Southern Highlands prestige market sees COVID-19 induced surge: HTW
Staff reporterDecember 7, 2020
Quarter 1 of 2020 saw an atypical level of transactions (compared to the 2019 calendar year) within the prestige sector of the Southern Highlands, with sale prices remaining relatively static and no signs of major change in the high end residential and rural lifestyle segment, according to the November report from valuation firm Herron Todd White.
They found that Quarter 2 of 2020 saw the ripple effects of COVID-19 when the start of the lockdown in late March brought with it an unexpectedly positive impact on the prestige market for the Southern Highlands as the area was discovered predominantly by Sydney purchasers seeking a family home, secondary residence or weekender style of accommodation and lifestyle buyers seeking relief from the urban and inner city living environment.
HTW Property valuer, Tim Stevens said, "we had reasonably foreseen this upward trend over the medium term (six months) for the region as working from home became more common due to technological advancements and many employees being unable to attend their normal Sydney offices."
"What we didn’t foresee, but makes sense, is buyers flocking to the Southern Highlands region to take advantage of the lifestyle NOW given that overseas travel and family holidays are off the agenda for most of 2021 at this point. The impact of this upward trend became very evident early on in the COVID-19 pandemic and is showing no signs of abatement up to the present time."
"Quarter 2 and Quarter 3 of 2020 have seen multiple sales above $3 million and days on market for this segment have continued to contract to a matter of weeks now for well-located properties. This has been clearly evidenced by a number of older listings which had been on the market for over six months gaining traction and finally selling during this period."
By way of example, notable sales included two prestige properties in Burradoo which sold for in excess of $4.75 million dollars each after languishing on the market for the better part of a year.
HTW speculate that a large reason for the surge in activity in the $3 million plus sector is due to families in Sydney seeing extremely good value for money in the Southern Highlands.
Typically, $3 million wouldn’t be considered the prestige end of the market in Sydney, so when home owners from the Lower North Shore and Eastern Suburbs sell up and realise the scale of improvements and land size they can obtain for relatively similar money.
Another recent example was a $4 million plus rural residential purchase in Berrima by an eastern suburbs family which saw an agreed contract price with one prospective purchaser and an additional two families waiting in line to snap up the property in the event the sales agreement failed to close.
Mr Stevens said, "the question for our prestige market as we move into Quarter 4 of 2020 and beyond is about continued demand and buyer depth and whether the current move to regional hubs will be sustained, thereby driving continued price growth."
"For now, we can certainly see it continuing and it could well be that this push has been a long time coming, with recent events being the final straw for a number of urban dwellers to discover or rediscover the Southern Highlands and the benefits accruing from a rural and regional lifestyle," he concluded.