The month in review: Sydney
By Herron Todd White
Traditionally, the suburbs of Sydney were all about the great Australian dream: a quarter acre block (well not quite in most instances) with a modest family home and reasonable size back yard was very much the typical experience for most Sydneysiders in the 1950s to 1970s. Fast forward to 2016 and the buyer wish list is as varied as the housing options now available. Overall there has been a definite change in the type of properties that your average homeowner has trended to in recent times. Smaller homes on larger blocks seem to be a thing of the past, with modern day families focusing more on larger, good quality, modern homes on smaller, low maintenance parcels. To provide some detail within the various sub markets of the metropolitan area we have looked at options within the outer west, inner Sydney and at the prestige level.
In the outer west we can use the suburb of South Penrith as an example. It sits within three kilometres of the regional centre of Penrith and has easy access to two exits of the M4 motorway. The suburb was developed predominantly in the 1970s and your typically home was of brick and tile construction, on a 600 to 750 square metre land parcel, with 3-bedrooms, 1-bathroom and a single garage. The suburb attracted a lot of families moving west from the city to start their lives. The next generation of buyer in South Penrith was often the first home buying children of the original era. One more generation on and while South Penrith is still popular with some first home buyers, many have been swayed by the new kid in town, the house and land package in new estates such as Jordan Springs or Claremont Meadows which are within five kilometres of Penrith and close to the original family home.
In some cases, for the same $650,000 outlay for a home in South Penrith, you can get a brand new 3- to 4- bedroom dwelling in a planned community estate. What’s the catch I hear you ask? While you may get a shiny new dwelling, typically they are on quite small allotments, have a side wall built on the adjoining boundary and at that price tend to have very similar inclusions to all the neighbours. On the flip side, in South Penrith, you may often be dealing with a tired home in need of renovation, but you do have considerable land size on an old style subdivision featuring that thing of the past known as the wide street.
It comes down to personal preference, but there has been a definite shift towards low maintenance house and land packages on small blocks in planned estates. Where to in the future? Like most markets, there is always room for a vast array of differing property types. What will drive their growth into the future will be ongoing infrastructure projects in and around Penrith and improved transport options.
With limited stock on the market throughout most of this year there has been a standout performer across the inner Sydney suburbs. New property has been the winner. Whether it is newly renovated property with high quality finishes or newly built properties such as modern style terraces, townhouses and duplexes, the buyer appeal has been strong and wellpriced property has achieved good results for those just wishing to unpack their bags and move straight in.
Inner west and eastern suburbs period homes and terraces on small blocks have always proved to be appealing to a majority of the market with original period features such as high ornate ceilings, timber flooring, stained glass windows and ornate fireplaces and a small courtyard garden.
Traditionally the inner west market demanded period homes and new builds were considered out of place. However, recently the latter have increased in both popularity and supply due to up-sizers wanting to stay in the inner west market, but satisfy their craving for more flexible living areas and modern features. For example 100 Allen Street, Leichhardt, featuring 4-bedrooms, 2-bathrooms, double garage and in-ground pool, sold for $2,700,000 by Bresicwhiteney Estate Agents. This was well above expectations and generated a high level of interest throughout its campaign.
The eastern suburbs have also seen a spike in interest in newly renovated properties and newly built properties. With the rising costs of renovating older style Victorian terraces and semis, the shift to move in and enjoy with nothing to do properties has generated high levels of interest and record prices. From Little Bay to Dover Heights, the East is seeing an increasing number of duplex style properties being constructed with the market already accustomed to smaller parcels of land than other parts of Sydney. An example of the popularity of this type of product in the market is the recent sale of 4a Owen Street, North Bondi. This is a modern 3-bedroom, 3-bathroom strata titled duplex with single garage, modern high quality features, study, cinema room, rear deck and established landscaping on around 220 square metres of land. The property sold at auction for $2,751,500 through Ray White Double Bay after a four week campaign.
In the south, larger blocks with big homes popular from the 1970s through to the early 2000s are slowly being phased out with the market demanding a modern, high tech, yet low maintenance lifestyle and the original land owner being able to capitalise on the lack of available land and subdivide the parent parcel to form two allotments.
New duplexes have proved extremely popular in the southern suburbs even on parcels as small as 275 square metres. Larger back yards requiring constant maintenance are becoming less sought after. A recent example of an architectural dwelling on a small parcel is 53B Oleander Parade, Caringbah South. The original parcel was subdivided into two smaller lots (approximately 450 square metres each) and attracted high levels of interest with high quality features, low maintenance grounds and plunge pool, setting a new benchmark of $2.105 million at auction. Not all new products feature in this price bracket but most modern townhouses and attached duplexes are now achieving $1 million plus.
With significant capital growth over the past five to ten years, what was originally the family home has often been held on to as an investment property when the owners upgrade. In areas such as the eastern suburbs, it is common for these properties to be in $2 million to $3 million price bracket.
Prestige residential property in Sydney is generally considered to be properties valued at greater than $3 million. Prestige homes are scattered throughout the greater Sydney metropolitan area, with the highest concentrations in the eastern suburbs and eastern beaches, inner city and inner east, inner west and the lower and upper north shores.
Prestige property types cover a wide range of dwellings and apartments, with no single property type truly representative of the whole of the prestige market.
Traditionally, freestanding dwellings on larger allotments have been the sought after ideal, however over the past decade, the lines have blurred considerably as property values continue to rise throughout Sydney.
In the sub $5 million bracket, prestige property can include terraces homes, freestanding homes on small, medium and larger allotments, converted warehouses, townhouses and both period and contemporary apartments.
An example includes 7 Lower Fort Street, The Rocks, which recently sold for $4.7 million. It comprises a 6-bedroom, 3-bathroom circa 1880 terrace home on a 207 square metre site with harbour and Opera House views. The property has no on-site parking and requires extensive renovation.
In the $5 million to $10 million bracket, prestige property tends to encompass primarily freestanding homes on medium to larger allotments, some renovated period and contemporary prestige apartments and very few converted warehouse properties and terrace homes.
An example includes Unit 3, 28 Billyard Avenue, Elizabeth Bay which recently sold for $7 million. The property is a high quality circa 1998 apartment in a harbour front complex with quality harbour and district views, providing single level 3-bedroom, 2-bathroom, 2-car garage accommodation. In the $10 million and over bracket, prestige property is generally limited to freestanding homes on larger allotments and a limited number of penthouse apartments.
An example includes 36 Chamberlain Avenue, Rose Bay which recently sold for $12.5 million. The property is a 1,257 square metre dual frontage site with expansive harbour, district, CBD, Harbour Bridge and Opera House views, improved with a substantial renovated and extended period home providing 5-bedroom, 5-bathroom, 2-car garage accommodation and grounds including an in-ground pool and tennis court.
Prestige terrace homes tend to be centred in the higher density inner city and city fringe locations. These may include period renovator’s delights throughout areas such as The Rocks, renovated period terraces throughout areas such as Paddington, Elizabeth Bay, Potts Point and Kirribilli, with a smattering of contemporary terrace homes throughout areas such as Paddington.
Numerous suburbs throughout the Sydney area provide freestanding homes, both of period and contemporary style. Properties throughout the Upper North Shore (including areas such as Killara) tend to encompass renovated period or Federation era style homes. The eastern suburbs and Lower North Shore are also characterised by renovated period homes, though contemporary freestanding homes remain equally sought after though less abundant.
Southern suburbs generally encompass renovated semi-modern homes though to contemporary properties both on water front and non water front sites in this price range, with the Hills District also characterised by larger contemporary homes on typical parcels of 1000 square metres and a mix of semi-modern renovated and contemporary homes on acreage sites where substantial improvements can include tennis courts, pools, outdoor living rooms and stables.
Converted warehouses have also grown in popularity over recent times. Demand for this style of property tends to be cyclical and they tend to be centred in city fringe and inner west localities.
Prestige apartments tend to be centred in the CBD and CBD fringe areas, eastern suburbs and eastern beaches and Lower North Shore, with a smattering throughout the Cronulla area.
Over recent times, there has been a noticeable emergence of demand for more centrally located and higher quality property. Given the inherent reduction in allotment sizes in closer proximity to the CBD, greater demand is being shown for premium apartments and terrace homes. The empty nester market is a strong driver of demand for this style of property, though it is becoming increasingly desirable for families to relocate into this style of accommodation, as proximity to amenities such as restaurants, shopping, parks and harbour foreshores
become increasingly sought after and desirable.
Sydney has continued to exceed market predictions over the past six months and while there was some
caution in the market leading up to and immediately following the July federal election, we consider that the upcoming spring season will be solid. Property that was available for sale throughout the typical sluggish winter months achieved good prices and this could be attributed in part to the limited stock available. Auction results, which are seen as an indicator of market sentiment, have been tracking well over the past six weeks in both clearance rates and volume put to market.
Segments of the Sydney property market, especially those that will benefit from proposed infrastructure projects, are expected to continue to perform well. Segments where the local council permit subdivision and construction of duplexes which in turn feed the desire for a modern, low maintenance dwelling are also considered to perform well especially if they are coupled with good access to transport links.
The modern duplex has many characteristics of the original terrace dwelling so the traditional family home is returning.
Canberra was developed as the nation’s capital in the early 1900s.
Initially almost all construction work in the capital was undertaken by Commonwealth instrumentalities. Government built housing was required to accommodate the public servants who transferred
from interstate. Early construction comprised a mix of brick and tile cottage style housing. Traditional housing styles changed in line with market, cost and construction trends over time, however, the traditional Canberra red brick cottage is still referred to today.
These traditional homes are generally centrally located in some of Canberra’s early suburbs including Griffith, Kingston and Yarralumla and currently form part of the top end of the residential market due to block size and location. Many have been extended over time.
In recent times, modern construction within developing estates has seen a trend towards contemporary designs using modern lightweight cladding material. These materials and construction techniques are cost efficient for builders and allow high rates of production of dwellings which has been required due to housing demand.