Adam Sparkes What 2020 Means For Brand New And Off The Plan Sales
We are seeing that the two sectors of the market that have remained strong are at polar opposites when specifically relating to property price points and values. Since COVID-19 pandemic hit in March, both the affordable and the prestige ends of the market have performed extremely well.
At the lower end we are seeing good levels of enquiry where buyers are ready to act, many taking advantage of the First Homeowners grant and numerous concessions on offer. We are seeing high demand in the outer lining areas of Sydney and some inner areas of Brisbane with price-pointed stock (typically sub $500K dwellings), selling quickly. Suburbs such as Mt Druitt (greater Western Sydney) and Newstead (inner Northeast of Brisbane), have been attracting younger homeowners that have been furiously saving since COVID first hit.
Now cashed up and ready to buy, many are seeing there has never been a better time to consider getting into the market. Astute first homeowners and upgraders can see true value for their hard-earned savings. With the current low interest rate environment making potential repayments less than paying rent, we are seeing a marked increase in sales at the affordable price band.
By contrast, at the upper end of the spectrum we are also seeing strong demand for the Super Prime apartment sector. We have experienced new enquiry across all three States - Victoria, NSW and Queensland - all looking for opportunities at the luxurious end of the market. With eye watering prices ranging between $3M to over $10M enquiry levels for ‘high end’ product have dramatically increased.
In Sydney we have had access to the Crown Residences at Barangaroo now less than six months from completion. When ready for occupation, these exquisite residences will be completed to the highest standard of finishes, quality and amenity in the Country placing the building (and Sydney) amongst the elite on the world stage for truly prestige apartment living.
In Melbourne even during the extended lock-down there have been good sales rates for Salta’s Walmer Residences positioned on the banks of the Yarra River in the suburb of Abbotsford. Designed by Bates Smart, Walmer offer buyers unusually large home-sized apartments. Over the period of the Victorian shut down we have fielded a number of enquiries - many frustrated with not being able to physically inspect. As the laws have begun to relax, we have secured a number of sales with clients taking advantage of the off-plan opportunity to amalgamate two dwellings into one supersized apartment. This has allowed discerning purchasers a chance to add a ‘customized’ approach by designing floor plans to suit their ‘ideal requirements’.
In Queensland we have also seen a flood of enquiry from all corners of the Globe singling out the Sunshine Coast as a preferred lifestyle destination. With our Beachfront development has registered a number of sales between $1.5M to over $3M including expats residing as far afield as New York and Dubai looking to secure a suitable high-end property for their eventual return to Australia.
So where does that leave the mid-priced new developments across the Country? For projects that may not have a significant point of difference or are priced with Developers expectations of sales achieved in 2016/17, we are seeing buyers react with a cautious approach. There is still somewhat of a stigma for new apartment towers off the back of articles dating back to Christmas 2018 all to do with ‘build quality’.
Whilst we are seeing a decrease in enquiry for the mid-price range project offerings (circa $800K - $1.5M +), we are finding our buyers are now seeking specific information that relates to the build quality. They are wanting to know the past achievements of both the developer and construction teams in order to give confidence before they commit.
In summary, we expect to see continued interest from locals across all price points for new and off the plan projects across our entire portfolio. Fast forward to when international borders re-open we expect to see renewed interest for Australian new developments from all corners of the Globe. Now more than ever, Australia will continue to hold appeal as not only the Lucky Country, but also a safe haven for international property purchasers.
The views expressed in this article are an opinion only and readers should rely on their independent advice in relation to such matters.
This article originally appeared in The Real Estate Conversation (November 06, 2020)
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