Shoalhaven property market: Not much available under $1 million

People looking to secure their first home in the southern Shoalhaven are coming up against skyrocketing property prices, with some postcodes recording a median house price of $1 million.

With first home buyers desperate to break into the housing market in their home town on the south coast, many are being forced to break their budget to secure a property.

There’s little available on the market under $600,000 in the southern Shoalhaven, LJ Hooker Ulladulla principal Lisa Cox said.

“It is difficult for young people to try and get a foot in the door,” she said.

“If you wait until you can afford to buy a house you will never buy one because the market just keeps going up.”

South coast real estate agents are selling properties quicker than they’re coming on the market.

According to data from CoreLogic, the median house price in the 2538 postcode, which takes in Milton, surpassed a million dollars in the past 12 months. In the 2539 postcode, which includes Ulladulla and Mollymook, houses were selling for a median price of $830,000.

“The region is recording a surge in housing values, up 28.6 per cent and 28.4 per cent across the postcodes of 2538 and 2539 over the past twelve months,” CoreLogic Research Director Tim Lawless said.

“The current rate of growth in housing values is substantially higher than the five and ten year average rate of growth, demonstrating the surge in housing demand against a backdrop of limited supply.”

However, Mrs Cox said some first home buys were breaking to the market, splurging upwards of $650,000 on rare listings below the $800,000 mark.

To be eligible for the federal government’s first home buyers deposit scheme, the purchase price has to be under $600,000.

“It’s very hard to get anything under 650,000 at the moment, that seems to be the bottom of the market,” she said.

“We are seeing people go away and save some more to get an opportunity at the market.”

The median house price in some areas is over $1,000,000.

Rents increasing in the area as more people opted for a regional lifestyle was also a factor in people making the leap into the housing market, Mrs Cox said.

Houses for rent attracted an average weekly price of $606 dollars in the 2539 postcode and $604 a week in 2538, according to CoreLogic data.

While units in the region were available for an average rental price of $461 per week, the average price of rentals increased by 15 per cent over the last 12 months.

“With rents pushing up quite a lot lately, people are realising they can actually service a mortgage for the same price as renting if they get a property for $650,000,” Mrs Cox said.

Breakwall Finance director Holly Fleming said people looking to buy their first home needed to “lower their expectations”.

“They come in and want their dream home or a fancy four bedroom brand new place straight away and we like to say it is not always a possibility to find something like that in their price range straight off the bat,” Ms Fleming said.

“If you do find something in the $600,000 mark and it might need a bit of TLC, consider that as an option because our equity growth is extremely strong on the south coast at the moment.

“Although it might not be exactly what they’re wanting, it will be a rare find and it is good to jump on the opportunity while they can.”

To avoid mortgage stress in the future, Ms Fleming said home loan applicants needed to be “very honest” in their applications.

She said Netflix subscriptions, gym memberships, Spotify accounts and Afterpay were all taken into account by lenders and that declaring them was important.

“Banks will look at living expenses over a three to six month period so if they are considering going for a home loan it is really important to be mindful of their spending,” Ms Fleming said.

“If we feel an applicant can’t finance a loan, we say no and point them in the direction of a financial planner.”

LJ Hooker Ulladulla principal Lisa Cox believes the south coast property market will continue to increase, as stock remains low and interest in the local market remains high.

The Ulladulla broker said she was currently seeing more clients wanting to refinance their loans, than people seeking new loans.

Ms Fleming said people were saving as much as $3500 per month by refinancing.

“We have had clients come off a 5 to 6 per cent interest rate and they’re now down to that 1.84, which is a significant saving,” she said.

Meanwhile, Mr Lawless said the annual pace of growth in housing values remained under “consistent upwards pressure”.

“Similarly strong conditions can be seen in other regional coastal areas, reflecting a nationwide sea change is underway as more people seek out lifestyle options and take advantage of more flexible working policies with regards to working from home,” he said.

Mrs Cox said there was still a lot of local activity in the buying market, but there was an increasing demand from Sydney buyers looking to relocate to the region.