Newcastle Property Market Update August 2019

Newcastle was a surprise inclusion in the Lonely Planet’s Top Cities in 2011, mentioned alongside the likes of New York, Valencia and Chang Mai. Lonely Planet questioned back then whether Newcastle was Australia’s most underrated city. It may have been surprising news way back in 2011, but to us local Novocastrians it was something we already knew and Newcastle’s reputation as a great place to live has been constantly growing ever since.

It’s no wonder our area is popular with a wide range of buyers from those looking for their first home right up to prestige buyers seeking their very own glorious beach side home. But just what are these different buyers looking for in a property? We take a quick look at three buyer demographics in our area – first home buyer, upgrader buyer and prestige buyer.

First home buyers are entering the property market for the first time. In this buyer group, we’ve identified the two main points they look for in a property: location and affordability.

As we know, the closer you get to the CBD the more expensive property becomes. For young professionals, the step into the property may be in the form of unit living as a great way of getting their foot in the property door so to speak. With plenty happening within Newcastle unit wise, there are many options to choose from. Softening market conditions combined with recent interest rate cuts mean that units are somewhat more affordable in Newcastle than in recent years. When deciding which unit complex will best suit, it can be a mix of price, location, view, car parking (on and off street) as well as the quality of unit finishes. A word of warning to all – care needs to be taken here and buyers need to do their due diligence before jumping into anything.

A recent sale of a two-bedroom, one-bathroom unit with one car space sold for $575,000 in Cooks Hill. This unit is situated within a smaller complex which is only one street away from the popular shopping and café mecca of Darby Street and still situated close to the CBD for work.

House wise, first home buyers are more than likely looking further afield from the inner-city locations in suburbs such as Gateshead and Cardiff, where more affordable options can be found aplenty. These suburbs are located in close proximity to the major shopping suburbs of Charlestown and Kotara. Gateshead has a median price of $447,500 and Cardiff’s median price is $487,500 (the median price for houses as at April 2019, source: RP Data). One question for the buyer at this price range is whether they are interested in buying properties which require some renovations to modernise the dwelling. This may offer some savings in the initial purchase price and the end result is entirely dependent on the fittings and fixtures of the buyer. This can also offer the chance to grow with the property if the family is extended in the future.

Upgrader home buyers are mostly looking for larger style family homes. These properties are usually the more typical four-bedroom, two-bathroom, two-car spaces and more often in recent years include a media room or upstairs second living area. There’s a preference given to quiet neighbourhoods, close to shops and schooling options. Many family buyers will give greater preference to larger blocks and larger homes than being closer to the CBD. A good example here is Fern Bay just north of Newcastle and also the suburb of Medowie. The median house price for Fern Bay is $642,500 and Medowie has a median house price of $525,000 (as at April 2019, source: RP Data). Both suburbs have new land subdivisions where there’s a choice of buying land and building a brand-new dwelling or buying a recently constructed house. Medowie is a slightly older suburb and has a variety of older style dwellings on larger blocks which also offer the opportunity to renovate.

A recent sale in Fern Bay of a four-bedroom, two-bathroom and two-car space dwelling on a 714 square metre block of land went for $785,000 in July 2019.

Prestige buyers have a much larger budget and are able to look in the $2.5 million-plus market. Newcastle has a few suburbs which are constantly in demand with buyers actively looking for these types of properties. They can be found situated in the suburbs close to beaches and by close we mean within easy walking distance. The houses are more often architecturally designed with the additional four-plus bedrooms and notable extras including high-quality kitchens and bathrooms and additional living areas, not to mention sweeping views of beaches and city skylines which is also a fairly important factor in this price bracket. Some recent sales in Newcastle above the $2.5 million range include properties featuring pools with landscaped areas, outdoor kitchens and integrated living areas and some include lifts.

One such prestige property located in Bar Beach sold in December 2018 for $4.25 million. It has five bedrooms, four bathrooms and two-car garage that spans three levels and is situated within walking distance of parks, Bar Beach and in close proximity to local shopping within The Junction. All three buyer groups have different concepts of what they want within a property, but fundamentally they all have three things in comment – the right location, budget and a love of “Newy”.

Speak with a Newcastle Mortgage Broker today.