Escape to the country

Seeking city benefits without the downsides, buyers are flocking to country and coast in a trend that is rewriting the rules.

Picnic Island, Tasmania

It used to be said that you should never buy a holiday home more than three hours from your capital city, but with teleworking and hi-speed internet, the rules are being rewritten. Vacation boltholes aside, city dwellers are also looking to move away from their suburban homes or apartments on a more permanent basis. But their timing could be off, with agents on the ground reporting a surge of interest in coastal locations from like-minded city dwellers aggressively competing for beachside mansions or rural estates.

COVID-19, limits to international travel and a lack of stock is driving up property values in regional townships, from the NSW Central Coast to idyllic Byron Bay, and even further north. Both coastal areas have experienced record sales in the past few weeks – with a beachside mansion in Byron’s Wategos Beach selling within five days of hitting the market for a record $22 million on behalf of Morgan & Banks founder Geoff Morgan.

Setting of the record sale at Pearl Beach

Closer to Sydney, on the NSW Central Coast, Stuart Gan of Central Coast Realty has just broken long-held records in Umina and Pearl Beach, north of Sydney. Gan recently sold the beachfront home of a former Goldman Sachs investment banker in Umina for $3.9 million, just two years after it sold for $3.225 million. At nearby Pearl Beach, he sold a four-bedroom house in Green Point Road for $5.85 million – breaking that suburb’s record. The coastal property last fetched $3.95 million in 2012. “We are finding that low stock levels and increased demand for holiday and seachange property is driving a two-speed real estate market, with coastal regions surging while population centres lag behind,” says Gan.

Veteran rural agent Chris Meares says city slickers are looking to buy holiday and permanent homes away from COVID-congested cities, and he’s never before seen such interest in coastal areas such as Newcastle and Wollongong, north and south of Sydney. Hinterland areas, including the NSW Southern Highlands, which is also within 90 minutes of Sydney and deemed “semi-rural”, are also gaining in popularity.

The Pearl Beach property

“People are being selective and looking for those areas that will give them the benefits of living in the city but not in a congested environment,” says Meares. “The attraction to the coast is real. There’s also a lot of focus on Tamworth, Wagga, Albury and Armidale ... but Orange is arguably the best rural city in Australia. These major centres are attracting people for permanent relocations; they have people coming who are making a complete change of direction with their lifestyle.”

Relocators are either looking for local employment or remotely working, an option Meares says is certainly popular. 

South of Wollongong, the scenic hamlets of Milton – where fashion designer Collette Dinnigan owns property – and Dolphin Point are also doing well, with virtual sellouts of house and land subdivisions near the water. But the performance of Dolphin Point, Milton and even Nowra will be hampered price wise until the Nowra Bridge Project, a new four-lane bridge over the Shoalhaven River, is completed. Locals report back-to-back traffic along the Princes Highway during the warmer months, which does not bode well given the $342 million state and federally funded project is not expected to be finished until mid-2024.

the beachfront property at Umina recently sold for $3.9 million;

But inland rural properties are doing well. Meares is expecting a large number of inquiries from prospective buyers in Canberra and Sydney for a 100 acre cattle property called Arundel he has just listed, near the village of Collector, halfway between Goulburn and the ACT. A European stone-style house positioned along a long drive is the drawcard of the property, which has hit the market because its owner wants to retire. The asking price is around $2 million, slightly down on initial expectations. 

Closer to the coast, Meares reveals that his holiday house at Blueys Beach, 3.5 hours north of Sydney, is enjoying wall-to-wall bookings until Christmas. “It’s incredible – the locals tell me every week up there is like Christmas and New Year,” he says, adding that the house’s rental popularity has never been this strong.

While multi-billionaire apartment developer Harry Triguboff told The List he is not so sure prices will surge in rural and regional areas, celebrity agent John McGrath, founder of McGrath Estate Agents, expects them to rise from next year.

McGrath says that in some of his rural and regional offices in the NSW Hunter Valley and the NSW Southern Highlands, his agents have never been busier. “If you did not know about the pandemic you would think this was a real estate gold rush,” he says. “Regionally, Byron Bay is extraordinarily strong; we have not seen this level of buyer inquiry. Queensland’s Sunshine Coast and Port Macquarie are also strong ... and we are finding that demand in these regional areas spikes particularly if there is a nearby airport.”

However there is a caveat, according to McGrath, and it’s whether Wall Street likes the outcome of the US election, and whether in turn the local real estate market likes it too. “But interest rates are going nowhere and there’s a stock shortage,” he says. “These are far more likely catalysts for an upswing.”

The $3.9 million house in Umina

In NSW, McGrath suggests buying a permanent or holiday residence in Thirroul near Wollongong, adding that it is not far south of Sydney and the prices are achievable – unlike the more popular and more high-profile NSW holiday boltholes of Palm Beach or Terrigal. Releasing his annual McGrath Report, a snapshot of the property market in the eastern states, he also likes Noraville, a quiet little village just north of Sydney on the Central Coast. 

“With the pandemic showing everyone how easy it is to work from home and the new NorthConnex lopping 20 minutes off your trip to town, you’ll make great money over time securing a cottage in the seaside suburb of Noraville for the price of a one-bedroom apartment in Sydney,” he says.

In Queensland, McGrath picks regional areas such as Sunrise Beach on the Sunshine Coast because prices are about 45 per cent cheaper, at $975,000, than surrounding areas such as Noosa. He says Sunrise Beach doesn’t attract the headlines or celebrity buyers its famous neighbours do. 

“It also hasn’t had the same rate of growth that Sunshine Beach has experienced in the past three years. However things are changing, with original beach houses being renovated and new listings becoming scarce due to its relative affordability, and the appeal of its comfortable beach lifestyle, surf scene and proximity to Noosa National Park.”

Burleigh Heads on the Gold Coast is also one of McGrath’s top picks. He notes a 33-unit apartment tower released in March was 90 per cent sold on its first day, with prices starting at $1.85 million. 

Picnic Island, Tasmania

In Perth, Ray White agent Jody Fewster has just sold one of the city’s most expensive homes, in Watkins Road, Dalkeith, for $27.5 million. It happens to be her childhood home – she is the daughter of Alan Bond. Fewster says Perth residents are buying out of town.

“I am hearing they are buying for both reasons – holiday homes and permanently,” she says. “The more they realise travel is not going to be what it was, the more locals are looking for holidays closer to home.”

Tasmanian entrepreneur Clem Newton-Brown, a barrister, town planner and former Liberal Member for Prahran, is so enamoured of the COVID-19 push away from cities that he is looking to raise cash to buy more islands off Tasmania.

“You can’t get more wild than being on an island off Tasmania, summer or winter – it is totally different,” he says. “I am not talking about building resorts with swim-up bars; it’s a raw tourism experience. I am looking at a range of different tenures to utilise these islands for long-term tourism leases.” He adds that he is looking at up to half a dozen sites.

Newton-Brown’s two existing properties, at Picnic Island off Tasmania’s Freycinet coast and Flinders Island, are jam-packed with holidaymaker bookings from the Apple Isle, given that the state has been shut off from the mainland.

“I have never been busier on both my island properties, and that’s just with the Tasmanian market,” he says. “When the borders open that will change.”

Newton-Brown is using crowdfunding to purchase more islands, which will be owned via either leasehold or freehold, or through partnerships with existing island owners such as the Aboriginal Land Corporation.

“I think the market for Tasmanian islands is a niche one where it is a very different experience from going to a tropical island,” he says. “In the COVID-19 world, the winners in tourism are going to be the smaller bespoke experiences where you are offering something unusual, isolated, and opening people’s eyes to parts of the country they never would have considered because they have been too busy saving up for a holiday in New York, Greece or Bali.”

Brisbane-based CBRE director Wayne Bunz, a specialist in selling luxury hotels, says Byron’s real estate market is perhaps the best example of the trend. He notes that while interest is massive in Byron Bay and its hinterland, houses in the inland hippy township of Mullumbimby are now selling for $2 million apiece.

“A lot of Melbourne people are also moving to Noosa,” Bunz says. “High-end Gold Coast agents are selling multi-million houses over the phone, with most of the buyers from Melbourne. I think the net migration to Queensland is going to be massive, mainly from Victoria out of COVID-19.”

This is already being seen, with Sydneysiders and even a Californian buyer accounting for a large chunk of purchasers in a new beachfront development. The $74 million Flow Residences project in Rainbow Bay in Queensland’s Coolangatta sold out in just over three months. The complex’s 22 two-, three- and four-bedroom apartments sold for an average of $3.5 million, with seven apartments sold to NSW buyers and one to a Californian. Two professional surfers were among the buyers.