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Sydney has lost its mantle as having Australia’s most expensive median house price to a location that is home to just 34,000 people, according to a property market research firm.
New research from Propertyology has found that Australia’s most expensive city is Byron Bay in northern New South Wales, with a population of just 34,500 people and a median house price (as at December 2018) of $987,500.
Propertyology head of research Simon Pressley said the city’s price has accelerated in the last few years.
“Byron’s median house price increased by a whopping 64 per cent over the past five calendar years, propelling it to the top of the national table.
“Sydney and Melbourne both produced a 44 per cent increase over the same five years to be $950,000 and $772,500, respectively.”
Mr Pressley said the price gap between Australia’s two largest cities and its most expensive one was likely to widen further, given house prices in Byron Bay continue to rise while in Sydney and Melbourne they continue to fall.
He said that Melbourne wasn’t in the top five for expensive major regions by median house price.
“Ahead of Melbourne are three other major regional locations: Kiama and Wingecarribee, both in New South Wales, as well as Victoria’s Surf Coast,” Mr Pressley said.
Mr Pressley said that Byron’s median house price has increased by an average of 10.1 per cent over the past 20 years — the highest rate of growth of any Australian city.
“It’s staggering that Byron has averaged double-digit growth every single year for two decades. I doubt whether there’s another city anywhere in the world that has done that,” he said.
Small packages
Mr Pressley said that, back in 1998, the median house price in Byron Bay was just $140,000, adding that Byron’s number one position showed that size didn’t matter when it came to capital growth.
“Byron’s average annual population growth rate of 0.9 [of a percentage point] is well below the 17-year national average of 1.5 per cent,” he said.
“Byron’s status is the ultimate proof that the size of a city’s total population or the annual rate of population growth are not the biggest drivers of property prices because, as I always say, there are a large number of factors which influence property markets.
“In Byron’s case, housing demand is primarily driven by the affluent, middle-aged, Australian-born couple. Census data shows Byron’s median household age is 44 — compared to the national average of 38 — and there’s a below-average number of children per household as well.”
Mr Pressley said that, despite its high house price, a higher percentage of households in Byron own their dwelling outright than the national average, 36 per cent against 31 per cent.
Its desirable location in northern New South Wales also means that strong buyer demand pushes up prices, especially in recent years, given many of its new residents reside in Byron while running businesses from their coffee tables or commuting to other capital cities, he said.
“Byron is only a two-hour drive up the highway to Brisbane or a one-hour flight to Sydney via Ballina, plus the Gold Coast international airport is also only an hour away,” Mr Pressley said.
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