The month in review: Newcastle
By Herron Todd White
This month we venture into two locations within close proximity of Newcastle to explore the traditional property types and highlight some of the changes underway within these locations.
Located in the Port Stephens region, Nelson Bay has long been regarded as a favourite holiday destination for many (some referring to it as the Florida of New South Wales) while still within close proximity of Newcastle and the Newcastle airport. Nelson Bay’s housing market has undergone significant changes in recent times. Nelson Bay has actually faced a population decline of 4% between 2006 (5,668) and 2011 (5,393). Since 2013 the housing market has bounced with an average capital gain of 5.56%, however interestingly Nelson Bay’s ten year average capital growth is a much lower 0.59%, largely driven by the aftermath of the GFC. Anecdotal evidence is showing the market has stabilised somewhat in 2016, however Nelson Bay is still experiencing considerable activity in home renovation and investment, particularly in units.
With a population largely driven by couples (65%) who are outright homeowners there will continue to be demand for detached family homes, many of these built post 1970s. Nelson Bay and its surrounds cater for a range of property types from unit style living to large detached family houses, while locations such as Soldiers Point and Corlette cater for higher value waterfront living with houses regularly selling over $2 million.
According to RP Data, in June 2016 Nelson Bay had a median house price of $495,000 and median unit price of $410,000, which highlights a small gap in value compared to other locations. The outlook for the Nelson Bay market will be largely dependant on the nearby Sydney and Newcastle property markets where many investors and holiday home owners reside.
Further down the New South Wales coastline lies Swansea, a town located on an isthmus kissing Lake Macquarie and a short 27 kilometre drive from Newcastle. Swansea is a popular coastal town, especially with boat lovers, and with a population of 4,833 in 2011 the township has seen stable population growth in recent times. The predominant age group in Swansea is 65 to 74 years old, while childless couples reside in 32% of households (RP Data).
The housing styles in Swansea and surrounding suburbs including Blacksmiths and Pelican largely consist of older coastal dwellings built between the 1940s and 1970s, with 43% of total households owned outright. However there are consistent signs of renovations within the locality due to its close proximity to Newcastle and its coastal appeal. Swansea’s average median house price in 2016 is $542,875 and its ten year capital growth is 3.25%. Given the older demographics of this area, the outlook for Swansea and its surrounds is highly
leveraged to the investor and retiree markets and the growth prospects appear relatively stable and reliant on population growth.