Surf Coast Real Estate Snapshot: Market Trends And Update

The national media is reporting about a property market in decline.

However, CoreLogic’s Regional Market Update, which was released in August, contains some interesting insights into the Surf Coast property market. And these don’t necessarily confirm what’s happening in the market more broadly.

Here’s what buyers and sellers need to know about the Surf Coast property market right now.

The headline news

It’s hard to escape the doom and gloom of the news headlines about a declining property market. CoreLogic data shows that, nationally, home values fell by -3.4% in the August quarter. That’s the most significant quarterly decline in home values since the 1980s.

But the reality is that most of these falls have been in the major capital cities. For example, Melbourne property values fell -3.8% over the last quarter and -2.1% over the last 12 months.

We simply aren’t seeing this same pattern play out on the Surf Coast yet.

Prices were still rising to July 2022

Prices on the Surf Coast continued to rise by an impressive 15.6% over the 12 months to July 2022, to reach a median value of $1,591,779. This is on top of some 2021’s large gain where we saw local prices rise a staggering 43% to hit a median of $1.4 million. However anecdotally, since July, we have noticed that the market is not quite as buoyant as the July data suggests with most properties taking longer to find a buyer than has been the case previously.

Sales volumes are down

In part, prices have remained high because there’s been less stock for sale on the Surf Coast. This is probably due to a mix of reasons, such as the seasonal slowdown during winter, concerns over interest rates, and the general global uncertainty that’s on many people’s minds. Data shows that sales volumes fell almost 20% over the 12 months to July 2022, meaning there were only 601 houses sold over the entire 12 months.

While stock levels have been low nationally, CoreLogic estimates that the Australia-wide trend was for just a -2.3% decrease in sales volumes to August 2022 and that in the capital cities the difference was just -0.1%.

So the Surf Coast market remains a tight one when it comes to supply, meaning vendors have less competition and buyers have less choice.

Bargain are still hard to find in this market

Buyers need to be aware that the Surf Coast market behaves differently to Capital City markets and is less sensitive to interest rate rises. It is still an aspirational destination that is in high demand and vendors usually don’t need to discount significantly, as long as the price is set accurately. There are few – if any – bargains to be found, and they need to put their best foot forward.

This is reflected in a low local vendor discounting rate of just -3.5%. For comparison, in Melbourne and Australia-wide, this rate is currently -4%. In Sydney, the city which has experienced the largest price falls, vendor discounting has risen to -5.0%.

The story in our wider area

The report also provides statistics for Geelong Statistical Area 4 – which takes in the Surf Coast, including Anglesea and Torquay – and these provide further insights into our local property market.

• While sales volumes are -5.4% lower than one year ago, they remain 8.3% above the area’s five-year average – which partly reflects the growing population and increased number of dwellings in our area.
• Across the wider area, house values rose 10.8% and units 6.4% in the year to August 2022. This means we now have a region-wide median of $838,814 for houses and $565,732 for units.
• Most units in the region sell for between $400,000 and $600,000, while the majority of houses sell in the $600,000-$800,000 range.

A strong rental market

This remains a booming time for our local rental market, which is good news for property investors but is creating challenges for renters.

The vacancy rates across the Surf Coast has fallen to just 0.41%, according to realestateinvestar.com.au, with rents rising 11.81% for houses and 12.5% for units over the past year.

We’re continuing to see strong demand for rental properties from locals and also from e-changers and sea changers moving to our area – part of a nationwide tide of migration to the regions.

The data

Here’s where the Surf Coast property market was at on 23 September 2022, according to realestate.com.au data.

Torquay
Houses median property price: $1.33m
12-month growth: 30%
Houses median weekly rent: $625
Units median property price: $975,000
12-month growth: 21.1%
Units median weekly rent: $500

Anglesea
Houses median property price: $1.7 million
12-month growth: 36%
Houses median weekly rent: $650

Jan Juc
Houses median property price: $1.39 million
12-month growth: 6.9%
Houses median weekly rent: $650

Further information?

If you’re looking to buy or sell on Victoria’s Surf Coast, contact me for further information.