CoreLogic research director Tim Lawless says lifestyle markets will experience substantial property price growth.
“Some of those iconic lifestyle markets that are close to capital cities like the Sunshine Coast, the Central Coast near Sydney, Surf Coast near Melbourne, and even the Margaret River in WA are all showing higher levels activity and that’s pushing prices higher,” Mr Lawless told nestegg.com.au.
While much of the value of these markets was wiped out by the 2008 Global Financial Crisis, property prices have started to recover in recent years.
“We saw that growth prior to the GFC and then lifestyle spending pretty much evaporated in 2008 on the back of people selling their holiday homes for obvious reasons. From 2008 to 2012, iconic Bryon Bay saw dwelling values fall by about 15, nearly 20 per cent but they have well and truly recovered now, rising by about 10 per cent per annum,” Mr Lawless said.
“You can see the same thing in Noosa or the Gold Coast, where the price growth isn’t quite as strong but we’re definitely seeing a recovery back to 2007 standards.”
There are two major driving factors behind this growth.
“We can see this sea change trend where buyers are coming out of Sydney and Melbourne with high levels of equity thanks to the wealth creation effect with property in those areas, and who are now looking to unload some of that wealth into holiday and retirement homes near coastal areas,” Mr Lawless said.
“With our ageing population, you’ve got to imagine there’s going to be a growing demand for these lifestyle markets as the Baby Boomers put their feet up. Whereas retirees saw their retirement savings halve in the space of six months in 2008, we’re starting to see those retirement plans come back into effect now.”
Mr Lawless said growth, buoyed by investment and a strengthening tourism sector, is expected to endure.
“Improving tourism numbers are seeing occupancy rates rise across tourist-centric markets which mean there’s more rental demand from service providers also impacting on the vibrancy of those economies.”