NSW Illawarra Coast (North of Wollongong)

Hi,

I'm just wondering if anyone has thoughts on this area at the moment? (possibly in comparison to Central Coast...).

Thinking particularly about the Austimer to Fairy Meadow suburbs, and it seems as though prices drop as you head down the coast (median 4 bed prices range from approx. $1.1m down to about $700k). Its seems this area has seen good growth over the last 3-5 years, and I wonder if it will continue with people being priced out of Sydney (at least in the short term)? Thirroul is on the express train line into Sydney, and Austimer looks like it has a few options too, so I guess this would be preferable?

Most seem to have seem to have the lifestyle drivers to attract owner occupiers (maybe except Austinmer, but they aren't far away).

Not may 4 bed houses for rent in the area, so does anyone know if this is due to a shortage, or to lack of demand, as there is plenty of 3 beds?

Also, does anyone have any feedback on Coniston (near the station), quite different to the above I agree, as you would probably be looking for tenants who work in the local area?

Our budget is up to $1m, so we would be looking at 4 beds in most of these places, maybe a 3 bed further north. My rough analysis has shown me that those situated further North seem to attract a better demographic (higher earners/managers/professionals, more OO %, less public housing), and I guess no surprises there with its proximity to Sydney. We are looking for CG and not worried too much about rental yield at the moment.

Many thanks in advance.

Dan

 

Calling @BuyersAgent

 

Good luck finding a 3-bedder, let alone 4-bedder, under 1m anywhere north of Woonona, except perhaps a townhouse! House prices in Bulli, Thirroul and Austinmer have been rising at breakneck pace for the last few years but seem to have reached a plateau in recent months, with more time on market and more slow or failed auctions. Don't think there's any significant CG left to squeeze out for a while, and rental yields are as bad as in Sydney. Indeed, once Sydney prices begin to fall, the northern Illawarra will follow suit as the incentives for Sydney folk to move down the coast get weaker. The commute is pretty awful with slow, infrequent, and overcrowded trains so once Sydney becomes more affordable again, the seachangers will quickly lose enthusiasm.
Woononais a little cheaper but rapidly gentryfying as people are priced out of Thirroul and Bulli. But there's little decent stock on the ocean side of the quasi-motorway cutting through it. Further south, you have Bellambi which is very cheap still but for good reason (nobody wants to live there as it's considered "rough") and Corrimal which is only marginally more attractive. Towradgi may have some investing mileage in it with plenty of not-too-expensive housing quite close to the beach but large parts of it are floodprone (that applies to almost the entire region, of course).
Great place to live but can't see much in it now for the investor after quick CG. This goose has been well and truly cooked.

 

Thanks Ellejay

Gday @DanInSyd - what would you like to know? You have a few questions and assumptions there. The general trend of higher prices up north reducing as one moves south is true but there are too many sub markets in the Illawarra to list properly. Also not all the northern suburbs are low public housing. Check Bellambi point as just one example. And while we are on that topic proximity to Sydney has nothing to do with public housing percentage. 15 yrs ago I spend 5 years working in Waterloo which has both proximity to sydney and high density public housing.

In terms of your goals I would say you need to think about both cg and cash flow if you plan on buying more than one (unless you already have a huge trust fund) as banks are making servicablity a key issue at present for any multi property investors. Nothing wrong with 4 bedders, they are in demand with families for rent but think carefully about the location and the pricepoint ensure it fits in your overall goals. Also some properties have had lots of growth, others are still more affordable so be aware of the ripple effect to try and maximise your return.

 

Thanks @BuyersAgent

I guess i am just thinking about areas that still have room for growth, that havent had to much taken out of them already? It is hard to know in this area as it seems it has experienced rapid growth recently, and although we are not in the market for a quick buck, I don't want to be looking in a market that will remain flat for the next ten + years, especially whilst financing the debt.

After I read my OP back, it seems I did link low public housing % to being closer to Sydney, which I didn't mean to link together! Oops. My point was about the areas seeming more affluent the further North you head, which I assume is part of the ripple effect.

I agree we do need to consider the trade off between CG and Cash Flow (no huge trust fund here!), but we are both good enough earners to not concern us too much at present, and our broker hasn't suggested any issues in the short term.

Is the Northern Illawarra near a peak, and the areas South of the Gong be looked at more favourably? We have noticed prices rising as far down as Nowra (and beyond) over the last few years, but maybe not at the rates of those further North which is understandable due to proximity to a major city.

I guess we had been intending to look for areas that appealed to both those working in the area, and who commute to Sydney, but maybe this is the wrong approach?

 

Your logic is sound, the ripple effect is still in play and happy to discuss if you ever want to set up a phone appointment. The commuter options are a great option to work on but not the only impact on the market at present. People are also moving for lifestyle. Yes some areas have grown more than others at present. The flip side of this is that some areas represent better value than others at present but of course it depends on your personal approach and goals as well.

 

Hi @DanInSyd, did you finally found something in the area that you've been looking for?