Changing buyer patterns
The COVID-19 pandemic helped to accelerate the phenomenon of homeowners being able to work remotely across Australia and they are spoiled with property lifestyle options to choose from – the beach and the bush. But which has performed better in terms of capital growth over the past year?
Pete Wargent, co-founder of national property buying company BuyersBuyers.com.au, said that “we have experienced a clear increase in enquiries from regional property buyers, and that has been reflected across all states and territories, and includes both sea and tree changes”.
“But when it comes to which has been the most popular choice of all, there’s no question that the coast and the water have been a major drawcard for Aussies over the past year. And the seachange locations have, on average, seen comparably higher rates of price growth to reflect that” Mr Wargent said.
“That having been said, there are plenty of inland markets that have been firing too, there’s no question about that”.
Riskwise Property Research ran the data to identify the suburbs where prices have spiked over the past year.
Doron Peleg of Riskwise Property Research noted that “as you might expect suburbs such as Byron Bay and Sunshine Beach have performed exceptionally strongly over the past year, recording dramatic price growth for detached houses”.
Mr Wargent of BuyersBuyers.com.au said that water views have always been a point great scarcity value in Australian property, and demand for these properties has been exceptionally strong over the past year.
Figure 1 – Top seachange suburbs over the past year (selected)
Source: CoreLogic, RP Data
Mr Wargent said that some inland markets have also benefited directly from regional moves away from the capital cities over the past year.
“Mittagong and Orange in New South Wales are two examples of markets where rentals have been very tight away from Sydney, and the surge in demand has pushed properties prices higher, while asking rents have exploded”.
“Locations offering an attractive lifestyle from those opting to work from home more often, such as Buderim on the Sunshine Coast, have also fared well” Mr Wargent said.
Figure 2 – Top treechange suburbs over the past year (selected)
Source: CoreLogic, RP Data
RiskWise CEO Doron Peleg said the onset of COVID-19 changed the way Australians worked as a nation with increasing numbers working from home, a trend that it likely to be sustained beyond 2021.
“Australians who have had more of a taste of working from home over the past year are now able to continue to work remotely and often we are seeing that it’s these buyers who are now seeking lifestyle properties and avoiding higher density locations”.
“The past 18 month has helped strengthen ‘work from home’ opportunities meaning owner-occupiers can take advantage of ‘lifestyle’ prospects instead of being so closely tied to employment hubs” Me Peleg said.
Mr Wargent of BuyersBuyers.com.au said that “even well before the pandemic, there was certainly a trend of homebuyers looking for the best of all worlds – lifestyle, accessibility to employment hubs and more affordable housing”.
“These include areas of southeast Queensland such as the Sunshine Coast and the Gold Coast, and on the northern New South Wales Coast. Then there’s also such as the Mornington Peninsula”.
Mr Wargent said beachside suburbs had especially outperformed the market as they offered such fantastic lifestyle opportunities.
“In fact, many investors consider both sea and treechange areas to be ‘investment destinations’ in which to achieve strong capital growth” Mr Wargent said.
“One thing to note, however, is that regional affordability has deteriorated in many cases since early 2020, and when the international borders reopen the popularity of capital city will ultimately reassert itself” Mr Wargent said.
RiskWise has also undertaken an analysis of popular treechange and seachange to determine which markets have performed better over longer time periods.
“The results showed that over the past five years seachange areas delivered more than double the price growth than treechange areas” Mr Peleg said.
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