Beach towns could once again prove to be a hotspot for investors, with property prices rising in certain coastal areas.
Figures from property research group PRDnationwide show there has been strong growth in some locations – with units appreciating at a faster pace than houses.
PRDnationwide’s head of research Aaron Maskrey said in the past year the best performing coastal town was Bells Beach in Victoria.
“Unit prices performed well, increasing by 24.5 per cent during the year ending December 2011,” he said.
“Similarly, house prices in Bells Beach increased by 5.2 per cent for the period.”
Mr Maskrey said the strongest area for activity has been the Gold Coast with 2,722 unit sales and 2,216 house sales in the second half of 2011.
In addition, there’s been a boost for median prices in Port Douglas – with units up 14.8 per cent to reach $310,000.
“Looking at the main coastal markets across Australia, many of them are set to reach the bottom of their property cycle over the year, making it a good time to invest in coastal property, given the past three years' price falls,” Mr Maskrey said.
While the market is not expected to see double digit growth in the near future, Mr Maskrey said it was still a good time to buy.
“For investors looking to buy for capital gains there are good opportunities out there,” he said.
“It is very location specific, with some markets faring better at the moment than others but coastal property can be a good investment if you buy in the right location.”
“Prices have become very competitive over the years, with vendors selling at a discount to meet the market."
Areas where prices have fallen include Coffs Harbour, in NSW, where the median house price is down 2.6 per cent. Similarly houses in Queensland's Whitsunday Region are down 1.7 per cent for the year.
Byron Bay, in NSW, experienced big decreases in median price for both units and houses, at 25.4 per cent and 19.3 per cent respectively, PRDnationwide found.
The research also revealed that four out of the top five beach town markets to have experienced the largest increase to the median price were for units, not houses.
For instance the research found unit prices in Yamba, NSW, performed well, increasing by 9.1 per cent during the year ending December 2011.