Categories
Vic

Surge in Ballarat land price could spark affordability crisis for wider market

A regional land boom could make a patch of dirt in Ballarat’s new housing estates worth as much as those in Melbourne by Christmas.

Other regional centres within striking distance of the capital are also at risk of home price booms that could cause a years-long affordability crisis.

Analysis by Research4 director Colin Keane shows Ballarat’s average block has soared from
$175,000 to $260,000 since the pandemic hit. 
He predicted the figure would surpass $300,000 and reach parity with Melbourne’s median blockcost before the end of this year as the city’s supply of land was rapidly eroded by growing numbers of people heading out of metropolitan areas — manynow driven by a desire to escape urban life rather than affordability.

“We are seeing a Covid-induced change, people want to be there (Ballarat),” Mr Keane said.

“The demand is there to be outside of the urban footprint. And if they can’t get a lot, they will turn to the established market and that will push the house prices through the roof.”

He claimed the issue was being compounded by town planners releasing land for sale based on 2019 data, when just over 600 lots sold in a year. In 2020 there were 1750 lots sold. This year the figure is expected to top 1800, with 924 sold in the first six months of 2021.

Mr Keane said Ballarat wasn’t alone, with land planning shortages in other regional hubs such as the Macedon Ranges, Bendigo and Warragul also potential risking affordability issues.

“If they don’t act quickly then that demand pressure will move to the established housing market and they will face an affordability crisis,” Mr Keane warned. 

“To prevent that, they need to fast-track any new subdivisions already in plans. ”Geelong’s median lot price has been matching Melbourne’s more affordable new housing growth corridors for a number of years.

Resi Ventures boss Khurram Saeed said he had a 500-lot subdivision to Ballarat’s north that could be available for sale by 2022 if the local council fast tracked approvals, but was currently expected to hit the market in 2024.

“We’re not asking for special treatment, however unless something is done to fast-track the land rezoning, the Ballarat unmet land development market is facing a supply black hole,” Mr Saeed said.

PRD Ballarat director Jason Birch said there had been a notable surge in land and house prices across the city, with a property that would have cost $450,000 now worth over $600,000 and instances of those who had bought land selling it for tens of thousands more before it had even been titled.

But Mr Birch said even if a block wound up costing as much as one in Melbourne it would likely be substantially larger than you would get in the big smoke.

“I don’t think it will be a crisis,” Mr Birch said. “But there will be people who find it difficult as prices for everything are rising, but wages aren’t.”

He added that the wage gap between those employed in Melbourne and those in Ballarat would also impact affordability, with first-home buyers squeezed out  also likely to struggle to access a rental property amid heated demand.

City of Ballarat development and growth director Natalie Robertson said the city had 1290ha of future urban expansion in the Ballarat West Growth Area and is looking for other opportunities.

“In addition, the City of Ballarat is currently preparing an affordable housing policy to provide for the delivery of different affordable housing models in Ballarat in close consultation with key state government agencies,” Ms Robertson said.


From The Sydney Morning Herald

Categories
NSW Qld Vic

PROPERTY EXPERTS REVEAL WHERE TO INVEST IN 2021

Despite all the pandemic-induced drama, 2020 turned out to be a pretty stable year for property prices in Australia. Most experts believe that this new year will shape up to be stellar for real estate. Property Investment Professionals of Australia (PIPA) chairman reinforced that 2021 will be a much better year than 2020, especially for the residential market, as capital cities are expected to see a higher rate of value increases.

Furthermore, historically low interest rate and pent up transactional energy are likely to provide a boost to the property market early in 2021, as this will continue to push the prices on established residential properties up.

If Australia succeeds to keep COVID contained in 2021, the property market will look to be a promising year, especially on the back of record low interest rates and positive sentiments, Property investors Council of Australia’s chairman Ben Kingsley.
Here are where the experts are highly recommending to invest in 2021:

Lifestyle Towns

Regional and lifestyle property markets have shown some very strong results. Demand has been outstripping supply by some margin and this has resulted in short marketing periods, properties sold prior to auction as well as some very strong auction results. Locations such as the Sunshine Coast and Adelaide Hills are stands outs with the advantages of rural lifestyle and good value attracting buyers.
CoreLogic’s “Best of the Best” report revealed Sunshine Beach, a suburb of Noosa in Queensland, had the best performing house prices over the past 12 months.

In just one year Sunshine Beach’s house prices rose by an eye-watering 27.6 per cent, the largest capital gain in one year of any suburb in the country.

CoreLogic’s Head of Research Australia, Eliza Owen said “Sunshine Beach on the Sunshine Coast has seen the highest annual capital growth in houses nationally, compared with 2019 when St Kilda in Melbourne saw the highest housing growth.”

Regional Victoria

Areas such as Geelong, Ballarat and Bendigo are likely hotspots due to affordability and lifestyle factors. Despite the ongoing pandemic, regional Victoria house prices increased by 5.5 per cent. CoreLogic research director, Tim Lawless said the hottest markets were only a few hours drive from major capital cities, such as Geelong, Ballarat, Sunshine Coast, Newcastle, Wollongong and Daylesford. “They are leading the pack in terms of the strongest growth”.
“People can have the best of both worlds and live in a marketplace with lifestyle benefits and lower prices, as well commute back to big cities if they need to,” Mr Lawless said.

Greater Byron Region

As mentioned in our last email, the Greater Byron Region is set to boom in 2021. Increases in buyer’s demand were across the Greater Byron Region in locations such as East Ballina (185%), Lennox Head (150%) and Bangalow (145%).

Categories
Vic

PANDEMIC FEARS HAVEN’T SHAKEN BALLARAT HOUSING MARKET

DESPITE THE MYRIAD OF SOCIAL AND ECONOMIC CHANGES THAT HAS OCCURRED THROUGHOUT THE PANDEMIC, BALLARAT’S HOUSING MARKET CONTINUES TO STAND STRONG.

WHETHER PEOPLE ARE INVESTING IN THE REGION BECAUSE OF THE LIFESTYLE, HOUSING AFFORDABILITY OR JOB RE-LOCATION, INDUSTRY PROFESSIONALS HAVE BEEN NOTICING THE AREA’S CONSISTENT GROWTH FOR YEARS.

According to industry figures, Ballarat’s house prices rose by 9.7 per cent to a median of $395,000 just last year and jumped 38.6 per cent over five years.

One Agency director Shani Stevens said that due to COVID-19, the supply shortage of houses on the market is keeping rates up and continuing the economic growth in the sector.

“It’s a real seller’s market at the moment because there’s a lot of demand,” she said.

“People don’t want to make any life changing decisions right now which has slowed the supply and kept the prices up.

“The COVID crisis is playing into the hands of regional Victoria in a way because the idea of working remotely has gone from a fantasy to a reality.”

The forecast completion of the GovHub for early 2021 which is set to bring 600 jobs from metropolitan areas to Ballarat is a factor for the rise in inquiries from Melbourne buyers.

Not only does this demand hold prices up, but Ms Stevens said large scale commercial projects like this are a great way to decentralise workers into regional areas.

“There is still a really good level of inquiry and a lot of it is coming from out of town,” she said.

“The GovHub will be a really good model for other large businesses that can work in a decentralised model and come to a regionalised setting.

“They save so much money and if they don’t have to pay those exorbitant CBD rates, why would they?”

Although property prices have stayed stable throughout the pandemic and are looking to continue that way in the future, some industry professionals have noted that buying behaviour has changed.

Harcourt’s real estate agent Tim Menz said although the prices are stable, housing supply is the driest he has seen it over the last decade.

“Because of COVID, some people are sitting on their hands and others might even be worried about putting their house up for sale and having strangers look through their home,” he said.

“Normally 40 per cent of sales would be to investors and currently it’s at 10 per cent so it seems like they’ve disappeared out of the market.

“Although it’s a little bit different right now the housing market in Ballarat is still strong.”

Rumours of a market crash have been circulating since the beginning of the pandemic and as we enter the second round of stage three restrictions, some experts are bracing for the fall.

Domain economist Trent Wiltshire said regional areas within a couple of hours of Melbourne will face a softer market over the next year as prices moderate in metropolitan areas.

“What happens in Melbourne will likely affect regional towns,” Mr Wiltshire said. “The downturn spreads outwards.”

However, some industry professionals a little closer to home are disregarding the possibility of a dramatic downturn here in Ballarat.

Mr Menz said that although we might experience a little dip in the market, it won’t have a huge impact when people decide to resell.

“It’s going to have to depend on what happens to the wider economy, there’s been people saying there’s going to be a housing crash for the last 10 years and it hasn’t happened,” he said.

“No-one knows but at this point in time the housing industry in Ballarat is as strong as it’s ever been.”

Although the future of the industry remains unclear, director at Ray White Ballarat, Phillip Lee, is one of many experienced professionals looking forward with optimism.

Mr Lee said as we re-enter stage three lockdown, there’s no reason for us to expect to see prices spiral.

“The median for the June quarter showed Ballarat went up nearly one per cent during the period of stage three restrictions,” he said.

“It’s still business as usual, a strong market and the only thing that has really changed is the way we conduct open houses.

“There’s no reason to see it being any different to last time except for maybe the limitations on Melbourne buyers coming to Ballarat but we don’t know much about yet.”

With the help of the first homeowners and builders grants, some buyers are finding buying a property more attainable than ever before.

Right now, if you’re in a position to buy or sell, Mr Lee said that waiting for a change in the market is never the answer.

“Don’t try to time it because I’ve seen people wait for a crash and pay more months later,” he said.

“You can get home loans for just over two per cent, so it’s a good time to buy from an interest rate point of view.

“IF YOU LOOK AT THE BALLARAT PROPERTIES OVER THE LAST 20 TO 30 YEARS, IT’S A VERY RESILIENT AND STABLE MARKET AND WHETHER IT’S NOW OR LATER, IT’S ALWAYS A GOOD PLACE TO INVEST.”

WRITTEN BY RUBY STALEY –  TIMES NEW GROUP BALLARAT

Categories
NSW Property Information Qld Vic

AUSTRALIA RETURNS – WHY YOU SHOULD LOOK BEYOND SYDNEY, MELBOURNE FOR YOUR PROPERTY INVESTMENTS

Melbourne and Sydney are undoubtedly the most popular cities in Australia. Melbourne attracts countless people into the city. Rich heritage structures, beautiful landscapes, high development and a great sporting culture make Melbourne an attractive proposition to shift base.

Travel guides will tell you that Sydney is the best city to visit in Australia. It’s home to the Sydney Opera House and the Sydney Harbour, two of the most popular tourist destinations in the country. The golden beaches of Sydney have their own set of loyalists from all across the world. Sydney is also regarded as the financial hub of the Pacific down under.

Education acts as a big pull for families in such cases. University of Melbourne and Deakin University are among Victoria’s best places to study. University of New South Wales and University of Sydney rank up there among the most sought after universities. The sheer reputation of these institutions attract not just local Australians but also overseas students into the two big cities.

The rate at which Melbourne and Sydney have grown is twice as much as other cities in Australia. A flourishing economy, good infrastructure and friendly interest rates have seen people flocking towards Sydney. The real estate prices in the city of Sydney has reached a stage where buying property in the city costs much more money. In fact, it features in the top 10 list of most expensive real estate properties in the world.

So does that mean that Sydney and Melbourne have reached a point of saturation? Property experts believe that the market is softening. Flatlines are appearing because of increased real estate prices which are driving people to settle outside of Sydney. As such, it isn’t a problem given that Sydney has a well-connected transport system and Australia has the whole continent to themselves.

Explore the Untapped Potential of Capital Cities

Property experts have advised investors to diversify their portfolio and put their money and faith in booming markets. Adelaide, Brisbane, Hobart and Canberra – major Australian capital cities have been touted to grow at a rapid pace.

Adelaide and Canberra have emerged as top contenders in the property market. Sydney may have seen flatlines in property growth but Canberra, for instance, has so many takers at this stage. It’s the national capital, a seat of all political activity which results in people actively moving out.

The Brisbane Boom

Reports suggest that the value of real estate residential housing in Brisbane has seen a sharp rise. Rapid construction has resulted in an oversupply in available housing. The real estate prices remain affordable for people to settle in. And it’s not just residents or fellow Queenslanders, a lot of inter-state migration has started taking place in Brisbane.

Brisbane is witnessing a lot of migration into the city which balances the oversupply of housing. With everyone earning largely the same levels of income, the time seems right to invest now in Brisbane rather than Sydney and Melbourne.

BIS Shrapnel expects median house prices in Brisbane to increase by 7% come June 2019. Brisbane has seen a jump in the number of IT and Finance firms setting up shop in the city and is one of Australia’s fastest growing economies.  After Sydney and Melbourne, it’s the 3rd most visited city in Australia by tourists. The University of Queensland, Griffith University and Queensland University of Technology are prestigious universities that are attracting overseas students too.

Adelaide and Hobart are quieter cities but like Brisbane, have tremendous untapped scope for growth. Any fears of Sydney and Melbourne reaching flatlines may not be fully true as studies indicate that property buyers have been making close to $100,000 within 24 months of purchase and leasing out of property. But cheaper investments can always be made in the developing cities.

If you are looking to invest in Australia’s real estate, look beyond Melbourne and Sydney. There are more investment havens to explore. With an increasing number of interstate and overseas migrations taking place, Australia presents a great investment opportunity in real estate