Red hot Sydney market sends buyers to the bush
Media release - 10 November, 2016
Regional New South Wales is proving increasingly attractive to buyers and investors priced out of Sydney’s booming property market, according to leading real estate group, Raine & Horne.
“Continued growth in Sydney’s median house price – which rose almost 3% in the last three months to $800,000 – is driving demand for property in growth centres, three to four hours by car from the metropolitan area,” said Angus Raine, Executive Chairman, Raine & Horne.
“Centres such as Bathurst, Young and Muswellbrook are relatively close to Sydney, yet their property prices are significantly below the city median.”
In NSW’s South West Slopes region, city investors seeking affordable property values and strong yields have made their presence felt in Young, according to Graeme Schneider, Principal of Raine & Horne Young. “Compared to the previous Spring, investor numbers are significantly up,” he said.
Affordability and healthy yields are central to Young’s appeal. The median price for a 3-bedroom house is $245,000, with a median weekly rental of $250. For two bedroom units, the median price is $175,000 with a weekly median rent of $230. This represents a gross yield of 6.8% for apartments.
Apart from strong yields, investors recognise that Young has a healthy and diverse economy, according to Mr Schneider.
“Young’s major industries include agriculture, horticulture, construction, engineering and steel fabrication, retail and service industries,” he said. “Young offers stable employment opportunities, along with a very comfortable standard of living, which is attractive for tenants moving to the town. This is a trend savvy Sydney investors are recognising.”
Michelle Mackay, Co-Principal of Raine & Horne Bathurst, said it’s a case of “when Sydney real estate boils, Bathurst simmers up too”.
“We’re seeing many buyers and investors priced out of Sydney at local open for inspections this Spring,” said Ms Mackay.
Raine & Horne Bathurst recently took to market a development of 28 residential blocks at Wentworth Drive, Kelso. The blocks achieved an average sale price of $180,000.
“We only have 4 left with developers, and Sydney buyers are leading the charge for these rare blocks,” said Ms Mackay.
In NSW’s Hunter region, the improvement in the coal price is helping drive confidence in Muswellbrook property, according to Grant Jupe, Principal of Raine & Horne Muswellbrook.
“Our region has been supported by mining for employment. So, when the bottom fell out of the coal price it caused job losses and hit the property market hard,” he said.
But with the coal price returning to form and the decision by miner Mach Energy to start work on developing the coal deposit at Mount Pleasant, confidence in Muswellbrook real estate is returning to normal, according to Mr Jupe. “The Mach Energy mine is expected to create hundreds of jobs when it’s fully operational.”
To illustrate his point, Mr Jupe said that in July 2014, there were 250 vacant residential rentals in Muswellbrook. “Today this number is down to 80 properties. There are virtually no houses and mainly only units available for rent,” he said.
In addition, development plans have been filed with Muswellbrook Shire Council for a new abattoir and feed lot facility. The new abattoir is expected to support 500 local jobs, according to Mr Jupe.
“The new mine and abattoir developments bode well for long-term real estate values and yields,” said Mr Jupe.
“In turn, stronger market conditions are attracting Sydney buyers. This additional activity has helped to push up the median house price by 1.4% to $280,000 in 2016.”
For further media information contact:
Angus Raine, Executive Chairman, Raine & Horne on 0409 920 697
Andrew Harrington, National Communications Manager, Raine & Horne, on 02 9258 5400