Buying property on the insular peninsula

By Alex May

It might be known as the insular peninsula, but when it comes to real estate on Sydney’s northern beaches it is buyers from outside the area that are driving up prices.

Cunninghams Real Estate’s John Cunningham says more than half the buyers he deals with are from out of the area – something that was unheard of ten years ago.
“We call them greener pastures buyers and they come from the lower north shore, the inner west and increasingly from the eastern suburbs,” he says. “They might be a couple from a two-bedroom semi in Annandale who have a child or and they want to move here for the big blocks of land, to be close to the beach and for the perceived security and safety.”

Doyle Spillane’s Peter Spillane says the northern beaches was a parochial real estate market – “it was just locals who bought locally” – until about four years ago. “With Sydney’s population growth it was to be expected that people would discover the tremendous value on the northern beaches,” he says.

Macquarie Bank’s Rod Cornish predicts that the northern beaches – the area of Sydney north of Spit Bridge to Palm Beach– will have comparatively strong growth in median house prices over the next 12 months.
“It’s hard to generalise, but I would say the northern beaches will get something in the order of 10 per cent growth over the next 12 months, which will probably be better than other areas in Sydney,” he says. “That’s because of the desire to be near the beach and the quest for lifestyle.”
Cornish says the suburbs closest to the city, such as Balgowlah and Manly Vale, and houses close to the beach will be the best performers.

Most of the housing in the northern beaches is detached on large blocks of land – a traditional suburban offering in an environment near pristine surf beaches, Pittwater and national parks like Ku-ring-gai Chase and Garigal.

Raine & Horne Palm Beach, Whale Beach and Avalon principal Glenn Lee says families can buy a comfortable house in family-friendly suburbs like Bilgola Plateau, Mona Vale and parts of Avalon for as little as $700,000 to $750,000.
“Avalon, Newport and Clareville are the family heartland of the northern end of the northern beaches,” he says. “What’s happening is that people are increasingly restructuring their work so they don’t have to be in the office five days a week and they come here to enjoy the lifestyle with their family.”

Max Walls International’s Anthony Walls says the northern beaches has huge appeal for Australian ex-patriates who are earning US dollars or British pounds and want to buy a house back home.
“These people live like kings and they want to come back to the good Aussie lifestyle and are prepared to pay whatever it takes as long as they are near the beach and have good access to private schools for their kids,” he says. “I sold a unit to an American buyer for $2 million and if I had sold it on the local market, it would have achieved about $1.4 million – these international buyers think $1 million Australian is small change.”

John Cunningham says the clean-up of sewage outfalls at North Head has been the major driver of northern beaches real estate.
“It was only 10 years ago that the sewage was polluting the beaches, but now they are just pristine and Manly Council has done a lot to clean up stormwater,” he says.

He says closeness to the city used to drive real estate prices, but now it is closeness to a beach.
“The most dramatic example of that is Curl Curl, which used to be a working class suburb but now you can’t get anything there for under $1 million,” he says. “People who bought $500,000 houses there five years ago now have houses worth $1.3 million.”
Lee says the northern end of the peninsula is still commanding the best prices, especially in Palm Beach and Whale Beach.
“There is a social and cultural thing that Palm Beach and Whale Beach are the prestige holiday suburbs and they are renowned internationally for being so,” he says.

Summer rentals in Palm Beach command $5000 to $8000 a week, with some select beachfronts getting $30,000 a week while buying a good position in Palm Beach will cost at least $2 million.
“Sydney had overall price growth of 19.2 per cent in the last 12 months, and we certainly haven’t had that same growth around here but that’s because our prices are already higher,” he says. “Anyone who bought on the peninsula in the last three years has had price increases of between 30 and 40 per cent.”

Most properties on the peninsula – which is north of Mona Vale – are within a kilometre of either surf beaches or Pittwater, which is why the northern end of the beaches is more expensive.
The northern beaches are one of the few parts of Sydney without a major freeway or train line, but the long commute doesn’t seem to be putting people off.
“Cars and buses are the major form of transport and the ferry is good for people in Manly,” Cunningham says. “The drive to the city from Curl Curl can take anything from 45 minutes to an hour and fifteen minutes, but people don’t seem to mind as long as they are near the beach.”