completed or due to start. Marketing is mostly being done at a local level and we must say, it is to a very professional standard. Off the plan sales and purchases are the norm and we understand that most of the complexes have been sold out. This is good for the region and at this stage, we cannot see an oversupply of units developing as in previous strong markets. We attribute this to the controlled or limited nature of developments occurring simultaneously either from the lenders (shackled by the authorities) or the developers themselves or some other providence.

NSW North Coast

Lismore / Casino / Kyogle

An interesting scenario has been developing in the past six months where first home buyers are experiencing some difficulty entering the property market.

This is not necessarily due to inability to secure finance or not knowing what house product to aim for, but is primarily due to the competition from other corners of the boxing ring…in this case, upgraders and investors.

Let’s face it…the price range for established houses and units in the Lismore, Casino and Kyogle areas is a mere speck compared to the large metropolitan cities of Brisbane, Sydney and Melbourne, yet lenders still seem to be relatively comfortable in granting loan approvals to first home buyers there for properties close to $1 million.

Within Lismore City suburbs, we are now seeing the odd house breaching $600,000 as demand for well presented homes is becoming increasingly buoyant. We note that lenders still seem willing to entertain the first home buyer for near new established homes or new build development which can hit in around the $350,000 to $500,000 price bracket…something relatively unheard of for a first home buyer even five years ago!

However, therein lies the problem. Not only are first home buyers having the opportunity to skip a long tradition of building up to the new build or near new home, other interested parties such as investors (as long as there is a good rental yield) and upgraders are competing for the available housing stock.

One may shudder at the $450,000 plus price bracket for a first home buyer which may suggest they prefer a millstone around the neck for a necklace. However, this is a decidedly better proposition than coughing up near to a $1 million in the larger cities or on the coast.

For some months, local real estate agents are lamenting the lack of stock and listings…and when they do get them, they are gone sometimes in a matter of days.

Picture a half-eaten, marinated chicken leg left overnight on the greasy kitchen bench and within a matter of minutes a horde of half-starved black ants are all over the discarded morsel – that is how I sense the first home buyer is feeling at the moment when missing out for the umpteenth time on securing their first purchase!

Another option to consider is the increasing volume of detached, free standing duplex units with a small yard. Slightly cheaper but still provides the 3- or 4-bedroom, 2-bathroom, double garage with less lawn to mow!

In summary, the first home buyer has not given up on their dream of buying their home, but it is definitely getting tougher….thanks to those pesky investors and upgraders.

Ballina /Byron

Home buyers are active in the market at present however a lack of stock coupled with continued strong demand is limiting the number of transactions across the Ballina Shire. A family home buyer typically looks for a conventional 3- to 4-bedroom freestanding dwelling, whilst it is typical to see empty nesters down sizing to more low maintenance properties. Demand for lowset housing in Ballina is typically much stronger than for properties of two levels or walk-up style units because of the older demographic active in this locality. We are not seeing a rise in people renting for lifestyle and investing rather than owning – that has always been popular across the Ballina/Byron region.

Home buyers are also very active in the Byron Shire LGA. They are evident in all suburbs from the high end of the spectrum in Byron Bay to the lower end coastal resort towns of Ocean Shores and Mullumbimby.

Typical home buyers appear to be middle aged families and are evident across all other market levels dependant only on their funds. There are also a significant number of baby boomers (home buyers between the ages of 55 and 75) in the prestige locality of Byron Bay.

The main price points for home buyers in the most popular suburbs in this location are as follows:

  • Byron Bay NSW 2481 – Has an estimated purchase price of between $1 million and $2 million
  • Lennox Head NSW 2478 – Has an estimated purchase price of between $700,000 and $1 million
  • Sub coastal resort towns such as Mullumbimby NSW 2482 and Ocean Shores NSW 2483 – Has an estimated purchase price of between $600,000 and $850,000

As the prices push up in the coastal resort towns in Lennox Head and Byron Bay, migrating families who are used to smaller allotments are happy to divert their attention away from grand houses to freestanding duplex units on smaller allotments. In terms of attached housing, the only difference identified between investors and home buyers when looking is that of land area. Homebuyers would pay a little bit more attention to the total strata area of any given unit.

The specific sector of the home buyer market on the move is that of Interstate or migration buyers. This type of buyer is generally workers who can keep their jobs in Sydney or Melbourne without a physical presence being necessary. As business grows across Australia, the Byron Shire becomes more appealing with easy access to nearby services such as the Ballina/ Byron airport and Gold Coast airport.

The home buyer sector of retirees does not appear to be active at all. In the Byron Shire LGA, retirees are already established home buyers who are not going to sell out only to buy back into this ever increasing market. The next generation of home buyers is also less common in this particular market due to the high purchase prices generally unachievable for this buyer type. First home buyers born and raised here are having to look outside these suburbs in order to get their foot in the door. Otherwise their only option is to buy and build in secondary location areas within Lennox Head, but only when the opportunity for land is available.

In one particular pocket in Byron Bay, there is a rise in the number of people investing in the holiday rental market. This is an ever increasing trend and is known locally as holiday hot spots. As the rent amount in this sector is similar to the affordability to own, there is little investment incentive, however there is much to gain as the yields from holiday rental properties continue to increase.

The Clarence Valley

Home buyers, first time, empty-nesters and otherwise, remain active in the Yamba/Maclean housing market. Whilst current market conditions are strong and investor interest continues, home ownership remains appealing to owner-occupiers due to the relative affordability of beach/country living available.

New homes are available in Maclean and Yamba for sub $450,000 and sub $600,000 respectively while older homes start at $300,000. Smaller lot living or unit living is also still appealing with units and townhouses available for between $250,000 and $300,000. On the other end of the spectrum, the rural residential market, particularly in Gulmarrad has a strong level of interest.

With so many options, there is no real trend towards attached or detached living as personal preference varies.

As opposed to investors, owner-occupiers are more concerned with capital returns in the medium to short term as well as being comfortable day to day. For instance, owner-occupiers in this market are more selective with features while investors remain driven by the highest rental returns and ease of ownership.

Due to the affordability of the market compared to nearby capital and major cities, first home buyers have not given up hope of home ownership, however we are seeing more land purchased and dwellings erected a number of years later, indicating a slower financial process. Also, the mention of guarantor or the like appears to be becoming more common.

Coffs Harbour

Although we have seen considerable activity from investors over recent years, owner-occupiers still make a sizable sector of the market. When you consider that there are first home buyers, trade up or down buyers and retirees all looking to secure properties, there is no one size fits all in relation to property. It is difficult to pigeon hole what each buyer profile looks like or the attributes sought after in a property. The first home buyer conjures up images of the young twenty something purchaser when in fact we are seeing the thirty or forty something age bracket also trying to get off the rental treadmill. The younger generation seems to be attracted to the shiny new product whist the older group looks towards an older home. As property prices continue to strengthen, new product is becoming less affordable and it is becoming increasingly difficult to find a house under $500,000. Therefore the trend is to go to unit product (townhouse or villa) or further afield to the smaller townships in the more affordable price range of under $500,000.

The trade up or down buyers are diverse in their requirements and will generally be attracted to areas which suit their lifestyle depending on age and family needs. On this basis it is difficult to stereotype the style of product or price range they are seeking.

Downsizers typically look toward the unit and small lot properties. We have seen an increase in unit development within Coffs Harbour generally centred on the Jetty precinct and Park Beach areas. These two areas are only two kilometres apart however miles apart in value. The more affluent downsizer looks toward the Jetty precinct close to the harbor and CBD with local restaurant and tourist facilities. The average price for modern units is $500,000 to $800,000. Park Beach although having similar attributes of a good beach and shopping facilities has a more modest unit price range of $370,000 to $600,000 for modern units.

Highway upgrades north and south of Coffs Harbour have reduced travel times making commuting easier which has attracted many potential home purchasers to more fringe beachside localities such as Corindi Beach to the north, being popular with commuters from both Coffs Harbour and Grafton, and Nambucca Heads to the south where property prices are considerably more affordable in the $300,000 to $400,000 price range.

Home occupiers have many options with no one sector or locality being seen as more active in the market place, rather it is dependent upon the affordability factor of the purchaser and lifestyle benefits they seek as to where they choose to purchase and what they may buy.

Generally speaking the Coffs Coast is known for its lifestyle benefits. Demand has traditionally been driven by population growth due to its destination for retirees and more significantly for families moving from the southern regions looking for a more affordable and relaxed lifestyle. The appeal of the area is a reflection of the climate, attractive nature of the locality including many beaches and diversity of housing product close to the coast with good regional facilities.

The next generation can still afford to purchase within the Coffs Coast as there is an ample range of property priced under $350,000 so long as they are prepared to look at the older units in central Coffs Harbour or homes further afield in the lesser known townships such as Nambucca Heads, Macksville and Grafton. We note a main factor for the next generation and current generations for that matter is the availability of work. Although work is readily available it is the type and quality of work which can be limited and we are seeing more potential home occupiers investing in these areas with a view to relocating in the future.


Home buyers are significantly active in Albury-Wodonga and as a strong regional area, all the traditional life stages are still clearly evident in the behaviour towards home ownership which is achievable on both sides of the border. We run the gamut in regard to home owners with housing stock available in many different market segments. First home owners appear to be enticed by their first home being a new home and often this is achievable if they have been living at home or renting affordably whilst saving a deposit. However, recent increases in vacant land prices may have given rise to first home owners reconsidering existing dwellings as their starting point.

We have seen the detached dwelling sub $200,000 market diminish significantly, in most part due to investors rather than home owners. First home owners appear reluctant to buy the basic starter house despite a good supply of dwellings available sub $300,000. Upgraders seem to be on the move with better prices being achieved for basic housing stock and they are paying more as a result for the next home or trying to keep the first home as well. The 2016 census results indicate an even spread of age groups across Albury-Wodonga, with a spike in the 2 to 29 age group for Wodonga and as many people never married as married. So still plenty of life stages to come and with entry levels into the housing market still achievable, people generally have a plan to upgrade.

First home owners have options in Albury-Wodonga and a budget of between $280,000 to $350,000 will secure a detached dwelling in a new housing estate or sub $300,000 budget gives options in the existing dwelling market. The upgraders’ budget is around $350,000 to $450,000 depending on the property they are jumping up from and can be spread evenly between new and existing stock. The forever home owner has the largest budget range of between $500,000 to $800,000 which may be a build or fully renovated dwelling. The downsizer’s budget may also be dependant on where they have divested and is usually between $400,000 and $600,000 – low maintenance, central, all done or ready to tackle major renovation in prime locations with cash to spare. The last two categories are experiencing competition from many cashed up ex Sydney or Melbourne relocators and the lower end of market is facing competition from out of town investors.

There is little commentary required regarding attached or medium to high density housing trends in Albury- Wodonga. Approximately 85% of dwellings are detached, with the remainder more likely to be semi-detached and very few units. The new housing stock is predominantly 3- to 4-bedroom, 2-bathroom detached dwelling on varying allotment sizes. There have been some new developments completed with small allotments and some semi-detached streets within this subdivision and there is a mix of homeowners and renters occupying these dwellings. There was also a recent spike in duplex construction usually with configuration of 3-bedrooms and 1- or 2-bedrooms, although the majority were marketed and sold to the investor market. Overall, probably due to the expectation of living in the country, a detached dwelling is preferable, in plentiful supply and still top of mind for most home buyers. There is however very often a premium paid for quality 1- and 2-bedroom dwellings, be they detached or not. This smaller market segment looks for location, privacy, neighbourhood and dwelling condition.

The sector of the homeowner market on the move is not particularly defined, however housing stock on the move seems to be established homes between $300,000 and $400,000 in Wodonga and more mixed in Albury, where home owners are seemingly able to find fully renovated character dwellings in prime central locations. Possibly all sectors are having a rethink on the value of established dwellings versus the rising cost of building with higher vacant land and construction costs. And looking at the increase in young people in Wodonga and older people in Albury, the pattern of demand for stock to meet these different needs will impact the next generation who have not given up on the idea of home ownership. Actually in our region they seem more savvy and informed than ever, and increasingly aware that they are competing with out of town investors on lower priced properties and stable, long term employment more the focus than affordability at present.

The range of affordable housing stock and the lifestyle on offer are draw cards for regional areas generally and specifically for Albury-Wodonga there are many dynamic growth and infrastructure investment projects nearing completion. Home ownership will remain desirable, especially against the backdrop of entry into the property market in the major metropolitan areas now out of reach for so many and no relief in sight for the housing affordability crisis in Melbourne and Sydney.


While housing affordability seems to be trending towards becoming more of a challenge in Central West NSW, it is definitely not at the crisis proportions of Sydney, and unlikely to be for the foreseeable future. Despite land values increasing noticeably over the past two years, home ownership (with or without a mortgage) is not out of reach for average income earners and is the situation for the majority of households in the area. The level of purchaser activity over the past 12 months has been remarkable amongst local home owners, investors from all locations and tree changers alike. With interest rates at all time lows and affordability and investor returns worsening in Sydney, it seems like a case of no end in sight. Local agents are reporting record online views and some properties have been selling for slightly over asking price, giving us all pause to reconsider our benchmarks.

The change has been very noticeable for rural properties. The rural lifestyle has become increasingly convenient for purchasers from all areas as services and transport improve, adding value to such properties. If anything there is the potential in the region for an oversupply in the residential market between $350,000 and $450,000 as construction continues apace. These are typically dwellings in more recent developments on the fringes of towns, which is nothing if not encouraging for future first home buyers.


Tamworth has a strong owner-occupier sector throughout all levels of the market. From first home owners who are typically 20 to 30 years old and in the market from $250,000 to $400,000, to upgraders who are 30 plus and in the market from $400,000 plus, the owner-occupier market remains accessible and strong within the Tamworth region.

First home owners are buying in the Hillvue, South Tamworth and Oxley Vale areas when looking at houses between the $250,000 to $350,000 mark. Over this price, the suburbs of Calala and North Tamworth come into play, especially when it comes to building a first home. Though we have not noticed a significant decrease yet, the elimination of stamp duty for first home owners may steer people away from constructing their first home. Some of the biggest draw cards to building a home was that there was no stamp duty and the availability of the first home owner’s grant, meaning that when looking at a $370,000 to $400,000 house, first home owners required less deposit if constructing.

Upgraders tend to look more towards parts of Hillvue, East Tamworth and the rural residential suburbs surrounding Tamworth such as Moore Creek and Daruka. They are looking more at the perfect family home, rather than just getting their foot in the door.

The majority of these buyers are focused on the detached dwelling market as the unit market in Tamworth is comparatively small and aimed more at investors or older people looking to downsize. There is also a strong mentality of living the great Australian dream where buyers want that backyard for the dog and given the affordability of Tamworth they can do this.

The removal of stamp duty has seen an increase in interest from first home buyers, however as yet this hasn’t translated into a notable jump in sales. At present all sectors of the market continue to tick along steadily with no one sector leading the charge. Due to the affordability of Tamworth where a nice 3-bedroom home can be purchased for $250,000 we certainly haven’t seen a shift in people giving up on the home ownership dream or a trend in rentvestors and expect the dream to stay a viable option for the future.

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