 |
 |
 |
 |
 |
 |
 |
 |
|
Discount Family Houses
Real estate agents love nothing more than the pitter patter of little feet, especially when they force space-starved parents to look for larger houses.
Even lower prices and a volatile property market won’t stop families with children desperate for a bigger backyard or better proximity to schools from buying and selling.
“Ultimately, people who buy and sell in the same market are not really affected by price falls,” says Australian Property Monitors research director Louis Christopher.
And Ray White Chief Operating Officer Peter Matthews says today’s market offers the best “dollar for dollar” opportunity to upgrade to a family house.
“The market adjustment means you are getting more value in your upgrade,” he says.
“So you might have to sell your townhouse for $30,000 less than two years ago, but the $900,000 house you would have upgraded to is now worth around $800,000.”
Christopher says there are potentially good opportunities for buyers in the south, upper north shore and inner west during this “stabilisation period” of the market.
He says the City and East region of Sydney had its first quarterly median house price increase in March after a period of price falls, and he expects small rises on the lower north shore and northern beaches to follow.
“After that, the inner west will pick up and then the outer-lying areas like the upper north and south,” he says.
He says April this year held the all-time record for days on market, with the average house sale taking 95 days compared to May when the average sale took 91 days.
“I’d say the next 12 months will start to see an end to price volatility,” he says.
“That’s not to say we will ever see a return to the boom prices of a few years ago, but I think eventually we will start to see gentle increases in the median house price.”
INNER WEST REGION
Median House Price March 2005: $635,000
Median House Prive March 2004: $690,000
Annual change: -8 per cent
Average price discounting May 2005: 7.6 per cent
Average price discounting May 2004: 5.8 per cent
This is the cheapest region to buy a freestanding house in Sydney within 10 kilometres of the CBD.
McGrath Estate Agents Simon Pilcher says the proximity to the city and the ease of access to the eastern suburbs is the most attractive thing for families looking to buy in the “inner” inner west suburbs of Lilyfield, Annandale and Leichhardt.
“You get a lot of people selling apartments in the beach suburbs like Coogee and coming here to buy their first house,” he says.
Further west, the large blocks of land and prestige schools around Strathfield attract families who happily spend more than $1million to secure a modern house and large block of land.
“If we didn’t have schools here, we wouldn’t have a market,” says Devine Real Estate principal Steven Devine.
“I don’t think Strathfield is much cheaper than it was this time last year, but some of the surrounding suburbs like Concord and Homebush have better value buying – you can get something nice for $700,000 or $800,000.”
Warwick Williams Real Estate Principal Warwick Williams, who sells around Canada Bay and Drummoyne, says semis are the best bargains right now.
“Semis that used to sell for $835,000 are lucky to get $750,000 now, so it’s definitely cheaper for people who want to sell a unit to upgrade to a semi than a house,” he says.
For cheaper family homes on decent-sized blocks of land, Dulwich Hill, Summer Hill and Ashfield offer a range of older-style houses for sale between $500,000 and $700,000.
Mallouhi Property principal Joe Mallouhi had a three-bedroom house in Croydon listed for sale at offers over $550,000 and it just sold to a young couple for $547,500.
UPPER NORTH SHORE
Median House Price March 2005: $629,000
Median House Prive March 2004: $685,000
Annual change: -8.2 per cent
Average price discounting May 2005: 8.4 per cent
Average price discounting May 2004: 6.4 per cent
“The kids who grow up on the upper north shore are like rooks – they do their time on the beaches or the inner west but when they have children they come back to roost,” says Ian Chadwick First National principal Scott Chadwick.
Private schools, leafy streets and large houses on 800 square metre-plus blocks are the big attraction for families who buy on the north shore.
“In the heartland from Roseville to Wahroonga, quality is a big thing and that means houses that aren’t quite up to scratch are being discounted hugely,” Chadwick says.
He says a well-located but unrenovated house in Roseville just sold for $785,000 and it was being rented for $900 a week to a corporate tenant.
“That is good buying – there aren’t that many places in Sydney getting a yield like that,” he says.
St Ives Real Estate principal Chris Schiller says the bushier suburb of St Ives has always been more affordable than “the Pymbles and Killaras”, and entry-level prices have taken a nose dive in the last year.
“St Ives is the typical middle management quarter acre block type of suburb – houses that were selling for $850,000 last year are selling in the $700,000s this year,” he says.
In Cheltenham and Beecroft, older families are upgrading from nearby suburbs to take advantage of the good local high schools and easy access to north shore private schools.
“For lower value properties in the area, the opportunities have never been better – there is plenty of three or four bedroom houses on blocks of 700 sq m or more on the market,” says Raine & Horne Beecroft principal Tony Aylmer.
“We are getting families from Stanmore, Leichhardt and Annandale coming here for the space.”
Century 21 Carroll & Partners agent Cathie Smith says prices usually start in the $700,000s in Cheltenham and Beecroft but get cheaper in the fringe suburbs like Westleigh and Thornleigh.
“You can buy in Westleigh for the $600,000s but even in Cheltenham you can get good prices at the moment,” she says.
“We have a cottage that’s been renovated and it’s just been discounted from $659,000 to $649,000.
“And, of course, there is plenty of opportunity to haggle and get a better price now than there was last year.”
NORTH-WEST
Median House Price March 2005: $550,000
Median House Prive March 2004: $573,000
Annual change: -4 per cent
Average price discounting May 2005: 9 per cent
Average price discounting May 2004: 7.3 per cent
The Hills District is the quintessential family suburb with large modern and older houses on good-sized blocks of land, often close to parks and schools.
Louis Carr Real Estate principal Michael Roberts says the area took a hit last year but only lower-value properties have been affected.
“Anything that’s over a million is still selling as well as it always did,” he says.
“It’s the cheaper properties that investors want to get rid of that are the bargains at the moment.”
Raine & Horne Baulkham Hills principal Trevor Leslie says buyer confidence has been shattered and every property is at least $30,000 or $40,000 cheaper than this time last year.
He says houses in Winston Hills on 600 sq m blocks are selling in the high $400,000s this year compared to prices of more than $500,000 last year.
“The Crestwood area of Baulkham Hills and Castle Hill are the most in-demand suburbs around here,” he says.
“Interestingly, rising fuel prices have made people prepared to pay more for a house in the Hills rather than move to a bigger house out at Penrith – they know that the further out they go, the more their fuel bill will be.”
SOUTH
Median House Price March 2005: $570,000
Median House Prive March 2004: $664,750
Annual change: -14.3 per cent
Average price discounting May 2005: 9.2 per cent
Average price discounting May 2004: 6 per cent
Kim Gilmore Real Estate principal Kim Gilmore has a theory about why the south has taken Sydney’s hardest hit in median prices.
“This area is all about median income people with two or three children, so when bad news hits they react a lot more conservatively than young couples or business professionals,” she says.
John Greig Real Estate sales manager David Greig explains that the south had “enormous growth” during boom time and is now coming back to more reasonable levels.
“There is definitely better buying this year, especially at that entry level,” he says.
He says the family appeal of the Sutherland Shire means older parents are often helping their children buy units and houses in the area.
“Because things got so expensive, a lot of people were giving their kids a hand to buy property so they could stay in the area,” he says.
Greig says Kareela and Sylvania have three and four bedroom 1960s and 1970s era houses on blocks larger than 500 sq m starting in the $500,000 and $600,000 price range.
Further south, L.J. Hooker Engadine principal Ron Di Donato says there is a larger range of houses available in the $400,000 price bracket, especially around Engadine.
“Last year, anything that was $450,000 was gone a week later but now there are 10 or 12 to choose from,” he says.
“Young couples buy them because it’s just about the cheapest thing you can buy in Sydney which is on large land.”
Denise Howell Real Estate principal Denise Howell says the premium Sutherland Shire family homes priced between $900,000 and $1.3 million are the most in demand, especially from older families wanting to downsize and move closer to the water.
“We have a shortage of the very good stock, but the lower-priced houses are being discounted,” she says.
“In Caringbah South, which is a very good bayside suburb, you can get an unrenovated house in the $600,000s now – last year it was at least $700,000.”
CASE STUDY
Squeezing two children in to a small Paddington terrace house just does not work, according to Lucy Walker.
“Everything in a terrace is too close – the neighbours are too close, the roads are too close. The only thing that isn’t close is the parking on the street,” she says.
Lucy and Peter Stepto, parents of two-year-old Jessame and six-month-old Toby, have just bought a larger family house, a three-bedroom cottage on 385 sq m in Lilyfield through McGrath Estate Agents for $692,000.
“We were desperately looking for something that had a backyard, somewhere the children could stretch their legs,” Lucy says.
The couple had been looking to buy a family home for months and found prices were becoming more attractive.
“Nothing is cheap but the inner west definitely has good value buying now,” she says.
“We couldn’t afford anything bigger in Paddington and nothing in the east had a garden that was bigger than a square patch of grass – well, nothing in our price range anyway.”
Lucy is looking forward to moving to Lilyfield, where she hopes the sense of community is better than in the east.
“In Paddington, most of the old people have moved out and there are lots of people with high disposable incomes who haven’t had children yet – there just isn’t that same sense of community as when we moved in,” she says.
HOW OTHER REGIONS PERFORMED
City and East
- Median house price March 2005 $890,000
- Median house price March 2004 $975,000
- Annual change -8.7 per cent
- Average price discounting May 2005 8.2 per cent
- Average price discounting May 2004 7.3 per cent
Lower North Shore
- Median house price March 2005 $1,015,000
- Median house price March 2004 $1,042,000
- Annual change -2.6 per cent
- Average price discounting May 2005 9 per cent
- Average price discounting May 2004 8.9 per cent
Northern Beaches
- Median house price March 2005 $840,000
- Median house price March 2004 $920,000
- Annual change -8.7 per cent
- Average price discounting May 2005 6.9 per cent
- Average price discounting May 2004 6.4 per cent
Canterbury-Bankstown
- Median house price March 2005 $450,000
- Median house price March 2004 $490,000
- Annual change -8.2 per cent
- Average price discounting May 2005 9 per cent
- Average price discounting May 2004 7.3 per cent