The average price of three-bedroom houses in Byron Bay skyrocketed by 70 per cent over the year to mark the biggest gains across all waterfront suburbs in the country as demand for lifestyle properties continues to soar.
Data from PropTech Group has revealed that high-end waterfront properties have seen staggering growth in the last 12 months, indicating the incredible rise in appetite for high-end properties throughout the pandemic.
“The market for waterfront property is soaring as a result of COVID-19. Buyers who might have waited to purchase a waterfront property later in life are just going ahead and doing it,” PropTech Group chief executive Joe Hanna said.
“After the lockdowns, people are willing to spend more on larger homes with lifestyle benefits, such as waterfront views and water access,” Mr Hanna further explained.
The report – which analysed market sales and listing data for properties in suburbs that border a major body of water, the dwelling type and the number of bedrooms – also showed that NSW was home to the top 10 highest waterfront price gains year-on-year.
Byron Bay took the top spot, with the average price of three-bedroom houses in the beachside town rising from $1.5 million to $2.5 million over the year to March.
Larger waterfront apartments were also in high demand, with the median price for a three-bedroom unit in Darling Point jumping by 60.7 per cent year-on-year.
Others in the top 10 for price increases include four-bedroom houses in Vaucluse (47.05 per cent), North Ryde five-bedroom houses (46.66 per cent), South Coogee four-bedroom houses (44 per cent), Freshwater three-bedroom houses (42.85 per cent), Manly four-bedroom houses (41.93 per cent), Maroubra five-bedroom houses (40 per cent), and three-bedroom houses in Newport (39.43 per cent).
Why are waterfront properties popular among Aussies?
Weighing in on why Australians can’t get enough of waterfront real estate, managing director of Christie’s International Real Estate Sydney Ken Jacobs said it’s all about the “Australian psyche”.
“Owning waterfront property is the ultimate property goal of the majority of Australians. It’s more true here than in a lot of other countries,” he said.
He also pointed out why waterfront properties in the country stand out above the rest: “Our climate comes into play and the harbour and coastlines are beautiful. Just look at the population, more than 80 per cent of Australians live within 50 kilometres of the coast.”
Meanwhile, Mr Hanna said that despite the long-term coastal risk from rising sea levels, shoreline erosion and more frequent severe storm events, the demand for waterfront properties is unlikely to cool down anytime soon.
“The recent floods have not put buyers off waterfront property, but they have made buyers more selective,” he said.
“As a result of the floods, buyers are asking questions they seldom asked before. They want to see the council forecasts for 100-year floods and are much more aware that waters could rise.”
Mr Jacobs concurred, stating he is yet to see the floods make buyers wary of waterfront properties.
“[While] people will factor into their buying decision locations that have flooded before, but over the years I haven’t seen events like that change the thinking of waterfront buyers in general,” he said.
However, he advised those looking to get a piece of the sought-after market to focus on fundamentals when buying, noting that “not all waterfront suburbs are created alike”.
“Some suburbs have performed better than others statistically because of supply and demand and what comes on the market,” Mr Jacobs stated.
Looking ahead, the industry expert sees the further tightening of the premium market due to low supply. “I don’t think the price increases will stay on the same trajectory. The issue at the moment is stock. We don’t have enough stock,” he said.
He surmised that rising demand – both local and international – will outstrip the low listings and accelerate price growth. “We have buyers. We have local buyers. We have expats coming back. We have foreigners coming from America, Europe, and Hong Kong wanting to relocate to Australia,” Mr Jacobs stated.