Conventional wisdom says house prices double , but in a string of sea- and tree-change hotspots prices have jumped that far in five or less.
The combination of COVID lockdowns, remote working, ultra-low interest rates and cash saved from cancelled overseas holidays has supercharged price growth in holiday towns, some of which have become permanent destinations.
House prices are at least 120 per cent higher than five years ago in Victoria’s Alpine shire and the NSW Snowy Monaro Regional Council area, Domain data shows, as keen skiers who could not travel overseas purchased winter holiday homes. Prices rose a similar amount in the Glamorgan-Spring Bay council area in Tasmania’s east.
Sea-change stunners Noosa and the Byron shire rose 106. 3 per cent and 111. 8 per cent respectively from five years ago, as buyers chased getaways or a long-term move.
While the trend for city dwellers to make a regional move for a more relaxed lifestyle was already underway, the widespread shift to remote working two years ago only accelerated it.
Melbourne recorded a reduction of 60,505 residents in the year to June 2021, before the last of its six lockdowns were over, while Sydney had a smaller drop of 5151.
The pressure on dwelling prices and rents is making it harder for some locals to compete with the deeper pockets of buyers coming from the city.
On the flipside, agents say some sellers are taking the opportunity to cash in on the boom.
First National Byron sales manager Tara Torkkola said the biggest price growth had been in pockets that were traditionally less expensive than their neighbours, and had caught up since COVID hit.
Two years ago, people were craving space, fresh air, privacy, the chance to grow their own food and multi-generational accommodation options, pushing up prices in the Byron hinterland and for acreage properties, Torkkola said.
[People said] ‘My parents are going to move up, because we don’t want to be apart from the kids’, she said. Multi-generational living has become really prominent.
She highlighted Mullumbimby, Suffolk Park and Ocean Shores as areas that have shone, but said the strong growth was unlikely to continue at the same pace.
A lot of sellers are in a fortunate position that, even in a plateauing market, people’s heads are spinning as to how much it has reached.
Tom Offermann, of the eponymous Noosa real estate agency, has been fielding strong demand from buyers from Brisbane, Sydney and Melbourne looking for somewhere to relax and recuperate.
Melbourne clients have long been great fans of Noosa and have owned properties here, he said.
They have had clearly increased competition from people that live in Sydney. People in Sydney are becoming more mobile and some of them are going beyond their own beaches.
Planning restrictions that limit new development in Noosa means the area is tightly held, and late last spring Offermann would often see 10 or more potential buyers at an auction, a number that has dropped to a still-competitive three to six in recent weeks.
But he said suggestions that the market has peaked could be premature, and continued wealth generation could support prestige Noosa real estate for another two to three years.
In cooler climes, house prices in the ski fields of both Victoria and New South Wales have jumped.
Zirky Real Estate’s Rob Ford, who specialises in alpine homes in Mount Hotham and Dinner Plain, four to five hours northeast of Melbourne, has seen the market double in price even in the last two years.
He said wealthy skiers aged in their 50s and 60s, who normally ski overseas, have instead been buying winter holiday homes while international travel has been off-limits or at least questionable.
It has been interesting – when COVID first came along I was expecting to have the opposite effect on our market, he said.
We’d normally only sell one or two properties over $1 million before COVID. I have sold over six in the last six months between $1 million and $2 million.
Even at the more affordable end of the market, some one-bedroom apartments that used to fetch $110,000 to $140,000 are now trading for $220,000 to $270,000, he said.
He expects the market to flatten out, but added buyers who own main residences that have increased in price have been able to use their home equity to buy second homes.
Prices are less likely to have doubled in such a short time-frame within the capital cities.
By suburb, only a handful of capital city neighbourhoods have prices double their level of five years ago, such as Moncrieff in Canberra, up 124. 8 per cent, Palm Beach on Sydney’s northern beaches, up 128. 3 per cent, Teneriffe in Brisbane, up 128. 4 per cent, and Copacabana on the NSW Central Coast, up 132. 7 per cent.
Even the idea that property prices double every 10 years has proved variable.
Separate from Ray White showed prices have at least doubled in the last decade in Sydney, Hobart and Canberra, and increased by 90. 2 per cent in Melbourne. But growth was well below that level for Brisbane (57. 4 per cent), Adelaide (50 per cent) and resources-affected Perth (13. 1 per cent).