COVID-19 has helped accelerated a rising phenomenon of homeowners being able to work remotely. As more a drawn to property lifestyle options the choice must be made between the beach and the bush. But which is better in terms of capital growth?
RiskWise Property Research has done the hard work and identified the key areas to buy and what to expect once the property market stabilises in a post-pandemic era.
RiskWise CEO Doron Peleg said the onset of COVID-19 changed the way Australians worked as a nation with vastly increasing numbers working from home - and it was here to stay.
"Australians who have had a taste of working from home over the last few months are now able to continue to work remotely and it's these buyers who are now seeking lifestyle properties and avoiding higher density locations.
"COVID-19 had helped strengthen 'work from home' opportunities meaning owner-occupiers can take advantage of 'lifestyle' prospects instead of being tied to employment hubs.
"Before COVID-19 hit, there was already a strong trend of sea- and tree-change homebuyers looking for the best of all worlds – lifestyle, accessibility to employment hubs and affordable housing.
"These include areas of southeast Queensland such as the Sunshine Coast and the Gold Coast, just over the NSW border in Byron Bay and further south on the Central Coast, in areas such as North Avoca, Terrigal and Wamberal. Then there's also sought-after locations such as the Hunter Valley, Wollongong and the South Coast, and in Victoria, the Mornington Peninsula, Geelong and Ballarat."
Mr Peleg said beachside suburbs especially outperformed the market as they offered such fantastic lifestyle opportunities.
In fact, many investors consider both sea and treechange areas to be 'investment destinations' in which to achieve strong capital growth.
RiskWise has undertaken an analysis of popular treechange and seachange to determine which will deliver the stronger price growth in the next few years. The results showed that over the past five years seachange areas delivered more than double the price growth than treechange areas. (36% to 18% respectively).
Mr Peleg said part of this was due to the popularity of beachside areas which had significantly increased in the past few years.
"However, treechange areas in general are significantly more affordable with a median price of $410,849, and seachange, $742,528," Mr Peleg said.
Top 7 Seachange Areas for Houses
Kingscliff delivered the strongest price growth of 61 per cent over the past five years with Noosa Heads and Lennox Head the two next best performers at 49 per cent and 47 per cent respectively.
Byron Bay was recently identified by RiskWise as one of the Top 7 regions in Australia to retire because it offered good lifestyle options and solid capital growth.
However, with a median house price of around $1.34 million, where beachside properties cost multi-million dollars, this area requires very healthy equity.
The Sunshine Coast, including Noosa Heads, also made it to the Top 7 list of places to retire, due to lifestyle and capital growth, with a median house price of around $1.16 million.
Top 7 Treechange Areas for Houses
When it came to treechange areas, Birregurra in Victoria topped the list for capital growth over a five-year period at 54 per cent with Evandale in Tasmania close behind at 40 per cent.
"It's clear from these figures that seachange beats treechange hands down when it comes to solid capital growth," Mr Peleg said. It's simply a matter of supply and demand. The supply of beachside properties in warm areas are way below the demand. On the other hand, the availability of 'treachange' areas is way higher, as we all know Australia is a big country with many lovely regional areas to choose from."
"This is largely due to the amazing lifestyle options on offer along our coastlines that appeal to so many people and often there is good value for money to be had especially if migrating from capital cities such as Sydney and Melbourne."