John Ahern, InfoTrack’s CEO has just released the latest FY21 property market data and this is what was uncovered.
Regional areas grow in popularity for First Home buyers
Is the Sydney-shine wearing off for First Home Buyers? Newly released May and June data shows that the regional areas of NSW are growing in popularity.
In the Financial Year 2020-2021 (FY21), First Home Buyer activity across all of NSW grew. It reached a height in March 2021 and then reduced slightly coming into April as the initial stage of the First Home Loan Deposit Scheme finished. Consumer confidence also rose, and investors began to come back into the market, creating competition. Overall, First Home Buyers remain positive. This is reflected by higher activity now than this time last year.
Top 10 hottest regional suburbs for First Home Buyers
The hottest regional suburb that First Home Buyers are targeting is Hamlyn Terrace. Hamlyn Terrace is on the Central Coast and the average property has 3 bedrooms with a median price of around $540,000. The Central Coast is an accessible distance to Sydney, so for those who wish to enter the property market and can mix remote work with time in the office, living in this area is a good solution.
The second hottest regional suburb is Wagga Wagga. Far away from Sydney, the median price for a 3-bedroom property and land in this suburb is $435,000. There are two Home Buyers Schemes currently in play that are contributing to this growth in home and land demand.
Popular schemes supporting First Home Buyers
The First Home Loan Deposit Scheme was due to finish in April 2021, (reflecting the small dip in First Home Buyer activity), but another 10,000 places have just been released this financial year for first home buyers to gather a 5% deposit.
The New Home Guarantee also has 10,000 places and is designed to support First Home Buyers to build or buy a new home, with higher property price caps available in selected areas. These caps are far too easily reached in the cities, so first home buyers are looking for options elsewhere, hence the shift to regions.
Forecasting First Home Buyer future hotspots
This time last year, first home buyers in Albury were in the single digits, now we’re seeing almost 3 times as many First Home Buyers making purchases in that postcode. As a border town, Albury could be popular amongst NSW and Victorian residents, especially those looking to escape some of the heavy lockdowns Victoria has gone through in recent times.
Cessnock is far more popular than its immediate surrounding suburbs. First Home Buyer activity in Cessnock has doubled over the last 12 months. Data from the last two months puts it now on par in popularity to suburbs like Kogarah and Kingswood. The average 3-bedder in Cessnock goes for $379,000 and there is currently an abundance of available properties.
Industry opinions on first home buyer activity
Real Estate Influencer
Many first home buyers were happy renting but have now changed direction and want to buy because even with rent drops, interest rates are so low that it’s cheaper to buy than to rent. First home buyers are definitely buying in North-West and South-West of Sydney.
What I’m seeing in relation to first home buyer activity in today’s property market is that it’s at an all-time high, and I assume FOMO is the biggest driver.
There is also a growing trend for first home buyers to purchase houses over units.
Property & Leasing Commercial Lawyer
Partner - Sparke Helmore Lawyers
Over the past 6 months in particular there has seen a significant resurgence in the property market and, whilst the market is starting to plateau slightly, there remains a great deal of talk around stamp duty reforms which themselves could spur a further spike in transactions through the short-term savings they could provide buyers.
Since the start of the COVID-19 shutdowns occurring. …there was talk of significant decreases in market values across the sector, as much as 20-30%, but as we have seen quite the opposite has occurred.
The personal motivation to get into a bigger, better designed home with the now hot to trot home office environment included has been a driver for many young families also gearing off the push for more flexible working arrangements with their bosses.
Sources: The data in this report reflects conveyancing activity of property lawyers and conveyancers in NSW within InfoTrack's platform. Median house prices domain.com.au