Port Stephens leads the pack in dwelling value growth

New analysis of Australia's regional coastal towns by CoreLogic revealed homeowners in three suburbs of Port Stephens experienced the biggest price gains across the state from March 2020, up more than 60 per cent.

Port Stephens holiday hotspot Shoal Bay topped the list, up 70.9 per cent in the four-year period, followed by the beachside suburbs of Hawks Nest (up 67.7 per cent) and Fingal Bay (up 64.5 per cent).

The median dwelling value in Shoal Bay is $868,748.

Hawks Nest holds a median dwelling value of $859,252 while the median in Fingal Bay is $1,053,051.

The study analysed dwellings (units and houses) in 368 coastal markets across Australia, at least 50km from the nearest capital city CBD.

CoreLogic research director Tim Lawless said most of the growth was recorded between late 2020 and early 2022.

"Many of these areas have seen values rise from a relatively low base, with dwelling values generally around the $500,000 to $600,000 mark at the onset of the pandemic," Mr Lawless said.

"With regional migration booming through the worst of the pandemic and housing supply holding extremely tight, it's not surprising to see these relatively affordable markets within three hours drive of the Sydney CBD surge in price."

Although most of these areas saw prices rise during 2023, Mr Lawless said the pace of gains was nowhere near the highs seen through 2020 and 2021.

"For example, Shoal Bay saw dwelling values surge 48 per cent in the 2021 calendar year compared with a 5.2 per cent rise in 2023," he said.

Sea changers bring in the big bucks

PRD Port Stephens selling agent Dane Queenan agreed there had been an adjustment in the market over the past year.

"Although there was that growth in the market, over the last six to 12 months there has been a good 10 to 15 per cent adjustment off those highs," Mr Queenan said.

He said prices in Port Stephens surged with the arrival of out-of-area buyers seeking a permanent sea change or holiday house in the region.

He set a record for the sale of a house in Fingal Bay in June last year after a buyer from Sydney splashed $3.9 million on a beachfront property with the intention of demolishing it to build a holiday home.

"Since COVID a lot of people from Sydney have bought holiday homes in the area, in particular in Shoal Bay," he said.

"A lot of our sales are holiday makers and the Shoal Bay Country Club has a huge amount to do with that in regards to attracting people into Port Stephens.

"That has been massive for our area and has brought a lot of people into Shoal Bay."

He anticipated the Port Stephens region would experience further growth with the $110 million Newcastle Airport International Terminal at Williamtown due for completion this year.

Sellers in the winning seat

Recent sales in the suburbs show the huge gains for sellers, with a three-bedroom home at 95 Rocky Point Road in Fingal Bay selling for $1.23 million in October 2023 after previously exchanging for $800,000 in February 2021.

In Hawks Nest, a three-bedroom house at 21 The Boulevard in Hawks Nest purchased in December 2020 for $1.026 million went on to sell in October last year for $1.7 million.

In Shoal Bay, a three bedroom home 600 metres from the water at 57 Tomaree Road earned the seller a profit of half a million dollars in three years.

After exchanging for $1.008 million in June 2020, the property sold for $1.58 million in November.

Mr Lawless said although the trend was pointing towards further growth in 2024, it would likely be at a lower rate than 2023 given housing affordability challenges and the likelihood that interest rates would remain elevated through most of the year.

"The lower, but positive, rate of growth across Port Stephens over the past 12 months reflects an ongoing imbalance between supply and demand which is keeping upwards pressure on housing prices," he said.

Of the 368 coastal markets analysed by CoreLogic across Australia, Mr Lawless said just over one third (35 per cent) recorded housing values at record highs at the end of last year despite multiple rate rises, cost of living pressures and market uncertainty.

An additional 8.7 per cent of markets recorded a modest fall in value of less than 1 per cent.

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