Sydney real estate: the beach suburbs where home prices are skyrocketing

Living near the beach is getting more popular but it’s not Manly or Bondi attracting the most buyers, with homes in one sleepy coastal area commanding prices 40 per cent higher than in 2019.

Property prices have been skyrocketing across NSW’s coastal suburbs during the pandemic as the “landlocked wealthy” from Sydney’s inner suburbs and north shore scramble for homes near beaches.

Properties in some coastal pockets are now commanding prices nearly 40 per cent higher than before the pandemic – an increase of hundreds of thousands of dollars on already lofty sums, sales data showed.

And real estate pundits expect the call of the sea to bring further waves of cashed up buyers over the year ahead as those working from home swap inner city locations for the coast.

Many of the suburbs and areas attracting a recent surge in buyers were near beaches further from the CBD, according to a realestate.com.au report provided exclusively to The Daily Telegraph.

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They included suburbs on Sydney’s upper northern beaches, such as Whale Beach and Newport, along with pockets of the Central Coast, such as Blue Bay, Chain Valley Bay and The Entrance North.

Realestate.com.au analyst Cameron Kusher said the increased popularity of beach living was a COVID-influenced trend.

Anthony and Alicia, with son Calian, are selling their Jenner St home in Little Bay. Picture: Christian Gilles

“The pandemic has made people re-evaluate their lifestyle,” Mr Kusher said.

“Being at home more, working from home three or four days a week, means people can look at areas they may have (previously) thought were too far out.”

Cashed up city families who recently sold homes in expensive inner suburbs were often behind some of the biggest price rises in regions such as the Central Coast, Mr Kusher added.

“For them, it’s a better home for cheaper, but the prices they pay are higher than what locals would pay,” he said.

The biggest price increase was recorded in Central Coast enclave Pearl Beach – an isolated suburb sandwiched between the ocean and Brisbane Water National Park.

The median house price in the area was marginally above $1 million in 2019 but shot to $1.47 million by November 2020, the biggest price hike of any beach suburb on Australia’s east coast over the period.

This Pearl Beach defied expectation when it sold in October for $5.8 million.

There was a similar median price increase (43 per cent) in Queenscliff, at the northern end of the Manly stretch of sand, but the rise was off the back of only a small number of sales.

Further up the coast, Whale Beach and Newport had average house price rises of 25-35 per cent.

Etch Real Estate principal Hugo Ortega said some of the biggest spenders on the northern beaches were “landlocked wealthy”.

They included families moving from pricey north shore suburbs who could outbid the competition for the scant supply of beach homes that came onto the market, Mr Ortega said.

“Demand is heavily outstripping supply and when that happens prices go up,” he said. “Homes near water are selling very well. For the buyer, the lifestyle is the focus, not proximity.”

Beach suburbs with biggest median price rises in 2020. NSW real estate.

Online property search trends, often an indicator of the next growth suburbs, suggested the trend of price hikes near harder to reach beaches would continue.

Buyers were also seeking out suburbs where they could get houses near the beach for less, with inquiries more than doubling in Central Coast suburbs MacMasters Beach and Booker Bay.

Further up the coast, listings in Forresters Beach, Chain Valley Bay and The Entrance North were attracting about 80 per cent more buyers.

There was a similar increase in Gymea Bay, a coastal suburb in the Sutherland Shire known for the historic Gymea Baths, which sit next to a small river beach.

Units were also attracting more buyers in Little Bay, a leafy suburb at the foot of Botany Bay National Park south of Maroubra.

This Pearl Beach house was listed in 2018 for $995,000. It returned to the market in 2020 and sold for $1.3m.

NG Farah agent Steve Ausling said the suburb was attracting a different crowd of buyers than before the pandemic.

“They’re younger, mostly couples in their 30s,” he said. “They usually want a good study area because they are working from home.

“For them, the area is a bit more viable. They can have a zoom meeting and then go off for a swim.”

BIG CHANGE AT LITTLE KNOWN BAY

Little Bay residents Anthony and Alicia have watched their “under the radar” Sydney beach suburb change dramatically since the pandemic.

The couple moved to the suburb four years ago, and will be on the hunt for a house in the area after they sell their Jenner St home, but report the area is different from when they first arrived there.

Anthony and Alicia will stay in the Little Bay area once they sell. Picture: Christian Gilles

“It was a bit under the radar,” Anthony said. “The beach is pristine and there is some of the most beautiful coastal scenery in Sydney, but it was a beach people hadn’t really discovered when we first moved. That’s changing.”

He added that he felt lucky to be living in the area while working from home and understood why more people were gravitating to the suburb after being in lockdown.

“We can go to the beach a lot, it’s just a few minutes away and there is a national park nearby. It’s great to have that all at your doorstep.”

The suburb is about 14km southeast of the CBD and the distance has traditionally kept prices lower than in closer suburbs. Unit prices average about $800,000, compared to $900,000 in Maroubra and $1.2m on Coogee.