DEVELOPERS are showing a reluctance to start new apartment projects with latest figures showing the largest quarterly decline in the commencement of construction in 45 years.
Research analyst Cameron Kusher from CoreLogic RP Data said a report released by the Australian Bureau of Statistics reveals significant slowing down in new dwellings.
According to the quarterly Building Activity data the number of new houses starting construction fell by 7.6 per cent to 27,088 — the lowest level since March 2017.
Construction underway in Sydney
Apartment commencement dropped by almost 27 per cent to 19,134 and the fewest over a quarter since September 2013.
Mr Kusher said it is the largest quarterly decline since September 1974 when the number of unit projects dropped by 32 per cent.
Despite the falls both house and unit commencements remain above their long-term average.
“As the housing market has turned and values have started to fall, we can see there is reduced preparedness of developers to commence new projects,” Mr Kusher said.
“We would expect that commencements, particularly for units, are likely to continue to trend lower over the coming quarters as housing values continue to record value falls, finance remains tight and both domestic and foreign investors remain light on the ground.”
Future projects are more likely to be high-rise developments
The latest Building Activity data shows the commencement of units with one to three storeys has remained relatively steady. The demand/supply ratio of medium density dwellings anecdotally is much healthier relative to high density projects.
While there have been significant increases in taller buildings over recent years, commencements is now beginning to ease.
The trend towards high density living has been driven by Australia’s three most populous capital cities — Sydney, Melbourne and Brisbane. Over the past five years, every State and Territory, however, has seen unit commencement reach historic high levels while detached housing construction has also climbed during this period.
Unit commencement has reached historic high levels over the past five years but is now easing
Mr Kusher expects developers will still continue to opt for high-rise projects to recoup acquisition costs and maximise profits.
“With dwelling commencements is expected to continue to fall, the decline doesn’t negate the fact that many developers have paid high prices to acquire sites,” he said.
“As a result, we would expect that despite an expectation of fewer commencements going forward, those projects that do commence will largely be taller apartment projects.”
This article was first published in www.realestate.com.au. Here is the link to the original article.
What is going to happen next to Australia’s troubled housing market?
Will the whole country keep crashing? There is a difference in the housing crashes around Australia, hidden beneath the headlines, that might provide a clue.
You’re familiar with the price falls — Australia’s capital city average house price is down around 7 per cent.
The total fall is much worse in Perth (down 18 per cent from the peak), and has been especially sharp in Sydney, where prices are down 14 per cent.
Melbourne is not far behind, down 10 per cent.
Adelaide and Brisbane are fairly steady while Hobart is up, its peak is right now.
Regional Australia is down 2.5 per cent, especially regional WA, where home prices are down 32 per cent.
But there’s another way to look at the housing market. Renters. And the renting numbers tell a fascinating story.
In Melbourne, while house prices fall, rental vacancy rates are falling.
It’s easy to find a tenant and rents are rising.
That suggests there is continuing strong demand for housing.
There may, it seems, be a limit to falling prices in Melbourne.
But in Sydney rental vacancy rates are going up. That does make sense, with house prices falling so fast.
Both of those facts suggest people don’t want Sydney housing so much any more.
Demand for housing is Sydney is weak no matter how you look at it
You can see the rental vacancy rates in Sydney and Melbourne in the graphic below, as well as the rental vacancy rates in several other markets.
Renting numbers offer an insight into the real estate market. Source: RBA Statement on Monetary Policy February 2019
Overall, the income Australian landlords are getting from rental properties is growing more slowly. Advertised rents are getting more expensive in Melbourne, but cheaper in Sydney.
Understanding the strength of the rental market is important for seeing the future of the housing market.
Sydney, Melbourne and Brisbane are all set to have a large number of apartments released onto the market in the next few years.
Many tall towers that had their foundations concreted in the boom time will get their final coat of paint amid the bust. Such is the cyclic nature of property development — by trying to meet peak demand, they create an oversupply that fuels the bust. What looks like a rational course of action for one developer might not be rational if every developer does the same thing at once.
If they win the election and change the law, this could cause interesting changes in the property market. It is likely fewer investors will want to buy existing homes any more. That should mean existing homes slowly move out of the hands of investors and into the hands of owner-occupiers.
If fewer rental properties are available, rents might go up. But at the same time, with fewer investors trying to buy investment properties, the price of buying an existing home might come down.
It could be a great time for a renter to become a first home buyer.
This article first appeared in www.realestate.com.au. Here is the link to the original article.
Catching the train from Geelong and into Melbourne should be a dream commute. It takes just over an hour and all the while golden fields, native brush and choked highways whip by the windows.
But in the past five years, the city and its surrounding regions have had a growth spurt. Its population has grown nearly 13 per cent and house prices have jumped 44 per cent.
An exodus of Melburnians hoping to escape a cramped lifestyle have fled to the bayside city, and the first signs of a burgeoning congestion issue have followed them.
The migration was driven by Geelong’s comparatively low property prices, perceived quiet lifestyle and connectivity to the Melbourne CBD.
Anxiety about the city’s growth is permeating the general atmosphere of optimism that followed the transfer of the Traffic Accident Commission, WorkSafe and National Disability Insurance Scheme into Geelong in recent years.
For some time it seemed like the Melbourne’s runaway property market would also take Geelong’s prices to an unattainable level too.
Geelong house prices
HOUSES: YOY GROWTH %
UNITS: YOY GROWTH %
In the past 18 months, Geelong had three quarters with double-digit house price growth, and during most of last year clearance rates were a good 10 to 20 per cent higher than Melbourne’s, which went through an uncharacteristic auction slump due to credit tightening.
But the market is yet to run away from the average buyer. Growth has slowed to 5 per cent for the March quarter, and clearance rates are down to 50 per cent, just above Melbourne’s.
Auction volumes have halved since this time last year, which threatens to cause a spike in prices. But an increase in days on market shows properties aren’t flying off the shelves.
With the property market unlikely to run away from middle-income earners and first-home buyers, trains have become the focal point of Geelong’s population anxiety.
As a consequence of the rapid growth, what should be a pleasant commute into the city on the train is instead nicknamed the “sardine express” by many.
“It’s running at 140 per cent [capacity]. It’s the busiest rail line in Australia,” Greater Geelong mayor Bruce Harwood said. “Do yourself a favour, just catch it one day. Catch a peak-hour train.
“It’s standing room only by Geelong, just about. You get just out of Geelong, and it’s busy.
“You get to Tarneit and it’s chockablock. You get into Wyndham Vale, you’re pressed in shoulder to shoulder.
“That’s every day,” he concluded, exasperated.
The Geelong Regional Alliance’s chief executive Elaine Carbines says of the 21,000 people that commute from Geelong into the big city, one-third of them get the train. So the Geelong line’s lack of space is a pretty hot-button issue in town.
Geelong CBD office worker Simone Grace said the packed trains were a major concern for her as a new mother, and her elderly mother. “She complains that she never gets a seat,” she said. “We certainly need a lot more infrastructure. It is developing a lot. Our public transport is a real issue.”
Student Connor Ahpene shares her concern. “I’d definitely say [Geelong’s] getting busier. Hopefully they do improve the speed of the trains.”
As well as adding hundreds of new residents, the arrival of several government agencies and bodies has seen a change in demographics across the city.
National Hotel publican James Ramia said it was a great boost for the city following the decimation of Ford, Alcoa and Shell, and changed the type of guests he thought he’d be catering to when re-opening the pub in 2015.
“It’s changed … the majority of the clientele we get now is definitely your office workers,” he said. “There’s a huge public sector presence … so there’s a lot of white-collar workers around town now.”
The comparatively colossal government buildings now dominate the landscape, a symbol of the change foisted upon the unprepared city.
Kaye Rees and husband Greg moved there recently because of his job with one of the departments.
Ms Rees still works in Melbourne and the pair have trialled living in both cities. But escaping the Melbourne crowds was more attractive in the end.
“Even little things like taking a dog for a haircut [in Melbourne], I have to book in six weeks in advance,” Ms Rees said. “Anything you need to get done in Geelong there’s a two-week wait – at best. We were a bit tired of all the traffic and not being able to do things so easily.
“If you want to do something you can actually do it in Geelong, and it’s not far.”
Average days on market for Geelong houses
But recent arrivals and long-time locals fear a lack of infrastructure spending and improvement will rob them of the quiet and easy lifestyle they now enjoy.
Cr Harwood has lobbied hard for more frequent train services on the Geelong line, a line duplication and of course the big-ticket $4 billion newly budgeted fast rail – announced in the recent federal budget but panned by the state government, which said the project could cost three times as much.
The mayor sees the improvements as a necessary step, along with further infrastructure investment, to save the city from suffering Melbourne’s fate.
“It’s not do-or-die but if we don’t do it now we’re playing catch up. It’s going to be ugly,” Cr Harwood warned.
“If we don’t move our population … we’ll be clogged. It’ll be hard to visit your family and friends, it will be hard to take your kids to school or sport or get down to the beach, it’ll be worse and worse.
“Population growth can’t be slowed. We’re at 2.8 per cent and soon it’ll be 3 per cent. It’s not sustainable.”
Geelong clearance rates
If it’s done right, McGrath Geelong principal David Cortous said, the property market would surge. A fast-rail link that takes just over 30 minutes would revolutionise the city.
“I think it’s what Geelong needs, to be connected to Melbourne with something like that,” he said. “I think you’ll find the gap between Melbourne and Geelong real estate prices will close.”
Ms Carbines said the growth would be welcomed by the locals, but they wanted to be heard by state and federal governments.
“The key issue with people in this region is planning for growth. People here are happy for growth but if it’s planned for,” she said. “We already have outpaced our infrastructure. Over the past two to three years it’s been a population boom here so now we have an infrastructure deficit.”
This article was first published in www.domain.com.au. Here is the link to the original article.
Sydneysiders Nigel and Lisa Baldwin and their seven kids moved to a $1 rental in the town of Cumnock. Picture: Kacie Herd
Farmers are offering families homes to rent for as little as $1 a week to help keep their towns alive — all that is required in return is for the children to enrol in local schools.
With the drought spurring an exodus of residents from rural NSW, schools are struggling to attract enough students and funding to remain open.
By offering spare houses on their properties at reduced rents, the farmers hope to boost student numbers, avoiding the need to send their own children to schools in more populated areas more than 100km away.
Other farmers are counting on new families to fill critical skill shortages in their region and help rejuvenate the local community.
Many of the houses, up to five bedrooms, are on substantial blocks near the outback towns of Orange, Wellington and Parkes, more than 350km west of Sydney.
Baldry farmhouse in the Orange area was available for $1 rent.
One advertisement for a $1 farmhouse in Wellington specifies the preferred tenant would have “building” experience.
Another $1 listing in Cumnock, 60km west of Orange, states preferred applicants should be willing to volunteer for squash and tennis competitions and junior athletics and swim programs.
Rentafarmhouse.com.au founder Christine Weston, who sits on the Board of Regional Development Australia, said the prolonged drought was bleeding rural communities of vital workers.
This three-bedroom farmhouse located 30km west of Cumnock is available for $1 a week.
The exodus has opened up a raft of houses available for rent at virtually nothing.
“We now have heaps of empty houses,” Ms Weston said. “We need people to come back and there is an opportunity for families who live in the outer suburbs of big cities to come here and create a new life.
“Many of the homes need some TLC but would suit someone running an online business or working a job from home.”
Rural communities are in particular need of tradies, along with nurses and doctors who might want to avoid the “mortgage trap” of living in an expensive Sydney suburb, Ms Weston said.
This five-bedroom farmhouse in Cumnock is available for $1 per week.
The low rental offers have proved enticing enough to attract some Sydney families.
Nigel and Lisa Baldwin recently moved out of their home in McGraths Hill in northwest Sydney to a $1 rental in Cumnock.
Mr Baldwin had been working two jobs to help support the couple’s seven children and said the dramatically reduced living costs allowed the family to take a step back.
He now uses the rental income from their old McGraths Hill home to fund their lifestyle and they recently bought a pub in their local town.Tips to keep ahead of the property market
“The move was totally worth it,” Mr Baldwin said. “We were living in a three-bedroom house in a densely populated area. Out here we get so much more space and we love the community.”
Mr Baldwin added that having prior renovation experience helped.
“We got the home for basically nothing but there were a lot of things we needed to fix up … but for us that was part of the experience. We wanted an adventure.”
This article was first published in www.realestate.com.au. Here is the link to the original article.
From glitzy high-rises in the city to modest weekenders in the Yarra Valley, the Yarra River wields an extensive influence over Melbourne’s architecture.
The latest project to fall under its spell is in the affluent streets of Toorak, where architects have incorporated curves and textures to imitate the city’s famous river.
Edition, on Lansell Road, is a boutique complex of just three apartments. Architect Dom Cerantonio, managing principal at Cera Stribley Architects, says the flow of the river lends itself to gentle curves that shape the design, particularly the interiors.
“We took cues from the site’s proximity to the Yarra River and the bending of the river and we drew that out as an idea in the early stages of the design,” he says.
“The flow of the river was the concept behind introducing curves into the plan.”
The river’s rock embankments are reflected in the texture of the slimline bricks in the facade. Showing a grey hues in one light and a hint of cream in another, these bricks have also been chosen to evoke the “security and strength which is quite often what you see throughout Toorak”, says Cerantonio.
Each of apartments at Edition not only has a spacious floor plan, but a distinct design and character. The Sky Residences at the very top occupy the third and fourth floors of the building views that stretch out to the city.
The main bedroom opens to a private balcony and features a classic fireplace surrounded by timber veneer wall panels and bronze shelves. The luxe feel extends to the walk-in wardrobe, which is the size of yet another bedroom, and the en suite which is fitted out with travertine, fluted glass and marble.
The Botanic apartment is found on the lower ground and cleverly makes the most of the five-metre site fall by incorporating a double-height, 6.5-metre void around a spiral staircase. The full-height glass wall looks onto a courtyard.
The Arc apartment, located between the other two apartments, is a single-floor apartment that also enjoys a courtyard aspect.
In a series of ticks for downsizers, Edition is located in the heart of Toorak. To the north lies the Yarra, while shops, cafes and restaurants can be found to the south.
The village type feel of Toorak has made the area attractive for downsizers, says James Xeu, owner of quirkily-named cafe The Dihnersaw and his Fionsay on Toorak Road.
“Probably 30 to 40 per cent of our customers are retirees,” he says.
“The rest are mums and kids, teachers from the local schools and office workers.”
There is a Sydney suburb ideal for families who love being on and in the water and it has just become more affordable with a lot of houses to choose from.
Bayview on the northern beaches is home to many large family houses on big blocks and it has a strong emphasis on healthy outdoor living.
The quiet suburb is about 45 minutes north of the Sydney CBD. There is a large waterside park, an active tennis club, a couple of boat ramps to get your boat onto Pittwater, a dinghy storage rack for locals to park their small craft.
And now the Northern Beaches Council is looking to upgrade the Bayview swimming baths beside the Bayview Wharf and marina.Starting your hunt for a dream home
Last year, the council carried out water testing with the view of refurbishing the Pittwater baths.
The independent school, St Luke’s Grammar, has a junior school campus in Bayview and the suburb is also known for its large golf club.
According to CoreLogic there are 20 houses for sale in Bayview at the moment and the median price has dipped more than 11 per cent over the last 12 months to a level below $2 million.
Based on the last 53 house sales in Bayview the new median price is $1,952,500 which is excellent buying for the northern beaches which has a median house price of $1.75 million.
Having said that, over the past five years this prestige suburb has seen its median house price grow by more than 60 per cent.
Many Bayview homes have great views, like this one, from 14 Sunnyridge Pl.
The pool at 14 Sunnyridge Pl, Bayview.
An example of the excellent value on offer at the moment is 14 Sunnyridge Pl, which sold the day before its scheduled auction.
It had been on the market with an auction guide of $2.75 million.
Sasha de Bilde, of Stone Real Estate, said there was plenty of interest in the five-bedroom house, which had a commanding position, magical views and a heated pool.
“It embodies the ultimate in northern beaches living,” he said.
He said he could not reveal the sale price, but confirmed it had sold for “around the guide”.
Street appeal — 14 Sunnyridge Pl, Bayview.
Open plan living.
Almost 50 groups inspected the property during the campaign, with prospective buyers coming from all over the greater Sydney area, Mr de Bilde said.
“There is definitely value in the market and buyers are recognising that,” he said.
The architect-designed property has open-plan living with several areas for entertaining, a gourmet kitchen with island benchtop and a guest suite with stylish bathroom, private balcony and separate access.
Extras include reverse-cycle airconditioning, solar heating, an irrigation system and integrated sound.
Other houses for sale in Bayview include 14 Kookaburra Cl, a five-bedroom house with a price guide of $1.49 million to $1.52 million, a four-bedroom house at 87 Annam Rd with an asking price of $1,525,000 to $1,585,000, a four-bedroom house at 70A Cabbage Tree Rd, with a guide of $1,750,000 to $1,900,000, and a three-bedroom house at 1851 Pittwater Rd with the price tag of $1.55 million.
These properties offer some good opportunities in a suburb that had a median house price of $2.2 million two years ago.
Capital city rents may be in the doldrums, but their regional counterparts across the eastern seaboard are going gangbusters.
Almost every regional area in NSW, Victoria and Queensland recorded rental increases in the past year despite their respective capital cities remaining flat.
Affordability, tree-changers and government investment were the main drivers for the uptick in rents in different regional areas, according to Domain’s senior research analyst Dr Nicola Powell.
She said regional towns within commuting distance of Sydney and Melbourne remained popular, such as Wollongong and Geelong, but more far-flung towns were proving attractive too.
“Your Oranges have been on the radar of people leaving Sydney,” Dr Nicola said. “It’s big enough to offer the job opportunities but small enough to provide the lifestyles that families are after.”
But government and private investment in particular towns were also attracting more people to regional areas and putting pressure on rents, said Dr Powell.
The few towns that recorded declines or remained flat were in sync with their respective capital city, said Dr Powell, yet still recorded a strong rental increase over five years.
New South Wales
Byron’s unit rents recorded a whopping 20.9 per cent increase in the past year, reaching a weekly median of $550.
It’s neighbouring region Richmond Valley also recorded a windfall gain of 14.3 per cent for unit rents in the same period, albeit at a lower price of $300.
The principal of LJ Hooker Evans Head Diane O’Farrell said they rarely have enough rental supply to meet demand from a wide range of tenants, including road workers to families relocating for a sea change.
“We’ve only got three rental properties available. We’re always a bit short on properties,” Ms O’Farrell said.
She said the area was attractive because it was landlocked, but that also had its downsides.
“There are quite a few units because we’ve been short on land for years. We’re landlocked, which is appealing to people. We’ll always be a village.”
On the south coast, house rents in the Shoalhaven area rose by 13.3 per cent in the past year, reaching $470.
Houses rents remained flat in Wollongong, year-on-year, but increased 19 per cent to $500 over five years.
Ray White Wollongong property manager Karen Egan said rental demand in the city and northern suburbs was driven by university students and Sydneysiders, respectively.
“All our four or five bedroom houses are turning into share accommodation. It’s cheaper for them to go into share housing than to be accommodated by the uni,” Ms Egan said.
Every region in Victoria recorded a rental increase in the past year with three standing out from the rest.
Unit rents in Mildura and the Wellington area rose 10 per cent reaching a median of $220.
Meanwhile, house rents in Ballarat also increased 10 per cent to $330, leaving the vacancy rate at its lowest since 2002 according to Kate Brennan, a leasing consultant at Ray White Ballarat.
“People are moving from Melbourne and Queensland. We’re really struggling to keep up with the demand with the little supply we have,” Ms Brennan said. “At the moment, I’ve got over 1000 inquiries in a month, and we have anywhere between five and 25 people going through [each property].”
She said while it’s great for landlords, local tenants are struggling to keep up with prices.
“[For] people moving from the city, their rent is cut in half. You can virtually get a house for half the price with a huge backyard,” Ms Brennan said.
Ballarat’s multiple wind farm projects were also blowing workers into town and adding to rental demand, Ms Brennan said.
Dr Powell said investors were also beginning to look at those migration patterns to capitalise on the prospect of capital growth and yield.
“You’ll find the gross yield is much higher in these regional areas … roughly the yield is about 5-6 per cent. There will be a cohort of investors looking for different opportunities in this changed market,” Dr Powell said.
The Sunshine State recorded huge rental increases with some regional areas making up ground after dramatically falling off at the end of the mining boom.
Gladstone unit rents rose by 23.4 per cent in the past year to $197.50 but down 41.9 per cent over five years.
Similarly, Mackay units sit at $270 per week, a 17.4 increase but down 10 per cent over five years.
In the past year, Townsville also recorded a modest rental increase of 6.3 per cent for houses and 7.2 per cent for units.
Business development manager at Harcourts Kingsberry Townsville Scott Walduck said that was mostly due to the recent floods.
“We started increasing rents towards the end of last year, and that hasn’t happened for a long time,” Mr Walduck said.
He said a lot of rentals that were coming up for lease at the end of last year were wiped off the books.
“A lot of properties that were coming up for rent didn’t because if the owners lost their residence, they’d go into it themselves,” he said.
“Landlords moved families and friends in rather than put it on the books with us.”
Mr Walduck said landlords also exploited the shortage of rentals in the aftermath of the floods, demanding double the property’s appraisal amount.
“We went from having 96 properties before the floods to 19 properties, and people thought they could do that,” Mr Walduck said.
He believed rental supply would slowly trickle back onto the market in the next six to 12 months.
This article was first published in www.domain.com.au. Here is the link to the original article.
Investors are now back in the market, looking for good buys before the proposed changes to negative gearing and capital gains tax come in from January 1 if Labor wins the next federal election.
What type of home in Sydney is likely to bring the best returns? And where? And when?
Now is a good time to snap up an investment property, suggests Domain economist Trent Wiltshire.
“Prices may fall a little more but then the market will bottom out in late 2019,” he says. “The lending environment is easing a bit so banks are offering better deals.
“Consumer surveys also show people are thinking now is a good time to buy, with signs the market is turning around.”
Sydney’s popular blue-chip investment areas – the eastern beaches like Coogee and Bondi, the lower north shore with Neutral Bay and Kirribilli, and the inner west including Annandale and Balmain – can be the best bet, believes Chris Gray, chief executive of Your Empire.
“For the best capital growth and rental returns, you need to stay within five to 15 kilometres of the centre, in areas that are short of supply but always high in demand,” he says.
“Also, try to buy a property that’s priced around the median as the majority of renters, and later buyers, can afford that.
“For apartments, choose a two-bedroom apartment with parking and nice-sized rooms, and if you want to buy a house, you’ll have to spend more money to buy in those blue-chip areas.”
New developments can also be a good buy now, with finance tight for developers and many offering discounts, says Loanmarket East director Alex Lambros.
“Rental returns will be stronger [near the CBD],” he says. “Choose something close to transport and in smaller buildings of 50 units or less.”
On the lower north shore, Olivia Chung of McGrath Neutral Bay favours older-style apartments or houses for investment: “Choose a two-bedroom apartment with parking and a balcony as demand will be higher and they offer the highest yield and capital growth.”
“Choose [a house] that’s already renovated as they can offer a better return straightaway,” she says.
“I’ve already rented 16 apartments in that building and they [are] all getting a good rent of about $1000. And since this is a penthouse, it will get even more because of its size, its outlook and its amazing balcony.”
Only 750 metres to the beach, the penthouse has a large terrace, leafy views, open-plan living and a gas kitchen with stone benches.
This is a classic two-bedroom terrace and a great investment opportunity in a leafy street in a very desirable area of the inner west.
It has character features like period fireplaces, ornate ceilings and timber floorboards, but its kitchen and bathroom have both undergone a good quality renovation and the courtyard has entertaining space as well as rear car access.
This four-bedroom freestanding house is on 363sqm of land, and offers plenty of opportunity to renovate for instant leasing, and then more extensive work later, including permission for a two-storey home, to add extra capital value.
It’s in a corner position in a popular spot just minutes to Maroubra Junction shopping precinct, with a variety of stores, cafes and restaurants, and transport.
Pymble is undergoing a building boom, with property owners either knocking down old 1960s bungalows to make way for bigger new homes, or undertaking major renovations, in order to stay in the area with their perfect home.
“People love it here for the large blocks, leafy streets and great schools,” says Michael Doran of Belle Property Pymble, who’s been selling homes in the area for nine years. “And while we have a lot of established properties, there’s a lot of building going on so people can stay in the suburb but have homes that really suit their needs.”
The steady demand in the upper north shore suburb, 16 kilometres from the Sydney CBD, means the fall in prices has been much less over the past year than in other areas.
Pymble house prices, while up 60.4 per cent over the past five years, have softened by just 0.4 per cent in the last year. That contrasts with much bigger falls in neighbouring suburbs of Gordon of 14.4 per cent, West Pymble at 9.3 per cent and St Ives of 7.3 per cent.
“That doesn’t surprise me at all,” says local businessman Jeoff Jones, who runs Anjeos Hair & Beauty from a site on the Pacific Highway that’s been operating as a hairdressing salon since 1954. “This area has so much going for it, people don’t move away, but a lot of others want to come here.
“We’ve had some of the same customers for 14 years. No one likes to leave!”
He puts it down to the great public transport offered by the train station and buses in the area, as well as the parks and good schools, particularly independent schools like Pymble Ladies College, Ravenswood School for Girls, and Knox Grammar nearby.
It’s certainly still a well-to-do suburb, with median weekly house rents at $1000 for the 16 per cent of people who rent in the suburb, showing a 2.5 per cent rental yield. As well as the building boom in houses, there are also a few new apartment buildings going up over the past few years.
There are a number of good new cafes, restaurants and businesses, including the French cafe Comme Chez Nous and chic furniture store Remarkable Outdoor Living.
“Pymble in the 1950s and 1960s used to be the boutique spot, and was to the upper north shore what Double Bay is to Sydney,” says Jones.
“Now it feels like we’re going back to those days, with lots of building and a fresh vibe.”
Pymble has a clearance rate of 52.2 per cent, a median house price of $2,378,500, and a median unit price of $870,000.
This multi-level home has had a series of quality renovations, so it’s ready to be moved into and enjoyed, with its large open spaces, formal lounge with fireplace, and great outdoor area complete with saltwater pool.
This 1904 Hamilton Park mansion was once owned by the family who started the first shops in Pymble, the Hamiltons. It has been renovated for contemporary living on 3200 square metres of landscaped grounds.
Luschwitz Real Estate lead an expressions of Interest campaign, and advise on a $4.5 million-to-$5 million buyers guide.
Renting a house in Melbourne is now cheaper than it is in Hobart, due to a runaway property market on the Apple Isle and an unusually strong unit rental market in Melbourne.
Domain senior research analyst Nicola Powell said Hobart’s strong rental price was extraordinary.
“Overall for the city it’s cheaper to rent a house in Melbourne than it is in Hobart and that’s never happened before,” Dr Powell said. “Rental competition in Hobart is extremely tight and affordability is being pushed further and further to its limits.”
Domain data show house rents in Melbourne were flat for the quarter at $440 per week; in Hobart the median rose from $420 to $450 in three months, a 7.1 per cent rise.
Median house rents
Victorian Council of Social Services chief executive Emma King said low wage growth meant the rent hikes would impact low-income earners the hardest.
“When people on low or fixed incomes have to pay more in rent, they must cut back on things like food, heating or medical care,” she said. “That’s terrible.”
The relative weakness in Melbourne house rents could be due to strong unit prices, Dr Powell said.
“In both the sale and rental markets, units are outperforming houses,” she said. “It’s almost a little bit counter-intuitive to what you’d expect given Melbourne has a lot of development and a big supply pipeline. But Melbourne has strong population growth.
“Maybe it illustrates a preference of renting a unit and being closer to the CBD than renting a house.”
Median unit rents
Melbourne Asset Management director Cameron Osbourne said an uptake in apartment living meant inner-city units were rented more quickly.
“It’s probably the fact that they’re still cheaper … and people are starting to value that location. Areas like Richmond and St Kilda, there just aren’t very many places around,” he said.
“Even in the last couple of days we’ve been doing rental increases for places that haven’t had them in the past couple of years.”
“We’re finding the situation for rentals really strong, the demand is really high,” she said. “We’re having seasonal peaks and troughs but we had our biggest month ever in January.”
Median weekly house rents
Melbourne – Inner
Melbourne – Inner East
Melbourne – Inner South
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It was not so competitive that the balance had fully tipped in favour of landlords, however.
“Everything’s price sensitive. Prices are stable-ish,” Ms Perrignon said. “We’re not getting outrageous pricing, it keeps growing but it’s not rocketing away.”
ANZ head of Australian economics David Plank said he’d seen both data and had anecdotal evidence to suggest the Melbourne rental market was still difficult to navigate for tenants.
“The data does suggest Melbourne vacancy rates are falling and I’ve had a recent experience with a new member of my team trying to find somewhere to rent in Melbourne experiencing rental bidding at open homes,” he said. “That would suggest that there’s tightness and upward pressure on rents.”
Since December, the vacancy rate has been trending downward from 2.2 per cent to 1.4 per cent in March, Domain data shows.
Median weekly unit rents
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Mr Plank said strong population growth would be one of the core drivers in buoying the Melbourne rental market.
“I think Melbourne’s migration rate has been strong which has helped to absorb the stock,” he said.