source : www.smh.com.au
Domain Head of Research and Economics Dr. Nicola Powell said while more affordable areas showed increases, even declines in popular regions, such as Byron Bay, were starting to slow.
“It really paints that picture of how incredibly resilient house prices have been in regional NSW. The rebound we saw was the kind of gain we would have seen in Sydney,” Powell said. “The depth of that decline (in Byron) is starting to diminish. The peak percentage of declines is over. They are entering that phase of recovery.”
She said while each city had different factors, most declines would be the result of unaffordability and the impact of rising interest rates.
But relatively cheaper prices than neighboring towns and major cities and positive lifestyle aspects were still a powerful draw for buyers, Powell said.
KPMG regional economist Terry Rawnsley said more affordable cities continued to feel the ripple effect of the pandemic real estate boom as high-end buyers looked for cheaper homes.
“There is a ripple effect coming from the regional centres. People are being pushed into Gundagai from Yass,” Rawnsley said.
Areas that saw declines were more affected by interest rates as local buyers also reevaluated property prices post-pandemic.
“On the other hand, during some of those declines the market ran a little too fast. Byron is a classic example,” he said. “It still comes back to local foundations. The rising tide lifts all boats. We are now back to each market following its own course.”
He said regional areas are more vulnerable to distressed sellers because the market may not have enough diversity of buyers to stay afloat.
“Whereas in the city, if there is a distressed cohort, such as investors, owner-occupiers who have gobbled up shares, no problem.”
McGrath Byron Bay’s Will Phillips said the local market was performing stronger than earlier this year.
“The feeling is that we have definitely passed the valley. We feel like the market is the best we’ve seen in the last 18 months and we got that feeling around September,” Phillips said.
This was due to the limited supply of properties in light of growing demand from locals and Sydneysiders, he said.
Byron Bay seller Mark Ryan’s Belongil property is on the market and could be a family home or an investment.
“It is located in the Belongil district which is classified as 365 days a year, so unhindered for short term (accommodation), or you can live there. That has great appeal to investors and owner-occupiers,” says the 40-year-old lawyer. “I can rent that (as a short-term rental) every day of the year without any restrictions or we can rent long-term.”
He said there were still good buying opportunities in the city before the Byron Shire heads into another boom period.
Lauren Robertson of Gunnedah’s Robertson Real Estate said there was strong demand from local buyers and some investors from out of town.
She said the city’s strong mining and agricultural industries meant there were plenty of money-making buyers in the market.
“Supply is very low and has kept our house prices vibrant and rising. It is still very affordable for workers who are well paid in sectors such as mining and agriculture,” said Robertson.
source : www.smh.com.au