As we wrote in March and September, 2020 has been a great year for the Hunter Valley property market, despite the COVID-19 pandemic.
In fact, we’re very proud that, here at One Agency Lindy Harris, 2020 has proven to be our best year ever for property sales.
We believe the success of the property market in our region this year reflects the broader population and economic growth in the Singleton area. The Hunter’s economy is now underpinned by industries and influences outside of the mining sector, which make it more diverse and resilient than in the past. Singleton is also a great place to live, offering families a great lifestyle and affordable property close to all the amenities of Newcastle and Sydney.
Some key trends underpinning the property market in 2020
We believe there have been several reasons for the buoyancy our local property market has experienced over 2020. These include:
- Low stock levels. There are fewer properties available for sale than usual and this is combining with strong buyer interest to create intense competition. This result is fewer days on market and good sales prices.
- A shortage of rental properties. This has been also keeping the local residential leasing market competitive and on an upwards trajectory.
- Strong demand for lifestyle properties. This is being driven by population growth in the Hunter Valley more broadly. We talk more about this below.
- Record low-interest rates. The very low cost of borrowing makes it cheaper than ever to buy property, for those unaffected by the pandemic.
- Government grants and schemes. These grants and schemes have been helping first home owners and others to get into the property market or build their own home.
2020: The data
We know the Hunter is a great place to be now it seems others have caught onto this too. According to the REA Insights Regional Australia Report for 2020, the Hunter Valley (excluding Newcastle) came ninth on the list of the regions that experienced the greatest population growth over the past five years, lifting 6.7%. Now, our observation is that COVID-19 is accelerating the trend of city dwellers shifting to the regions, with many seeking a tree change or better lifestyle – something our area can offer in spades.
We’ve been experiencing consistent sales growth over 2020 and it has been very much driven by Sydney buyers looking to relocate. These buyers tend to be tree changers from a wide range of demographics. They include young families as well as retirees, professionals, and other people who can work from home and commute one or two days a week to Sydney or Newcastle. They’re enticed by the small acreages they can buy for around $900,000, as well as the great suburban homes in our towns.
For example, in the last quarter we’ve sold 10 of these lifestyle acreages. And in town, buyers, including first home buyers, are competing head-to-head for family homes with lifestyle potential.
This competition is filtering through all parts of the market. According to realestate.com.au, the median house price in Singleton rose from $378,250 in December 2019 to $407,500 at the end of November 2020. This was the equivalent of a 7% gain in 12 months.
Singleton’s median unit price also increased from $210,000 to $242,500 – a massive 15% rise.
The rental vacancy rate currently sits at an incredibly low 0.74%, according to realestateinvestar.com.au. Rental yields range from 4.7% for houses to 6.93% for units.
2021: The future
With 2020 a year like no other, predicting what will happen in 2021 is no easy feat. But if economic, health, and market conditions remain as they have, we forecast a strong start to the property market in 2021.
The big news for buyers and sellers could be the NSW’s government’s proposed changes to stamp duty. Set to be confirmed in mid-2021 after some public consultation, the changes will our upfront stamp duty system phased out and replaced by a smaller, ongoing annual property tax.
If these reforms go ahead – and there’s little reason to believe they won’t – they will remove one of the main obstacles buyers face when it comes to buying a property. This has the potential to change the dynamic of the property market altogether and could trigger a lot more activity. Stay tuned for more details in 2021.
Want to know more about the state of the local market?
Find your ideal home in the Hunter Valley region by contacting One Agency Lindy Harris today.