New South Wales. Month in Review September 2017

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4 New South Wales Overview The word home is full of meaning on a variety of levels and our nation is particularly affiliation with the idea of home ownership and amplifies its significance even further. Homeowners make up the majority of our market, but homes are different things to different people around Australia. Given how influential homebuyers are to our residential markets, we ve asked our offices around the nation to provide a rundown of the homeowner market in each of their service areas. Sydney Home buyers or owner occupiers are currently the most active buyers across Sydney after a number of recent policies were implemented aimed at reducing the number of new investor loans from lenders. The New South Wales State Government recently implemented a package for first home buyers which abolishes stamp duty on home purchases up to $650,000 with reduced stamp duty due on home purchases up to $800,000. A $10,000 grant for purchase of new homes up to $600,000 is also in place for first home buyers. With the median Sydney house price well in excess of these thresholds, many home buyers are considering different types of homes to the traditional detached home with a large backyard. Whilst investors look towards both capital growth and rental returns in their property purchasing decisions, home owners are increasingly being drawn towards low maintenance living within close proximity of schools, public transport and other services. Western Sydney In western Sydney, home buyers have been particularly active in the past few years with strong growth recorded across the wider market. The popularity of certain property types highlights the changing face of western Sydney housing. This is more prevalent in the new estates with smaller block sizes being released, more semi-detached housing and highrise residential developments being built in areas not traditionally known for high density living. Jordan Springs is a new suburb in the Penrith LGA with a recent release providing two storey, 3-bedroom, 2-bathroom semi-detached dwellings with a single garage on 170 square metres of land for around $680,000. Traditionally, areas further away from Sydney s CBD offered larger landholdings; today these pocket sized blocks are becoming more common in western Sydney as housing densities increase and developers, along with local councils, address affordability concerns by offering a product that appeals to entry level buyers. We have also seen high density units and high rise developments being constructed in areas that have not seen this style of development for a number of years, if at all. This is mostly due to surging values now making developments like these more feasible. Penrith has a number of unit complexes but no large scale development has occurred for a number of years, whilst Blacktown provides a number of low to medium rise unit complexes but only in recent times has genuine high rise development occurred. An example of this is the Lord Sheffield Circuit development in Penrith, located in the new Thornton precinct, which is providing new 1-bedroom units for circa $450,000. In Blacktown an under construction 20 storey development at Second Avenue is offering 1-bedroom units from around $470,000. South-Western Sydney South-western Sydney is appealing to a range of home buyers, particularly more price sensitive buyers such as first and second home buyers. In addition to providing an entry point to the Sydney property market, there are also options for buyers upsizing to more substantial property or down sizing from larger acreage style property in the region. Land values have increased substantially over recent years, which is reflective of the broader Sydney property market and also due to the proximity of the future Badgerys Creek Airport precinct and expanding western Sydney area. 24

5 Home buyers are mainly attracted to newer localities and estates in areas linked with good access to services and amenities, public transport and major roadways. Newer housing estates are predominantly found along growth corridors, particularly along Camden Valley Way which travels from Edmondson Park through to Camden, a stretch of approximately 20 kilometres. Other popular new estates among home buyers include Elizabeth Hills and Middleton Grange which are situated adjacent to the M7 motorway and will also benefit from good access to the future Badgerys Creek Airport precinct. Many of these suburbs are part of a master plan which include shopping centres, parks and community facilities, all of which are imperative for attracting the home buyer. These new precincts are attractive to the broader home buyer market given the range of housing options and price points that appeal predominantly to first and second home buyers, but also offer options to established property owners looking to spend over $1 million. An example of a typical entry point is 36 Rosella Circuit, Gregory Hills, which sold for $702,000 in March The property was a modern 4-bedroom, 2-bathroom, single level residence with 2-car garage on a 380 square metre lot. Source: Realestate.com.au An alternative option many home buyers are increasingly moving towards is secondary purpose built self-contained accommodation, whether that be for children, older aged parents, or to rent to provide additional income. Some project builders are also incorporating attached selfcontained accommodation options into some of their designs, reflecting just how popular this type of accommodation is becoming. 4B Flume Street, Leppington, which sold for $1,100,000 in April 2017, comprised a large two storey residence with a detached 2-bedroom granny flat to the rear. Source: Realestate.com.au 25

6 Southern Sydney Like other parts of Sydney, investor demand has declined in recent months while home owners are generally remaining active in the market. First home buyers generally budget up to $1,000,000, which in this part of Sydney generally restricts property options to units, villas and townhouses. There are a number of new unit developments in the Sutherland Shire which are attractive for first home buyers including those at Woolooware Bay and the South Village development currently under construction at Kirrawee. For the latter, 1-bedroom units are selling off the plan for between $600,000 and $700,000, and 2-bedroom units for between $680,000 and $900,000. Upsizers and families require a budget of $1 million up to $3 million in more popular beachside and riverside suburbs. Duplex properties are becoming increasingly attractive, allowing a more affordable option of a good sized modern home on a smaller low maintenance block of land. A sale at 32B Carabella Road, Caringbah, which sold for $1.562 million in August 2017, comprised a new two storey semidetached duplex with 4-bedrooms, 2-bathrooms and 1-car garage on a 280 square metre lot. Source: Domain Empty nesters and downsizers are increasingly looking at large modern apartments in premium locations, which provide a low maintenance lifestyle close to cafes, restaurants and shopping facilities. In many cases, these buyers are looking to spend as much as, or more than, the sale proceeds from their large family home. Cronulla has become a popular location for empty nesters and retirees with a number of modern boutique complexes being constructed in recent years. A large modern garden apartment, opposite the beach, sold in June 2017 for $2.76 million The apartment, at 4/29-31 Prince Street, comprised 3-bedrooms, 2-bathrooms, double basement car space and a large wraparound yard area providing beach and ocean views. Source: Realestate.com.au Inner Sydney With tighter restrictions recently imposed on the investor market, it is expected that first and second home buyers will continue to become more prominent over the coming months. Upsizers seem to be dominating the market in this area at present, especially in the higher value brackets. Downsizers are also active, realising the value of their home in the current market and purchasing in low density, high quality unit developments. First time buyers have generally been priced out of the dwelling market in recent years with units becoming a more popular option for this market segment. With entry level Torrens titled dwellings in the inner west now typically in the $1.2 million to $1.4 million range, many first time buyers have found these properties to be increasingly out of reach. A 26

7 property at 200 Addison Road, Marrickville recently sold in August for $1,355,000, comprising a detached single level Federation dwelling with 2-bedrooms, 1-bathroom and positioned on a 259 square metre block of land. source: realestate.com.au The Bosco development in the inner west suburb of Five Dock is a medium-scale, high quality development of 152 units which have been purchased by a mix of investors, first time buyers and also downsizers with no buyer appearing to have a dominant share. The mix of 1-, 2- and 3-bedroom units meant that there were options available for the different buyer profiles. The 3-bedroom units for example proved popular with the downsizers who still wanted a sense of space, but had decided on a more low-maintenance style of living. Several resales of 2-bedroom units through a local agent in this complex have ranged between $925,000 and $1.05 million. The selling agent has noted significant local interest for these units from owner-occupiers. Whilst the property market in general appears to have cooled slightly during the winter period, the $2 million to $5 million bracket appears to be performing strongly. Demand at this price range remains high for both dwellings and units with buyers ready to utilise strong capital growth obtained from existing property portfolios. A recent sale of a 3-bedroom unit in the popular Darling Island Road complex in Pyrmont was hotly contested with the agent advising a high level of interest and strong demand, resulting in a sale price of $4.39 million. With such strong market growth over recent years, younger generations are starting to accept the fact that they may not be able to afford to buy a home in Sydney close to the CBD or coast. They must either succumb to renting in the area or re-locate to be able to find properties selling within their budget. Relocating may involve moving to suburbs with better affordability within Sydney or relocating to another city or interstate to obtain home ownership and a more affordable lifestyle. A more recent strategy, known as rentvesting, appears to be becoming a more popular choice, where buyers look to regional and interstate property markets to purchase an investment property whilst continuing to rent in an area where they want to live but can t afford to buy. Conclusion The home buyer is the most active buyer in the market at present. With increased incentives for first home buyers and tighter restrictions around investor lending, owner occupier demand is expected to remain strong over the coming months. The great Australian dream of home ownership still appears to be that of many, however the type of home that represents continues to evolve. From new housing estates comprising smaller blocks of land to duplex and granny flat construction in existing areas to boutique and larger scale unit developments, there are many options now available to the home buyer to meet their changing needs and budgets. With housing affordability in Sydney becoming an increasing issue, the next generation will have to continue to look to new alternatives such as rentvesting as their first step into property ownership. Canberra Lately there has been a lot of activity in the Canberra market with several different demographics keen to make the most of the current market conditions. First home buyers, downsizers and families looking to upgrade have all been active in the property market as well as those who are new to Canberra. 27

8 First home buyers have affordable detached housing options in the outer suburbs of Belconnen and Tuggeranong, while Gungahlin provides newer detached housing at more of a premium. Alternatively, there are affordable unit options available throughout the Canberra region with new developments being completed in the city and town centres. There is also a large supply of older units close to the city and in the suburbs that would be suitably priced for first home buyers. The strong detached housing market has forced most first home buyers to look to apartments to climb onto the property ladder. Recently, there has been strong demand from downsizers looking to move out of the family home into something smaller. The demand has been so strong that some developers are targeting this market specifically for their new projects. This move has been prompted by several things, and downsizers are taking advantage of the strong housing market, selling homes often in established suburbs for record high prices, and a proposal announced in this year s budget, allows downsizers to allocate some of the profit made selling the family home into their Superannuation. New Canberra residents have been active mainly in the Gungahlin market where they can buy new homes in a newly established suburb. Demand has been very strong from these buyers with land selling at a similar rate per square meter to land in established inner suburbs. This demographic has also been active in the new apartment market especially dwellings in close proximity to universities and town centres. Illawarra Home ownership continues to be an aspiration in the Illawarra. The 2016 census reports that 67.7% of occupied private dwellings are owner-occupied with the remainder either rented (28.6%) or unclassified (3.6%). This is a slightly higher proportion than that of NSW (64.5%) and Australia (65.5%). Local agents are reporting owner-occupiers are very active in the market. We find there can be three categories of owneroccupier: first home owners, families; and empty nesters. Each of these types of buyer will have their own personal criteria for their home with style, location and budget being the main factors. Broadly speaking first home buyers will be purchasing a strata title property or an older style single dwelling at the lower end of the market. Families look to upgrade to a 3- or 4-bedroom suburban home and this can include an established dwelling or construction in a new land estate. Empty nesters will often downgrade in size however may increase in price point. It is first home buyers who face the most competition for property from investors as they are typically looking for similar property attributes such as convenient locations and affordability. Both first home buyers and investors are particularly active in the unit market in the Illawarra. As it stands, all areas of the Illawarra residential property market have experienced significant growth recently. At this stage the Illawarra is still affordable to many owner-occupiers, especially when compared to Sydney. In fact part of the driving force behind the strong market is Sydney buyers who are priced out of their local market looking further south. Southern Highlands The Highlands property market is heavily influenced by what is happening in Sydney and historically lags that market six to 12 months. The most active market segment in the Highlands is in the sub $1.5 million price point for properties located close to infrastructure and the townships of Bowral, Moss Vale and Mittagong. The market continues to benefit from the ripple of the Sydney market, albeit over the past month agents are reporting that the heat seems to have subdued somewhat with respect to days on the market of listings. New land releases across the townships and fringes of Bowral, Moss Vale and Mittagong provide first home owners and speculative investors entry 28

9 point to the market from $350,000 (Nattai Ponds, Mittagong, 500 square metres) to $1 million (Retford Park, Bowral, 2 hectares). Likewise, established homes close to the townships of Bowral, Moss Vale and Mittagong provide families and retirees a wide choice, from $650,000 for an older style property in Mittagong to $2.5 million to $3 million for a contemporary residence on minimum land of 4,000 square metres. The rural / lifestyle market appeals primarily to retirees and weekenders, with these properties typically from 20 to 40 hectares ranging in price from $1.5 million to $4 million, located on the outskirts of the townships of Bowral, Moss Vale and Mittagong and villages of Sutton Forest, Exeter and Robertson. It should be noted that this market is less defined with purchasers being more discriminating in their purchasing considerations. Southern Tablelands Owner-occupiers and investors from Canberra, Southern Highlands, Illawarra and Sydney have been prevalent over the past 12 months with this trend expected to continue. New land releases from $250,000 for the first home owner close to the township of Goulburn are available, albeit becoming more difficult to source. Established homes from $550,000 to $800,000 are the domain of families and investors. Similarly the rural / lifestyle market has seen an uptick in sales activity, together with the resurgence in rural property sales driven by increases in cattle and sheep prices, with strong sales activity from owner occupiers in the 20 hectare plus market. Newcastle Newcastle has traditionally been a working class city with reasonable housing prices, but as the Sydney market has become increasingly difficult to near on impossible for new investors and new homebuyers, Newcastle has felt the effects and demand is pushing prices. Newcastle homebuyers are now moving further out into developing suburbs like Thornton and Fletcher. Some home buyers however are investing in smaller older homes in the traditionally cheaper suburbs and choosing the renovation option. Carrington is one of these suburbs. Not many suburbs epitomized Newcastle s working class image more than Carrington, with much of the suburb zoned industrial and Newcastle s major wharf located on the North side, Carrington has always been a blue collar suburb, however that is changing and homebuyers are moving in. With its close proximity to the city, beaches, schools, numerous parks and most of all affordability, Carrington has become trendy to families and first home buyers not wanting to live in attached dwellings or move to the outer suburbs. Older inner city suburbs like Carrington are seeing rejuvenation as home buyers are turning old into new again. On the flip side to this, those not wanting to renovate are still finding homes in the outer suburb estates or inner city duplex s and townhouses that seem to be popping up everywhere. Even though housing prices are certainly increasing the dream is still very much alive and achievable in Newcastle for those wanting their own home. Whether it s old or new, it s up to you. NSW Mid North Coast The market within the Port Macquarie area is still receiving strong activity from home owners. Recent sales show a trend of home owners purchasing new residential properties in the outer suburbs of Port Macquarie within new subdivisions. Here the land component is less expensive than the beachside suburbs with blocks ranging from $210,000 to $240,000. Older standard and more centrally located 3-bedroom, 1-bathroom dwellings are proving to be popular with the first home buyer section, however steep competition earlier in the year has caused rapid increases in prices. This rapid increase has slowed and we are now seeing some of these houses taking longer to sell and often at below asking price. In the first half of 2017 these properties were mostly 29

10 selling at listing price within one to two weeks. We have noticed that the investor market has somewhat cooled with rental returns within the township of Port Macquarie decreasing slightly and allowing entry level owner-occupiers to be more active within the sector. Houses within the middle range are still selling well with many of these properties being more suitable for middle to high level income families. A high percentage of these houses include pools, indicating that family friendly houses are being sought after within the region. We have also noticed that there is limited stock of rural residential properties available for sale in the popular rural residential areas along the Mid North Coast. Generally though, as investor activity has dropped off, owner-occupier activity has increased and overall market activity has lessened slightly during the second half of the year to date. In our region we often see a slowing of the market during the winter period, but come springtime the markets tend to pick up again. We expect that over the next few months, the movement of the current market will indicate whether the area is going to experience a downturn over the next year. NSW Central Coast The local Central Coast real estate market continues to be quite active and strong. Feedback from real estate agents varies slightly with some complaining of limited stock to service their clients and others saying they worried that the market may be slowing. We tend to think that yes, there has been a slight slowing of sales but whether this is a seasonal thing or whether it will be an ongoing slowing of the market can only be quantified over the next few months. At present, we and other observers have noted the inconsistent auction clearance rates lately. We have also noted that recently, quite a few more real estate agents are attending our valuation inspections for sale properties when only a few weeks ago, it was rare for them to attend as they were too busy. Drivers in the market are well represented by Sydney residents relocating or investing here on the back of the comparative levels of affordability between the Sydney and local markets. Included in the mix though are the local residents who are entering the market for the first time, or sellers looking to upgrade or invest. When we speak about first home buyers, typically we see them falling into three types of buyers: those who will only purchase a new dwelling; those targeting the unit market; and less common, those looking at old homes with a view to value add. What we are hearing a lot though is a strategy of buying and occupying for a short time before moving out and renting the property. Real estate agents across the region are currently targeting the market up to $600,000, however we have yet to see any real results of the government s first home buyer s grant or stamp duty relief in the market. We expect to see the results becoming more noticeable over the next few months. Second and subsequent buyers are more often simply looking to upgrade after selling their previous home and finding themselves with enough deposit to afford a much better property. Interestingly, although not overly represented are those selling their homes and moving onto rural lifestyle properties. The two main Central Coast valley areas of Matcham/Holgate and Yarramalong/Dooralong Valleys are getting most of the attention in this space. Expect to pay between $1.5 million to $2 million for a nice property in Matcham/Holgate and between $1 million and $1.5 million in Yarramalong/Dooralong. With kids hanging around the house longer these days, empty nesters are becoming so much later in life - that is those who don t find themselves looking after the grand children while the parents are both working. We read recently that once again the Central Coast region is a magnet for the grey hair 30

11 types and that might explain why there has been a few more retirement villages and complexes built lately. Attached housing is certainly front and centre in many of the region s suburbs. This includes predominantly villas and townhouses seen across the various suburbs. The spread of ownership of villas and townhouses appears to favour owner-occupiers, but not by much as this type of property also attracts quite a few of the region s investors due to the currently good yields being achieved. We find that units are more centred around the main beach front areas or the Woy Woy, Gosford and Wyong railway stations, but we think that investors outnumber owner-occupiers overall here with solid returns available. This is dependant on the size and quality of units because we find that most of the higher standard (and value) units in the beachside locations are owner-occupied or weekenders with a few used for holiday lettings with very good returns available. If that sounds complicated, then we agree it can be. At the moment, the Gosford CBD is going through a period of revitalisation with a number of unit complexes under construction, recently completed or due to start. Marketing is mostly being done at a local level and we must say, it is to a very professional standard. Off the plan sales and purchases are the norm and we understand that most of the complexes have been sold out. This is good for the region and at this stage, we cannot see an oversupply of units developing as in previous strong markets. We attribute this to the controlled or limited nature of developments occurring simultaneously either from the lenders (shackled by the authorities) or the developers themselves or some other providence. NSW North Coast Lismore / Casino / Kyogle An interesting scenario has been developing in the past six months where first home buyers are experiencing some difficulty entering the property market. This is not necessarily due to inability to secure finance or not knowing what house product to aim for, but is primarily due to the competition from other corners of the boxing ring in this case, upgraders and investors. Let s face it the price range for established houses and units in the Lismore, Casino and Kyogle areas is a mere speck compared to the large metropolitan cities of Brisbane, Sydney and Melbourne, yet lenders still seem to be relatively comfortable in granting loan approvals to first home buyers there for properties close to $1 million. Within Lismore City suburbs, we are now seeing the odd house breaching $600,000 as demand for well presented homes is becoming increasingly buoyant. We note that lenders still seem willing to entertain the first home buyer for near new established homes or new build development which can hit in around the $350,000 to $500,000 price bracket something relatively unheard of for a first home buyer even five years ago! However, therein lies the problem. Not only are first home buyers having the opportunity to skip a long tradition of building up to the new build or near new home, other interested parties such as investors (as long as there is a good rental yield) and upgraders are competing for the available housing stock. One may shudder at the $450,000 plus price bracket for a first home buyer which may suggest they prefer a millstone around the neck for a necklace. However, this is a decidedly better proposition than coughing up near to a $1 million in the larger cities or on the coast. For some months, local real estate agents are lamenting the lack of stock and listings and when they do get them, they are gone sometimes in a matter of days. Picture a half-eaten, marinated chicken leg left overnight on the greasy kitchen bench and within a matter of minutes a horde of half-starved black ants are all over the discarded morsel that is how I sense the first home buyer is feeling at the moment when 31

12 missing out for the umpteenth time on securing their first purchase! Another option to consider is the increasing volume of detached, free standing duplex units with a small yard. Slightly cheaper but still provides the 3- or 4-bedroom, 2-bathroom, double garage with less lawn to mow! In summary, the first home buyer has not given up on their dream of buying their home, but it is definitely getting tougher.thanks to those pesky investors and upgraders. Ballina /Byron Home buyers are active in the market at present however a lack of stock coupled with continued strong demand is limiting the number of transactions across the Ballina Shire. A family home buyer typically looks for a conventional 3- to 4-bedroom freestanding dwelling, whilst it is typical to see empty nesters down sizing to more low maintenance properties. Demand for lowset housing in Ballina is typically much stronger than for properties of two levels or walk-up style units because of the older demographic active in this locality. We are not seeing a rise in people renting for lifestyle and investing rather than owning - that has always been popular across the Ballina/Byron region. Home buyers are also very active in the Byron Shire LGA. They are evident in all suburbs from the high end of the spectrum in Byron Bay to the lower end coastal resort towns of Ocean Shores and Mullumbimby. Typical home buyers appear to be middle aged families and are evident across all other market levels dependant only on their funds. There are also a significant number of baby boomers (home buyers between the ages of 55 and 75) in the prestige locality of Byron Bay. The main price points for home buyers in the most popular suburbs in this location are as follows: Byron Bay NSW Has an estimated purchase price of between $1 million and $2 million Lennox Head NSW Has an estimated purchase price of between $700,000 and $1 million Sub coastal resort towns such as Mullumbimby NSW 2482 and Ocean Shores NSW Has an estimated purchase price of between $600,000 and $850,000 As the prices push up in the coastal resort towns in Lennox Head and Byron Bay, migrating families who are used to smaller allotments are happy to divert their attention away from grand houses to freestanding duplex units on smaller allotments. In terms of attached housing, the only difference identified between investors and home buyers when looking is that of land area. Homebuyers would pay a little bit more attention to the total strata area of any given unit. The specific sector of the home buyer market on the move is that of Interstate or migration buyers. This type of buyer is generally workers who can keep their jobs in Sydney or Melbourne without a physical presence being necessary. As business grows across Australia, the Byron Shire becomes more appealing with easy access to nearby services such as the Ballina/ Byron airport and Gold Coast airport. The home buyer sector of retirees does not appear to be active at all. In the Byron Shire LGA, retirees are already established home buyers who are not going to sell out only to buy back into this ever increasing market. The next generation of home buyers is also less common in this particular market due to the high purchase prices generally unachievable for this buyer type. First home buyers born and raised here are having to look outside these suburbs in order to get their foot in the door. Otherwise their only option is to buy and build in secondary location areas within Lennox Head, but only when the opportunity for land is available. In one particular pocket in Byron Bay, there is a rise in the number of people investing in the holiday rental market. This is an ever increasing trend and is known locally as holiday hot spots. As the rent amount in this sector is similar to the affordability 32

13 to own, there is little investment incentive, however there is much to gain as the yields from holiday rental properties continue to increase. The Clarence Valley Home buyers, first time, empty-nesters and otherwise, remain active in the Yamba/Maclean housing market. Whilst current market conditions are strong and investor interest continues, home ownership remains appealing to owner-occupiers due to the relative affordability of beach/country living available. New homes are available in Maclean and Yamba for sub $450,000 and sub $600,000 respectively while older homes start at $300,000. Smaller lot living or unit living is also still appealing with units and townhouses available for between $250,000 and $300,000. On the other end of the spectrum, the rural residential market, particularly in Gulmarrad has a strong level of interest. With so many options, there is no real trend towards attached or detached living as personal preference varies. As opposed to investors, owner-occupiers are more concerned with capital returns in the medium to short term as well as being comfortable day to day. For instance, owner-occupiers in this market are more selective with features while investors remain driven by the highest rental returns and ease of ownership. Due to the affordability of the market compared to nearby capital and major cities, first home buyers have not given up hope of home ownership, however we are seeing more land purchased and dwellings erected a number of years later, indicating a slower financial process. Also, the mention of guarantor or the like appears to be becoming more common. Coffs Harbour Although we have seen considerable activity from investors over recent years, owner-occupiers still make a sizable sector of the market. When you consider that there are first home buyers, trade up or down buyers and retirees all looking to secure properties, there is no one size fits all in relation to property. It is difficult to pigeon hole what each buyer profile looks like or the attributes sought after in a property. The first home buyer conjures up images of the young twenty something purchaser when in fact we are seeing the thirty or forty something age bracket also trying to get off the rental treadmill. The younger generation seems to be attracted to the shiny new product whist the older group looks towards an older home. As property prices continue to strengthen, new product is becoming less affordable and it is becoming increasingly difficult to find a house under $500,000. Therefore the trend is to go to unit product (townhouse or villa) or further afield to the smaller townships in the more affordable price range of under $500,000. The trade up or down buyers are diverse in their requirements and will generally be attracted to areas which suit their lifestyle depending on age and family needs. On this basis it is difficult to stereotype the style of product or price range they are seeking. Downsizers typically look toward the unit and small lot properties. We have seen an increase in unit development within Coffs Harbour generally centred on the Jetty precinct and Park Beach areas. These two areas are only two kilometres apart however miles apart in value. The more affluent downsizer looks toward the Jetty precinct close to the harbor and CBD with local restaurant and tourist facilities. The average price for modern units is $500,000 to $800,000. Park Beach although having similar attributes of a good beach and shopping facilities has a more modest unit price range of $370,000 to $600,000 for modern units. Highway upgrades north and south of Coffs Harbour have reduced travel times making commuting easier which has attracted many potential home purchasers to more fringe beachside localities such as Corindi Beach to the north, being popular with commuters from both Coffs Harbour and Grafton, and Nambucca Heads to the south where property prices are 33

14 considerably more affordable in the $300,000 to $400,000 price range. Home occupiers have many options with no one sector or locality being seen as more active in the market place, rather it is dependent upon the affordability factor of the purchaser and lifestyle benefits they seek as to where they choose to purchase and what they may buy. Generally speaking the Coffs Coast is known for its lifestyle benefits. Demand has traditionally been driven by population growth due to its destination for retirees and more significantly for families moving from the southern regions looking for a more affordable and relaxed lifestyle. The appeal of the area is a reflection of the climate, attractive nature of the locality including many beaches and diversity of housing product close to the coast with good regional facilities. The next generation can still afford to purchase within the Coffs Coast as there is an ample range of property priced under $350,000 so long as they are prepared to look at the older units in central Coffs Harbour or homes further afield in the lesser known townships such as Nambucca Heads, Macksville and Grafton. We note a main factor for the next generation and current generations for that matter is the availability of work. Although work is readily available it is the type and quality of work which can be limited and we are seeing more potential home occupiers investing in these areas with a view to relocating in the future. Albury Home buyers are significantly active in Albury- Wodonga and as a strong regional area, all the traditional life stages are still clearly evident in the behaviour towards home ownership which is achievable on both sides of the border. We run the gamut in regard to home owners with housing stock available in many different market segments. First home owners appear to be enticed by their first home being a new home and often this is achievable if they have been living at home or renting affordably whilst saving a deposit. However, recent increases in vacant land prices may have given rise to first home owners reconsidering existing dwellings as their starting point. We have seen the detached dwelling sub $200,000 market diminish significantly, in most part due to investors rather than home owners. First home owners appear reluctant to buy the basic starter house despite a good supply of dwellings available sub $300,000. Upgraders seem to be on the move with better prices being achieved for basic housing stock and they are paying more as a result for the next home or trying to keep the first home as well. The 2016 census results indicate an even spread of age groups across Albury-Wodonga, with a spike in the 2 to 29 age group for Wodonga and as many people never married as married. So still plenty of life stages to come and with entry levels into the housing market still achievable, people generally have a plan to upgrade. First home owners have options in Albury-Wodonga and a budget of between $280,000 to $350,000 will secure a detached dwelling in a new housing estate or sub $300,000 budget gives options in the existing dwelling market. The upgraders budget is around $350,000 to $450,000 depending on the property they are jumping up from and can be spread evenly between new and existing stock. The forever home owner has the largest budget range of between $500,000 to $800,000 which may be a build or fully renovated dwelling. The downsizer s budget may also be dependant on where they have divested and is usually between $400,000 and $600,000 - low maintenance, central, all done or ready to tackle major renovation in prime locations with cash to spare. The last two categories are experiencing competition from many cashed up ex Sydney or Melbourne relocators and the lower end of market is facing competition from out of town investors. There is little commentary required regarding attached or medium to high density housing trends in Albury- Wodonga. Approximately 85% of dwellings are detached, with the remainder more likely to be semi-detached and very few units. The new housing 34

15 stock is predominantly 3- to 4-bedroom, 2-bathroom detached dwelling on varying allotment sizes. There have been some new developments completed with small allotments and some semi-detached streets within this subdivision and there is a mix of homeowners and renters occupying these dwellings. There was also a recent spike in duplex construction usually with configuration of 3-bedrooms and 1- or 2-bedrooms, although the majority were marketed and sold to the investor market. Overall, probably due to the expectation of living in the country, a detached dwelling is preferable, in plentiful supply and still top of mind for most home buyers. There is however very often a premium paid for quality 1- and 2-bedroom dwellings, be they detached or not. This smaller market segment looks for location, privacy, neighbourhood and dwelling condition. The sector of the homeowner market on the move is not particularly defined, however housing stock on the move seems to be established homes between $300,000 and $400,000 in Wodonga and more mixed in Albury, where home owners are seemingly able to find fully renovated character dwellings in prime central locations. Possibly all sectors are having a rethink on the value of established dwellings versus the rising cost of building with higher vacant land and construction costs. And looking at the increase in young people in Wodonga and older people in Albury, the pattern of demand for stock to meet these different needs will impact the next generation who have not given up on the idea of home ownership. Actually in our region they seem more savvy and informed than ever, and increasingly aware that they are competing with out of town investors on lower priced properties and stable, long term employment more the focus than affordability at present. The range of affordable housing stock and the lifestyle on offer are draw cards for regional areas generally and specifically for Albury-Wodonga there are many dynamic growth and infrastructure investment projects nearing completion. Home ownership will remain desirable, especially against the backdrop of entry into the property market in the major metropolitan areas now out of reach for so many and no relief in sight for the housing affordability crisis in Melbourne and Sydney Orange While housing affordability seems to be trending towards becoming more of a challenge in Central West NSW, it is definitely not at the crisis proportions of Sydney, and unlikely to be for the foreseeable future. Despite land values increasing noticeably over the past two years, home ownership (with or without a mortgage) is not out of reach for average income earners and is the situation for the majority of households in the area. The level of purchaser activity over the past 12 months has been remarkable amongst local home owners, investors from all locations and tree changers alike. With interest rates at all time lows and affordability and investor returns worsening in Sydney, it seems like a case of no end in sight. Local agents are reporting record online views and some properties have been selling for slightly over asking price, giving us all pause to reconsider our benchmarks. The change has been very noticeable for rural properties. The rural lifestyle has become increasingly convenient for purchasers from all areas as services and transport improve, adding value to such properties. If anything there is the potential in the region for an oversupply in the residential market between $350,000 and $450,000 as construction continues apace. These are typically dwellings in more recent developments on the fringes of towns, which is nothing if not encouraging for future first home buyers. Tamworth Tamworth has a strong owner-occupier sector throughout all levels of the market. From first home owners who are typically 20 to 30 years old and in the market from $250,000 to $400,000, to 35

16 upgraders who are 30 plus and in the market from $400,000 plus, the owner-occupier market remains accessible and strong within the Tamworth region. First home owners are buying in the Hillvue, South Tamworth and Oxley Vale areas when looking at houses between the $250,000 to $350,000 mark. Over this price, the suburbs of Calala and North Tamworth come into play, especially when it comes to building a first home. Though we have not noticed a significant decrease yet, the elimination of stamp duty for first home owners may steer people away from constructing their first home. Some of the biggest draw cards to building a home was that there was no stamp duty and the availability of the first home owner s grant, meaning that when looking at a $370,000 to $400,000 house, first home owners required less deposit if constructing. Australian dream where buyers want that backyard for the dog and given the affordability of Tamworth they can do this. The removal of stamp duty has seen an increase in interest from first home buyers, however as yet this hasn t translated into a notable jump in sales. At present all sectors of the market continue to tick along steadily with no one sector leading the charge. Due to the affordability of Tamworth where a nice 3-bedroom home can be purchased for $250,000 we certainly haven t seen a shift in people giving up on the home ownership dream or a trend in rentvestors and expect the dream to stay a viable option for the future. Upgraders tend to look more towards parts of Hillvue, East Tamworth and the rural residential suburbs surrounding Tamworth such as Moore Creek and Daruka. They are looking more at the perfect family home, rather than just getting their foot in the door. The majority of these buyers are focused on the detached dwelling market as the unit market in Tamworth is comparatively small and aimed more at investors or older people looking to downsize. There is also a strong mentality of living the great 36

17 Victoria Melbourne Inner City Home ownership rates in Melbourne and the surrounding inner suburbs continue to fall simultaneously with house prices continuing to grow, forcing couples and prospective home buyers to settle for renting rather than ownership. The family home is continually changing and being redefined in Melbourne, with only 10% of households overall being made up of couples with children and only 20-25% within the suburbs of Richmond, Prahran, South Melbourne as home buyers looking to start a family are being pushed further out to accommodate their budgets. We are seeing the Millennials choosing to rent for the lifestyle of being close to Melbourne s Central Business District (CBD) and other amenities, rather than investing in home ownership. The rental rate within Melbourne is 63% and the inner suburbs average 50% to 55% of households being renters. First home owners within the hub of Melbourne are young couples (32%) and single households (24%) who aren t in need of large areas of land, but prefer to be nearby work and also enjoy the benefits of the night life of Melbourne. The home buyer frenzy has flattened, with the lowest sales per month in recent years being recorded in April this year (1,511) as activity continues to subdue. House prices within Melbourne continue to stay strong with recorded growth of 10.1% in the median house price since the beginning of South Eastern Suburbs Interest for housing opportunities in the southeastern suburbs continues to strengthen. Clyde North, Botanic Ridge, Cranbourne East and Officer have been experiencing a housing boom since 2016 as the south-east region grows year on year. The typical buyer in the area is a young family consisting of two adults and children (ABS, 2016). Typically they are first home buyers who take advantage of the stump duty saving opportunity by purchasing a property under $600,000. They are large inside space seekers (i.e. the number of bedrooms, living areas, etc. is their established and important preference). The second and third group of buyers are downsizers from established large homes and investors who enter the market because of the relatively low property price range (below median) and prospective capital growth coupled with moderate rental returns. The Australian dream notably transforms over time as the south-east Melbourne corridor continues to densify. A quarter acre block becomes a developer s opportunity rather than an average solo homeowner prospect. Eastern Suburbs Home ownership has been touted as the great Australian dream for decades, but the definition of a home is changing. Within the middle eastern suburbs such as Glen Waverley, Vermont and Wantirna, purchase of a family dwelling is considered out of scope for first home buyers, with the entry level valued at above $1 million. There appears to be an equal distribution throughout these suburbs between investors and established owner-occupier families. Families who have settled into these suburbs are not tending to move to other municipalities, but more so they are either re-developing a new family home on their land, or relocating nearby. Further to this, the recent activity between APRA and the major financial institutions has seen a slight decrease in investor activity. This is creating an almost even market between investors and established owner-occupiers. Within Ringwood there is a strong investor market in comparison to adjoining suburbs of Ringwood North, Ringwood East and Park Orchards where there is a strong owner-occupier market. These suburbs identify with a large growth in apartments whereby they are either purchased by first home owners or investors to then lease. Similarly, Croydon and Croydon North are comprised of mainly first home 37

18 owners and families, with a smaller emphasis on investor activity in apartment purchases. The outer eastern suburbs are seeing a lot of investment activity within Ferntree Gully, Kilsyth and certainly Boronia, making it difficult for first home owners to compete in these suburbs. The supply for investors appears to be fuelled by the older generation down sizing and moving closer to the city. Similarly, further east into Belgrave, Upwey and the Mount Dandenong Ranges, the same supply is being created with baby boomers moving towards the city however, these properties are being purchased by a younger generation. These properties are more affordable, at approximately $600,000 to $650,000, appealing to young families who prefer a larger property over a closer location to the CBD. In addition to this, younger families are also purchasing in and around Chirnside Park and Lilydale due to the increase of newer properties available. Northern Suburbs Melbourne s northern suburbs continue to offer various options for prospective home owners from empty nesters looking to move from larger eastern properties and downsize and settle in the inner northern suburbs to families who are able to upgrade to accommodate growing families. Larger 3- and 4-bedroom detached dwellings continue to be in high demand in Melbourne s outer north. While median sale prices for detached houses in the metro Melbourne area are currently at $822,000 according to REIV, outer northern suburbs such as Craigieburn and Mickleham are more affordable with median house prices of $495,000 and $515,000 respectively. Whilst detached housing remains a preferred property type for potential home owners, the steady property market increase in Victoria limits the ability of some first home buyers to afford detached housing. This makes more affordable villa units and townhouses in the outer northern suburbs further from the city centre popular choices, with median unit prices of $365,000 and $333,000 in Craigieburn and Sunbury respectively (REIV). Downsizers who decide to move to Melbourne s inner northern suburbs are usually represented by babyboomers and empty nesters who choose to swap their large (and thus hard to maintain) houses in the suburbs for smaller units and boutique developments catering to owner-occupiers who wish to be closer to the Melbourne city centre in order to enjoy a more active life style. Typically, downsizers choose Melbourne s inner and middle ring suburbs, such as Hawthorn to move into. Property prices are not the main driver within this market, as downsizers are looking for better infrastructure and quality of the developments. Western Suburbs Family buyers are active in the inner suburbs of Seddon and Yarraville, approximately six and eight kilometres west of Melbourne s CBD respectively. Families are lured by the intact streetscapes, period housing, public transport, schools, access to the city, cafes and shopping that these suburbs offer. As of June 2017 the median price for Seddon was $917,000 and the median for Yarraville was $1,101,000 (REIV, 2017) which typically would put these suburbs out of reach of first home buyers. However, relative to other eastern suburbs a similar distance from the Melbourne CBD, the lower price points of Seddon and Yarraville mean they are attractive for family buyers. Further out, the suburb of Deer Park has seen its median house price rise by 17% to $590,000 in the June 2017 quarter (REIV, 2017). Deer Park provides good transport and infrastructure and offers first home buyers larger land sizes and family properties with a median price that is just under the $600,000 stamp duty threshold. Surrounding suburbs such as Cairnlea and Ardeer are also popular with first home and family buyers. St Albans median unit price increased by 22% to 22.2% in the June 2017 quarter (REIV June 2017). The house and land market in outer western suburbs such as Wyndham Vale, Tarneit and Truganina and north-western suburbs such as Melton, Thornhill Park, Brookfield and Harkness is remaining buoyant 38

19 as first home buyers and families continue to seek out affordable housing. The changes introduced on 1 July 2017 to the First Home Owners Grant and stamp duty are expected to keep this demand constant as the majority of purchasers in this area aim to spend under $600,000 on their house and land to avoid paying stamp duty. The predominant property type purchased in these suburbs is new house and land packages as there is new stock coming onto the market frequently and the savings offered to first home buyers coupled with the ability to personalise the dwelling being great incentives. There are a small quantity of townhouse developments within Point Cook, Tarneit and Truganina however the majority of purchasers favour detached dwellings, particularly young families as many want a backyard or a larger style house to accommodate their family. Investors form a smaller portion of the purchaser profile in the outer suburbs as there is less demand in these areas in comparison with inner suburbs such as Footscray, Moonee Ponds and Essendon. Ballarat As housing affordability in Melbourne continues to be a major issue, people are looking to regional areas as a way to get their foot in the property market. The Melbourne buyer has entered the Ballarat market targeting centrally located properties and more specifically properties within close proximity to the railway station. Soldiers Hill situated north of the railway station has experienced steady growth over the past year with the median house price in April 2017 at $365,000 up from $318,000 the same time last year. Central Ballarat and Alfredton also experienced a 6.5% increase in the first quarter of the year. Market confidence in Ballarat continues to rise with the State Government moving 600 jobs to the Ballarat Civic Hall site in 2020, upgrades to the railway line to decrease commuter time to Melbourne and redevelopment of the Ballarat Station precinct. July 1st saw the commencement of the new First Home Owner s Grant, with stamp duty concession on existing dwellings under $600,000 and an increased incentive to newly built homes. In the lead up to July 1st, first home buyers withdrew from the market waiting to cash in on the government incentives. As the financial year clicked over, central areas of Ballarat experienced the greatest growth in prices. The volume of vacant land sales spiked in new residential estates as of July 1st. Ballarat has no shortage of vacant land for sale with new residential estates offering land in Bonshaw, Lucas, Delacombe and Alfredton. Prices have eased for land due to the oversupply over the past few years. Stats are yet to be released for the month of July but the general consensus amongst property professionals is there is greater demand and first home buyers are making up a considerable portion of buyers in the market in central areas. Outer areas of Ballarat including Sebastopol, Wendouree and Miners Rest remain steady, recording limited growth. Bendigo The Bendigo residential market has seen consistent growth over the past 12 months with increasing government support for first home buyers in regional areas. This increase in funding has seen a lift in new home construction rates in the Bendigo area particularly in the new estates around Epsom, Marong and Huntly. With property prices rising in the capital cities, regional centres such as Bendigo offer first home buyers an opportunity to live in a new home within 20 minutes of a CBD for less than half a million dollars. For homes under $350,000 in value, rental rates are only marginally cheaper than paying a mortgage. With the Calder Highway and V-line trains connecting Bendigo to Melbourne within two hours of travel, Bendigo is far from isolated. Echuca Home ownership has taken a variety of forms in recent times with a key focus being on new developments on account of very little existing 39

20 housing stock being available in the marketplace. Consequently the combination of land price, building cost and final value have come into sharper focus for most home owners, with most focused on West Echuca on the Victorian side and West Moama on the New South Wales side. Horsham The reintroduction of the first home owner s grant by the federal government has seen an increased confidence in the residential property market in Horsham in recent months, with an increased volume of sales, Many young couples and families are entering the property market for the first time, either buying an existing home or buying land within a new residential estate to build a home. Coming off an above average harvest for the 2016 season and early signs of a relatively good harvest for the 2017, the Horsham region has also seen many farmland transaction occurring and consequently seeing farmers retiring into the city centre, looking for modern established homes to enjoy their retirement in. With the housing market within the Horsham region still ranging between $200,000 and $400,000 the Australian dream of owning your own home is still very much obtainable and evident given that the rental market only makes up approximately 29% of the region s occupancy. Mildura Home ownership in Mildura is still a realistic goal, with the median house price being around $260,000 and for units $180,000. Families and older couples make up the largest percentage of people living in Mildura and the majority of buyers in Mildura are owner-occupiers. Statistics prepared by Corelogic tell us that the average time a home in Mildura is held is around eight years, which supports our observation that many buyers gradually trade their way up from entry level homes to better standard homes as their financial circumstances improve. Over the past ten years, first home buyers have shown a willingness to take on more debt in order to acquire more expensive first homes. No doubt the low interest rate environment has contributed to this confidence, however it appears that many first home buyers have much higher expectations than previous generations. Most first home buyers in Mildura are looking for modern detached dwellings in better locations and will typically spend from $280,000 to $350,000. The presence of attractive first home owner grants has made building a home an attractive option for many young people. Currently there is $20,000 available to first home buyers who build a home in Victoria and $10,000 in NSW, which when combined with the stamp duty exemptions currently available make this attractive for many people. We note however, that the cost of land and building has increased in recent years by at least this amount, making this option less attractive than it once would have been. Townhouses and units are mostly being purchased by either investors or retirees, attracted by the lower maintenance requirements. There has been a trend in the past five to ten years for many empty nesters to move from their large family homes to new townhouses on compact lots. The development of around 70 residential lots within part of the Mildura golf course has met with strong demand from this buyer segment who are typically spending between $450,000 and $650,000 to acquire good standard housing on lots of around 500 square metres. Buyers in Mildura still have a preference for detached dwellings and the relative affordability of land makes this possible. Our constant theme is that owner-occupiers (and tenants) always show a preference for homes which have functional outdoor living areas designed to be shaded in the summer months. Mildura has long, hot summers, and the ability to spent time outdoors is an important consideration for home buyers. Warrnambool Warrnambool s residential market is somewhat removed from the affordability issues which dominate the metropolitan markets. As such, home 40

21 buyer activity continues to occur across most demographic groups within Warrnambool. First home buyers within Warrnambool are currently operating in the $300,000 to $400,000 price range. However a recent trend for first home buyers has been going down the path of a house and land package. This is on the back of recent government incentives that offer stamp duty exemptions and construction allowances for properties built within regional areas. Financially secure families are looking at purchasing well established properties located within Central Warrnambool or selective north Warrnambool pockets, with retirees or couples looking to downsize generally looking at the Central Warrnambool market. Being surrounded by a larger rural and rural lifestyle demographic we are seeing a current trend with older couples in these areas choosing to cash out, downsize and bank or invest any surplus funds. These buyers focus on low maintenance, centrally located properties and operate at a higher price point than most family buyers. Both demographics are confident with purchasing within the Warrnambool market as owner-occupiers. Demand from home buyers remains focused on traditional detached housing. This tendency to remain traditional rather than seek out attached housing options is solely due to very limited stock of this type in area. The great Australian dream of home ownership is alive and well in Warrnambool. This is due to the continuing release of new residential land supply on the city s extremities, a steady median price as well as the existing low-cost, affordable pockets in area such as Dennington and North Warrnambool. 41

22 Queensland Brisbane One thing remains true about Brisbane - we have all the makings of a great home-ownership location. There s an abundance of affordable housing on hand, an enviable lifestyle to enjoy and the cost-of-living isn t too shabby either particularly when compared to Sydney and Melbourne. The downside has been jobs growth. While this figure stays subdued, less new residents than we rightly deserve are crossing the border to make Brisbane their home. History suggests things will turn around, but we are in a wait-and-see pattern at present. Our property is trading well and prospects remain positive (except for small high-rise apartments pitched at out-of-town investors. Frankly, those remain a bit dire) but until we can see a tick-up in job numbers, then don t expect a boom. As we ve already alluded to, property is a relatively affordable affair here in south east Queensland, so our demographic of homeowners is broad there really is something for everyone. First homebuyers tend to have budgets that are sub- $500,000 and those looking for detached houses tend to haunt the city s fringe. Big new estates to the north in North Lakes, Mango Hill and Griffin are popular. The Ripley Valley to the west has also become a go to for young buyers, and Ipswich stalwarts such as Collingwood Park and the megadevelopment of Springfield Lakes are attractive too. Southern suburb first-time buyers are active around Logan. As most first buyers graduate into long-term relationships and expanding families, they will generally find their income rises as well. This familybuyer set will look for a home across all areas - inner, middle or outer ring suburbs with their budget being the determining factor in most cases. Other drivers for this demographic will be proximity to fundamentals. Schools, shops and transport please, would be their catch cry. Certainly, most still want the great Aussie dream a detached home with plenty of space on a good size block so the kids can exhaust themselves running around the yard. That said, there s a rise in the new family as well, where clever house design can allow them to adapt to a smaller plot of land. There s even been claims that Brisbane hipster families could be among the first generation to make apartments home to a growing brood. Certainly, this approach to housing is a distinct possibility, but while homes with land remain reasonably affordable, it s hard to imaging these buyers flocking to attached living in great numbers. Most family homeowners would be budgeting up to the $1 million mark if they re looking for a decent size, mid- to inner-ring home on its own block. Empty nesters are another homeowner subset on the move. This group are looking for all the good things in life without the hassle of a large house to clean. The new generation of empty nesters who haven t quite flown into grey nomad status, are buying good quality apartments with plenty of room for when the kids, or grandkids, want to drop in and stay over. While some fancy themselves inner urban elites, there s also a fair chunk of this demographic enjoying the middle-ring locations as well. Most of all, facilities should be in easy reach hospitals, shopping and transport would certainly be among the mix. Most are selling out of their long-held family home and enjoying the CGT-free outcome to purchase a quality apartment. The result is, many will fork over up to $1 million for the right type of abode, even more if they want to be right in town where the action is. For all homeowners, there s a difference in the elements of a property that will appeal to them when compared to the investor buyer. They want a good quality finish with plenty of space. It would be nice to enjoy low maintenance, although this won t be a deal breaker for those who like to potter and tinker around their own bricks and mortar. Of all the demographics at the moment, the most active buyer group seems to be the retirees. No surprise, given our ageing population is looking to downsize and enjoy themselves. For Brisbane homeowners, there have always been the coastal options too with a relocation north or south, but for those retirees that want to remain a little closer to 42

23 the big smoke and the water, some might elect to choose the Redcliffe Peninsula, Redlands area or around Manly. One of the flow-ons for Brisbane as a result of this retiree shift is the domino of home ownership upgrades. As the older generation graduates out to their retirement, families hunting for their second or third home start making their way into the inner suburbs many with a view to renovating the stock left behind. The other big home-ownership move we re seeing in Brisbane is one of non-home ownership. Younger generations seeking lifestyle but keen to have a foot in the market are looking to purchase their first investment in an outer suburb affordable, accessible and well serviced addresses and then rent in near CBD positions where they can enjoy all the benefits that 20 and 30 year olds hanker for. If the idea of fringe ownership is abhorrent to them, then more than a few are re-assessing their view on detached housing and instead looking to settle in a townhouse or unit. Some savvy youngsters are making second-hand unit stock in prime positions within five kilometres of the CBD their first home. If it could do with a little renovation, all the better. Their plan is to take advantage of the currently subdued market and then use the unit as a portfolio starter when it comes time to upgrade. It s a nice idea if you have the finances and a solid long-term plan. Toowoomba The Toowoomba and surrounding residential property market remains steady at present with low sales volumes wide spread across all sectors. Being one of the more affordable regional locations in Australia, Toowoomba and surrounding suburbs offer an opportunity for many different types of home owners. With various industry and job opportunities, a central hub location, a diverse property market and varying segments, there are many different home owners whether first home owners, families, or empty nesters. While lending has tightened and property ownership has become more difficult for the next generation, there are still good opportunities in the Toowoomba region to become a home owner. Strategies such as joint ownership can also bring affordability to young people getting their foot in the ownership door and out of the rental market. The typical product attractive to first home buyers tends to be in the sub $450,000 segment, being new 2- and 3-bedroom units as well as 3- and 4-bedroom houses located in active investor areas in the western suburbs of Toowoomba and satellite suburbs such as Cambooya and Wyreema. The other trending option is to buy older housing in more established areas. Families generally seek slightly different properties to first home buyers, with a focus on more space (i.e. 4-bedroom houses), bigger back yards and close proximity to schools. This type of housing is found throughout Toowoomba, Highfields and Westbrook in the sub $600,000 segment. Empty nesters seem to stay put in the family home or down-size to unit or villa living and seem to fill the higher priced property segment. Attached housing and detached housing on small lots are tending to grow in popularity throughout the Toowoomba area, particularly in the older areas close to the CBD. The dream of having a big back yard appears to be changing. Many infill blocks have been sub-divided into smaller lots or have had unit complexes built on them. This type of product may be attractive to empty nesters looking to downsize for maintenance and convenience reasons. Attached housing is also becoming more appealing to first home buyers for affordability. This product is often more suited to home buyers than investors due to costs for the location and resulting returns on capital. The sector in the home buyer s market which appears to be most active is upgraders looking to get into a bigger house or a more desirable location. Properties in areas such as Rangeville, Middle Ridge, East Toowoomba and Mount Lofty seem to be what is sought after by this sector. 43

24 Gold Coast North-Western Gold Coast and Lower Logan The northern (Gold Coast/Southern Logan) corridor provides affordable options for home owners, being cheaper than its central and southern Gold Coast counterparts, especially since the improvement of the Gold Coast market over the past few years. First home owners are active in this area. They can purchase house and land packages from the high $300,000 mark to $500,000 in a number of suburbs such as Ormeau, Ormeau Hills, Pimpama, Holmview, Bahrs Scrub, Yarrabilba and Flagstone. The Queensland first home owner s grant and low interest rate environment have also contributed to this market. First home owners also purchase affordable older or semi-modern detached dwellings and attached duplex and townhouses or units within the $280,000 to $400,000 range, especially in suburbs where the detached house may just be out of reach. Families are active in detached home ownership around the $400,000 plus mark in suburbs such as Upper Coomera situated near schools, transport, shopping and infrastructure. Families upgrading and looking for space and lifestyle have also been purchasing rural acreage detached housing in areas such as Kingsholme and Jimboomba. An example is Montego Hills estate in Kingsholme (approximately 30 kilometres north of Surfers Paradise and 45 kilometres south of Brisbane CBD). This estate offers vacant rural residential allotments between one and two acres ranging in price from $370,000 to $480,000. These blocks are being purchased by families and upgraders wanting the lifestyle block and space. Empty nesters typically purchase attached duplex/villa/unit type accommodation starting from $280,000 plus with low maintenance and affordability in mind. Home owners tend to look for accommodation to cater for their needs. For example families will purchase homes that include larger or multiple living areas and yard space, whereas investors will purchase housing that will maximise yield return, opting for more bedrooms and less living areas and yard space. The next generation have not given up on the idea of home ownership within the northern Gold Coast corridor due to the affordable options provided, especially when prices within the central and southern Gold Coast precincts start at the $550,000 to $600,000 mark. Northern Gold Coast The northern Gold Coast typically represents an established market with first home buyers not a large or very active market segment. Agents are reporting that a lot of the first home buyers that they do see are now struggling to get mortgage approval with some sale contracts failing to transact. First home buyers in this locality typically favour semi-modern circa 1980 to 1990s, 2- and 3-bedroom duplex and townhouse style units. This product is priced from around $330,000 to $380,000 and is located in the central areas of Southport, Arundel and Labrador. Affordability is the main driver for the first home market in this area and there has more recently been a strong and obvious trend towards attached style housing. Preferences with regard to proximity to schools, public transport, the CBD, hospital or university and proximity to Broadwater are front of mind for this product type, with the more bedrooms the better and then buyers will look at the condition of the improvements. The market on the northern Gold Coast is driven by two main sectors being local upgraders and people migrating to the coast from interstate or Brisbane. Buyers in each of these sectors are looking at improving their life styles. The Gold Coast is a desirable location and upgraders are motivated by improving on their quality of home and location, i.e. canal, golf course and Broadwater locations. Potential first home buyers are now looking at lifestyle more and more and seem to be renting in a more desirable location, however this comes with 44

25 the potential of being caught in a rental trap. Rents have strengthened over recent years and would be impacting on the ability of many to save a deposit for first home investing. Central Gold Coast Home owners have been very active in the central areas of the Gold Coast over the past twelve months, however it has become evident in the past few weeks that there is now a lack of urgency to move. In most cases, buying property in this particular patch is seen as a lifestyle decision for owner-occupiers. Beachside or waterfront property are typically the most sought after. The market for residential property that offers beachside living or boating access has been quite strong over the past two years. Mermaid Beach property has been very popular for those wanting to live by the beach. This suburb offers a variety of housing choices from small walk-up units to duplexes to large beach front homes and property here is always seen as an attractive investment because it offers something for home buyers of all budgets. Broadbeach Waters has been arguably the best performing suburb in terms of price growth in the past five years and housing in this suburb is primarily dominated by canal front dwellings. Entry level for waterfront housing would be around the $800,000 level. It appears local home owners are becoming aware that prices have shifted upwards significantly over this period. There is a sense that home owners realise that the market may be close to overheating. Whilst most home owners would be confident of achieving a good result if they had their property listed on the market, many would also be concerned of having to pay an over the top price to re-enter the market if they wanted to upgrade in the same suburb or shift to a neighbouring locale. There is a real lack of stock for most property types in the central suburbs, except for highrise apartments in Surfers Paradise, which is more of an investor-driven market. A typical first home buyer in the central areas of the Gold Coast would most certainly desire to invest in detached housing in a central locale, however in the current market it would be quite difficult to find this opportunity. A buyer would be expected to pay more than $600,000 for an entry level 4-bedroom detached house in Robina, a suburb which is a few kilometres away from the beach. There are still some affordable detached housing opportunities in suburbs such as Carrara and Mudgeeraba in the $475,000 to $550,000 price range but agents report that demand for these type of properties is far outstripping supply. We are seeing a trend where many first home buyers in this area are willing to sacrifice the dream of having a detached house in a central spot and target something smaller in living size (e.g. a townhouse) but it must have modern finishes. Home owners who consider townhouse living as an option are also looking at properties which can offer suitable car accommodation and at least have proximity to amenities such as shops and schools. Even with the low interest rate environment, we have not seen a huge amount of sales activity that has originated from first home buyers over the past few months. Properties in this area are generally in the higher price bracket, being out of reach for the large majority of first home buyers. Some developers who have built townhouse or low to medium rise projects in Robina and Merrimac have had reasonable success in selling new product to first home buyers and owner occupiers this year. With the Gold Coast residential property market appearing to show signs of overheating in most coastal suburbs, it s probably not the best time for first home buyers to enter the market right now. Those home owners who have been mulling over selling or even down sizing should possibly look at renting as an option in order to avoid re-entering a hot housing market. The Gold Coast property market can be volatile at times and should interest rates spike or economic conditions soften over the upcoming months, the thought of owning a home will be less gratifying. Central West Gold Coast And Lower Logan In the central west Gold Coast and Lower Logan areas it appears a lot of purchasers are home 45

26 owners and less are investors due to the locality and lower price compared to central localities. The cheaper prices are attracting home owners who were previously renting and want the my home feeling. Deposits for the contracts appear to be less than 5% in a lot of instances. In the central west and western areas, home owners appear to be young couples getting their foot in the door as prices appear to be cheaper than the central coastal areas. They are typically purchasing new products, particularly throughout the new Maudsland estates, as well as small villas and townhouses within complexes. Out west, it appears established families are upgrading to larger properties in superior localities such as Tamborine and Cedar Vale. Central western localities offer good value for money with prices for dwellings such as an older style, 3-bedroom in Nerang being circa $400,000 and a semi-modern, established dwelling in Carrara being circa $550,000 to $650,000. New stock in Maudsland is priced between circa $500,000 and $650,000 depending on the size and quality, etc. This still offers good value for money being within close proximity of the M1 and major shopping centres. Out west, prices vary significantly depending on the property type, from $300,000 in Beaudesert for an original dwelling within the township to $600,000 plus for larger acreage properties. First home buyers are leaning towards any affordable product in suburban areas (attached or detached) and out west, home owners (minimal first home buyers) appear to be attracted to larger land areas with good quality ancillary improvements. It appears home buyers are attracted to the price, age and accommodation. Accommodation is typically seen in 2-bedroom duplexes throughout Oxenford, where garage conversion to a bedroom is becoming more typical. Home owners attraction to new products is seen throughout central western areas amongst townhouse villa projects such as Hilltop Villas in Carrara and new townhouse projects west of the M1. We are occasionally pulling back prices within these complexes. Throughout central west and western localities, there appears to be a mixture of first home buyers, upgraders and sideways movers with an evident attraction to central localities for first home owners and larger, older properties for upgraders. There appears to be minimal retirees throughout the central west localities, however we have come across a few instances of retirees selling in order to relocate to a retirement home. We believe the next generation has not given up on home ownership and are strongly attracted to owning their home. The current prices and competition in the market appear to make it more unrealistic within central west and western localities, however it is very circumstantial to the state of the market and economy when the time comes. We have seen a strong mixture of home owners and investment properties throughout central western areas as there is no appealing lifestyle in western suburban areas, however it appears larger properties in the western areas are definitely favoured for lifestyle, however these are typically owner occupied. Southern Gold Coast & Tweed Coast Home owners/buyers are very active in the majority of areas on the southern Gold Coast with the majority of sales being to families relocating to a coastal suburb. In the higher price brackets, we are seeing a number of interstate buyers migrating north, however the majority of agents believe that properties being purchased by interstate buyers are for the owners to occupy in the near future rather then investment purposes. The market and property values have improved considerably over the past few years and areas such as Burleigh Waters, Elanora and Currumbin Waters have been popular with families as they are within close proximity of the higher priced suburbs and 46

27 beach side areas of Burleigh Heads, Miami, Palm Beach and Currumbin. Entry level housing in Burleigh Waters, Elanora and Currumbin Waters is typically around the $600,000 mark for a detached dwelling and depending on the position/location and quality/size of improvements, this can vary up to as much as $1,200,000. There has been a substantial amount of older homes demolished in our coastal areas with new attached housing and duplex units being constructed. These modern duplex units are also very popular in the market place and are attracting record sale prices for modern, low maintenance and easy lifestyle properties. With duplex units, home owners prefer to have a double car garage and additional living rooms whereas investors are after more bedroom and bathroom accommodation with living areas and car accommodation not appearing to be as important. One sector of the market which has improved considerably over the past few years is the older style, attached duplex units with yard space. As the entry level price for detached housing has risen, first home buyers have been priced out of buying a freestanding house and rather then buying a unit within a complex with body corporate fees, the older single level attached duplex units have become very popular in the marketplace with buyers wanting an outdoor living space and yard area for kids and pets. The next generation of buyers appears to still be active, however the higher the price the thinner the market. Sunshine Coast Home ownership is still the dream for most people living on the Sunshine Coast and owner-occupiers are again making up the majority of sales, particularly since APRA announced changes to investor lending. We are seeing first home buyers still very active throughout the more affordable hinterland townships as well as in the new small lot residential estates at Caloundra and Palmview. Land in these estates is selling before titles are issued and is very popular amongst first home buyers. The Sunshine Coast is seeing some change with several new high density unit developments recently completed around the new hospital precinct and a large supply of small lot developments providing affordable housing. Lot sizes above 500 square metres are becoming scarce along the coastal strip and the number of attached housing developments is increasing. Both of these residential options provide an opportunity for first home buyers to get into the market at around $400,000. Investors are also active for these types of properties at this price point. Upgraders are also active given the ability to exit out of their current home. Also the Sunshine Coast has always been a popular destination for retirees seeking the sea change. This group of buyers makes up the majority of the market for the better family homes along the coast and rural residential properties inland. Upgraders are more active in the $600,000 to $1,000,000 price range, with the main reasons being the want of a larger dwelling or a property in a more desirable location. This price range will still secure good quality properties right up and down the coast, from units with views to a family home within walking distance of the beach and are still considered affordable in comparison to Sydney and Melbourne. The prestige market is dominated by upgraders and retirees with a fair chunk of buyers coming from Brisbane and the southern states. These buyers make up the majority of million dollar plus residential sales on the coast. Whilst some well located good quality units sell in this price range, the majority of million dollar plus sales are beachside and canal front dwellings or larger hinterland properties, many of which afford views. The residential market in general is still moving along nicely. Vacant land is still very popular and most agents are reporting difficulties in securing listings at present. Anecdotally we hear that owners 47

28 are reluctant to sell at the moment as they are anticipating that there will be a further improvement in future capital growth. First home buyers, upgraders and retirees are active in the market which is unlikely to change given we live in a great part of Australia. The great Australian dream of home ownership is still alive and well on the Sunshine Coast. Hervey Bay Hervey Bay has traditionally been an owner-occupied market generally due to its beachside location and affordability. The boom period of 2006 to 2008 saw investors take advantage of cheap property compared to their local southern markets however some of these initial investors are now local residents. There are many different housing options for home owners including villas, townhouses and units close to the foreshore, existing detached housing or vacant land with a view to building their new home. Land generally starts from around $150,000, established older housing ranges from $250,000 to $450,000 up to esplanade and beach front property in excess of $750,000. New turn key house and land packages generally offering 4-bedroom, 2-bathroom accommodation with a double garage ranges from $375,000 to $500,000 depending on the estate. Land sizes also vary considerably from the older, traditional 800 square metre to quarter acre block down to 400 square metres in some of the new estates. Some acre or larger lots are still available however zoning changes have seen quite a lot of these larger blocks now being subdivided. First home owners were active over the past two years however this now appears to have slowed as a consequence of local government incentives no longer being offered or offered at a reduced level. Appetite for homes requiring renovation is improving with older beach shack property being prime targets due to location. The rental market has also been strong for a number of years now with a 4-bedroom home receiving $360 to $400 per week. This return has maintained an investor presence in our market. Most investor activity is however in the new estates which also has tax benefits for new homes. Generally Hervey Bay has a balanced market between investors and owneroccupiers with an adequate supply of all property types for a potential home owner. Bundaberg The Bundaberg home owner comes in many forms, with first home owners, upgraders, families and empty nesters all being relatively active within the Bundaberg residential markets. The most active localities are the coastal corridor around Bargara and the suburbs surrounding the city. Recently buyers have had a preference for established houses with the volume of sales having a slight increase at the expense of vacant land and unit transactions. Due to the relatively affordable level of housing throughout the region, Bundaberg remains attractive to all types of home owners. Emerald Home owners make up approximately 95% to 99% of the current market. They are active in all price ranges from $200,000 to $600,000. There is a quiet confidence starting to filter around the town that the resource sector has stabilised and employment demand appears to be trending upwards slightly. If coal prices remain where they are or improve we will only see the employment demand increase. Purchasers appear to have more confidence in the market being stable or perhaps firming over the next two years. Those moving to town for work think our house prices are good buying (compared to the east coast and south east corner). Renters have been active in purchasing homes and some are choosing to upgrade. Good value for money is across all types of properties. Many in town purchased during the boom period of 2005 to 2012 and now owe more than their property is currently worth. Had they still had equity or could sell and break even the upgrade market and local investor market would currently be very active. Gladstone The landscape of the Gladstone property market has changed dramatically in five short years. During the boom, the market was dominated by investors trying to cash in on the hype that surrounded Gladstone. 48

29 Value levels and rents were the highest Gladstone had ever seen, vacancy rates were essentially 0%, motels were running at 150% occupancy, etc etc. They were crazy times! Fast forward five years and the property market could not be more different! You would be hard pressed to find a property owner who has not suffered some sort of loss in the past few years. On the other hand, the buyer s market we currently find ourselves in has attracted many different types of home owners to the market. The affordability of property in Gladstone has turned us from one of the most expensive places to live in the state to one of the cheapest. Value levels have not been this low for nearly two decades. We have seen a large contingent of first home owners enter the market. First home buyers appear more active in the sub $400,000 market for both existing and newly constructed homes, however if purchasing existing homes they are generally looking to buy at a lower price point. Upgraders are also taking advantage of the current affordability. These buyers are typically looking for detached housing with space for the children, both internally and externally. Proximity to infrastructure such as schools and shopping play an important role in these buyers decisions. Investors have slowly been starting to re-enter the market over the past few months. While the properties being purchased vary, most are looking for long term capital gains as the rental yields are likely to remain very low for a while yet. Overall, the dream of home ownership in Gladstone is definitely easier and within reach for many more aspiring home owners. Rockhampton The great Australian dream is an ever changing ideal for many Australians and in Rockhampton it is no different. There are many different housing options which a potential home owner can purchase, including inner city apartments, existing detached housing or vacant land with a view to building their new home. For each of these options, there are various price points ranging from $100,000 to in excess of $750,000. First home buyers appear more active in the sub $450,000 market for both existing and newly constructed homes, however if purchasing existing homes they are generally looking to buy at a lower price point. Second plus home owners are typically upsizing or upgrading and their budgets vary depending on their desired location, house size and quality. Second plus home owners generally have families and are looking for detached housing with space for the children, both internally and externally. Proximity to amenities such as schools and shopping play a particular role in an upgrader s decision. The retirees of the area have in the past typically migrated to the nearby coastal towns of Yeppoon and Emu Park, however over the preceding years, there has been an increase in the number of inner city high-rise residential towers which provide a great lifestyle for those looking to downsize and reducing property maintenance which has proved popular. Home buyers are the most prevalent buyer in the current market, with limited appetite from investors. Overall a consistent theme from first home buyers to upgraders and retirees is that there appears to be an overwhelming preference for better maintained and presented properties that require minimal, if any work. With a large number of properties on the market, buyers are discerning in what they are buying, however the right property at the right price will still attract plenty of interest from potential home owners. The major difference between home owners and investors would be that home owners are more concerned with location, price point and quality compared to investors who are focused on maximising returns. The dream may be changing, but it is still well and truly alive in Rockhampton. 49

30 Mackay This month we discuss home ownership and its different forms within our markets. It s such a broad topic that got us thinking about how the Mackay residential market and home ownership possibilities have changed over say the past three to five years. Prior to 2013, Mackay had one of the highest median house values in regional Queensland sitting around the $430,000 mark in 2012 and one of the major issues facing the market was affordability. Mackay had a reputation as a mining town and was often not on the radar for professions such as teachers, police, ambulance or entry level job seekers not related to mining because of the high rents and purchase price for dwellings. Even in our own business we found it extremely difficult to move our trainees to Mackay because of the high costs associated with housing. However, since the downturn in the resource industry and flow on effects to the Mackay residential market, we saw significant falls in both house prices and rental levels across the board. This downward cycle lasted well into 2016 and saw median house prices drop by over $100,000 to sit at around the $315,000 mark, with many properties available for under and in some cases well under $300,000. While this result was has been difficult to take, it has presented opportunities in Mackay not seen in over 13 years. The issue of affordability and the ability to move nonmining related staff and employees into the region has become easier. For example, we had an assistant valuer move to Mackay in 2012 to further her training and she was paying $375 per week rent for a small 2-bedroom walk up flat with poor quality fitout, with virtually no prospects of being able to purchase. This level of rent was unsustainable and she moved south to further her training. Since the downturn, we have been able to transfer one of our junior valuers to Mackay who now rents a 3-bedroom dwelling in Beaconsfield for $250 per week and is on the hunt to purchase a dwelling. I imagine this scenario is being played out across a variety of industries in Mackay. This new level of affordability isn t just rewarding the lower end of the market. We have seen this across most sectors of the market from first home owners to middle level upgraders, even to the top end prestige market. For example, in the boom to purchase good quality executive dwellings in the newer estates such as Northview Gardens, you were looking at the $600,000 plus. This may have been out of the reach of some purchasers. Since the market has fallen, we have seen a number of sales within the estate at between $450,000 and $500,000, which when combined with record low interest rates becomes more achievable. Overall, the dream of home ownership in Mackay has become that much easier! Whitsunday Here in the Whitsundays it appears that we are just starting to bounce back since Tropical Cyclone Debbie hit us with all her force and more! At present there appears to be movement in the land sales area with new home buyers and upgraders jumping in and looking to build their dream home. The only problem is that there is a limited number of tradies and lots of them are working on the insurance work caused by the cyclone. There are still so many people waiting for repairs to their homes to commence and homes being sold in their present state with the owners signing over the insurance claim to the incoming purchaser. It is far from the normal here in the Whitsundays but it is bouncing back. There are still some southern investors entering the market but these appear to have slowed. The rental market has moved as you can imagine with the additional tradies here to complete the insurance work and the locals not able to live in their houses while repairs take place pushing the rental market. 50

31 Townsville Activity in Townsville s residential property market is currently dominated by owner-occupiers with a number of these buyers being first time participants in our local market. Sentiment is building in Townsville s residential property market which is consolidating at the start of recovery phase, although the market is showing a dichotomy with the recovery in the housing sector advancing, whilst the market for land and units continues to teeter. First time participants in the local market are buying houses across most suburbs of Townsville and include a mixture of new, semi modern and older style homes. This sector of the market would appear to be mostly active in the $300,000 to $400,000 range. Other owner-occupiers include upgraders moving from units to houses, renovators, those moving to superior locations and downsizers. This market encompasses a wide range of values and suburbs. Townsville s median house price remains soft and it would appear that first time participants in the market have realised that now is the time to buy with record low interest rates, good affordability and a buyer s market creating favourable conditions for these buyers. Cairns The Cairns market is best described as a steady state market that has been flatlining for some time, but nevertheless maintains a reasonable balance of market power between buyers and sellers. However it is the homeowner sector that is mostly sustaining the market, with the investor sector progressively thinning out. Cairns houses presently demonstrate a mainstream market ranging from around $250,000 to $750,000 in price, with a median level of $405,000. The primary home buyer market typically consists of a mix of first home buyers, upgraders, downsizers and relocators from out of town. Due to an absence of new apartment construction, first home buyers wishing to utilise their grants are restricted to houses in mid to outer suburbs, where we are seeing estates for instance from Bentley Park to Gordonvale active in the $380,000 to $420,00 range with first home buyers as a target market. People relocating to Cairns from out of town, including cashed-up buyers originating from southern capitals, sustain a variety of housing styles and price points in the market and are a key demand element in areas such as the northern beaches. Meanwhile the investor market, where it exists, typically confines to the sub $450,000 market. This arises due to purchases above this level becoming less attractive rental propositions. For instance a new 4-bedroom, 2-bathroom house in Gordonvale with a purchase price tag of $375,000 is liable to rent for $395 to $400 per week, but when the ante is upped to a $450,000 house in the same area, the achievable rent only rises to around $450 per week due to the market topping out for affordability reasons. Buying decisions in the Cairns market have little to do with price levels and affordability. Indeed on the affordability score the Cairns market scrubs up extremely well compared to the overheated markets of the southern capitals. The stumbling block in the Cairns market is more about job security and the confidence to borrow, but this is gradually recovering as tourism and development continue to rebuild. 51

32 South Australia Adelaide Home buyers are active in the Adelaide market at present. The typical catch cry regarding proximity to the CBD consistently applies to the market. Detached housing (character in particular) within proximity to the CBD continues to be appealing for home buyers. There is consistent market activity from second home buyers, particularly those upgrading to a larger and/or renovated dwelling. There appears to be increased upward pressure on properties in this price range as first home buyers are consistently older than previous generations. This is causing some competition in the market as this market segment has been typically saving for a deposit for a longer period of time and is keen to secure a property. A typical home owner in Adelaide is a family although there is continued activity from investors particularly in suburbs undergoing in-fill development. Discussions with some local agents have suggested that interest from investors in some areas has slightly declined in recent times since the recent rate rise in investment loans and the tightening of lending policies for apartments. Detached housing continues to be regarded as better by home buyers in the Adelaide market. Purchasers seeking quality property in proximity to services and the CBD are having to reconsider their options in this regard due to upward pressure on prices and decreased supply. There is increased advertising of apartment complexes in the Adelaide CBD directed towards retirement living. We understand a soon to be completed complex on South Terrace has been primarily sold to home owners down sizing from large family homes. We will continue to monitor this market for changes in future. Home buyers looking at attached housing may seek out higher quality fittings and fittings whilst an investor is typically seeking a low maintenance property with potentially less regard for high quality items. Also, investors generally prefer newer housing due to potential depreciation benefits. The market on the move in Adelaide continues to be purchasers upgrading to larger properties, typically family homes. It is becoming increasingly difficult for purchasers with a single income to enter the market at this price point without a substantial deposit to cover stamp duty in particular. Some home buyers are purchasing their first property as an investment whilst continuing to reside in share accommodation or in their family home. As a result, there are less empty nesters as older children remain at home for longer. Mount Gambier Within the Mount Gambier region, home buyers are presently active in the current market. The graph below shows house sales increasing since 2014, with 2017 appearing to continue in a similar trend. With interest rates still at low levels and the local market showing stronger demand than in previous years, it is likely that these sales numbers will remain stable throughout Under the current market conditions we do not see a foreseeable decrease in sales numbers. In the $500,000 to $800,000 price range, there is always activity in city fringe suburbs. Home buyers who can purchase a quality property under $500,000 within proximity to the CBD are typically in an appealing position. The next generation in Adelaide haven t given up but are having to reconsider their options. Detached housing is less attainable in some areas and first home buyers will need to consider attached housing, townhouses or units as possible alternatives. 52