Byron first time buyers of house and land packages beware: HTW

The first home buyers grant is providing financial help for first timers to purchase land and build in the Ballina region, according to HTW’s Month in Review: March 2017. 

The valuation firm says Suffolk Park and Byron Bay seem to be outpriced for first home buyers, but first home buyers are looking to build in this area utilising land and home packages to their advantage.

It points to the new estate known as EPIQ in Lennox Head, where vacant land prices range from $250,000 to $300,000, as one such example.

HTW also says that in the Ballina and Byron Shires, there has been increased evidence of group buying.

“This is more specifically noted in the new coastal estates located at Wollongbar, Cumbalum, Lennox Head, and also using already established property in Ocean Shores,” it says.

“Potential buyers seem to work together in purchasing VL blocks over 800 square metres and then look to subdivide.

“We have also seen groups of two buying established homes that already contain one main house, and look to build another dwelling (as seen in Ocean Shores).

“Developers in the areas of Byron Bay and Ocean Shores seem to be creating products that are helping first home buyers get into the market.

“These development works include the construction of units containing one and two bedrooms at maximum.

“In this effort to minimize the overall accommodation provided, it in turn lowers the overall cost, which therefore opens it up to the first home and entry level buyers.

“This product is appealing as it is creating a new way of affordability in the coastal resort market.”

However, HTW cautions buyers against these products and says first home buyers looking to enter the market right now should try and buy an established property.

“As new estates are released, local builders have been able to increase their building costs, resulting in a higher rate per square metre in turn pushing the price up on a house and land package,” it says.

“Therefore, there seems at the moment to be better value in finding an established house to purchase at a lower price.

“The cost of building is slowly increasing due to a high demand of builders verses lack of builders in the Ballina and Byron Shires.

“First home buyers should pick a path of either buying a unit or an established home to maximize their money for value.”

Units either in Cumbalum or Ocean Shores, with medium unit price points of $350,000 to $500,000, may be attractive options.

For established homes, HTW suggests first time buyers look at Ocean Shores (a median price point of $450,000 to $550,000) or in Lennox Head ($600,000 to $700,000).

“The current low interest rates are on your side, but if you were looking specifically at long term capital growth historically this has been achieved closer to the coastal regions,” HTW says.

“The biggest mistake that valuers have seen first home buyers make in the Ballina and Byron Shires is a lack of careful planning in regards to additional costs upon entry into a property.

“For example buying land and building, first home buyers may not factor into their budget addition costs such as window furnishings, fencing, landscaping, retaining walls and other such additions that increase the initial market cost of the home from beginning to end.

“We have also seen the same costing mistakes in the established housing market, where there has been a lack of planning for renovations or improvements.”

A three bedroom unit at 3/1 Bindaree Way, Ocean Shores (above) was recently sold for $390,000.

Similarly a set of residential land at Lots 16-38 Seacliffs, Suffolk Park (below) has a price guide of between $600,000 to $660,000.