Waterfront property prices are booming, with new research showing that those wanting to snap up a home with uninterrupted views of an ocean or river could end up paying double the price for the privilege.
Australia’s waterfront properties are now worth 69 per cent more than those that are not perched on the water’s edge, property consultancy Knight Frank’s The Australian Waterfront Prime Index for the September quarter found.
This was a jump of almost 6 percentage points since the same time last year.
Knight Frank Head of Residential Research Michelle Ciesielski said premiums were rising as cashed-up buyers, stuck in Australia due to the coronavirus pandemic, looked to add waterfront property to their portfolios.
“When we’re talking about the ultra wealthy population, having a waterfront property provides options for people who would otherwise be agile around the world,” she said.
The index, which measures the rise in coastal, harbour, canal and riverfront property values in Australian capital cities, revealed, perhaps not surprisingly, that Sydneysiders would pay the biggest premium for an ocean view.
Buyers can expect to pay more than double – or a 104.7 per cent premium – for a beachfront abode. That rose by almost 10 percentage points since September 2019, the research showed.
While buyers expect to pay a premium for uninterrupted water views, the scarcity of stock and the finite nature of waterfront land often helped drive prices up, said Sydney Sotheby’s International Realty director Michael Pallier.
Mr Pallier said waterfront properties in the harbourside and eastern suburbs were very tightly held, with some people paying three times as much to be right next to the beach.
“There is strong demand but they rarely come up for sale,” Mr Pallier said. “They often sell if the owners have been living there for a long time – 20 or 30 or more years – and they’re getting older and want to be closer to the shops.
“They rarely sell … You have beautiful views and you can swim or even fish off the balcony. There’s just something about being close to the water.”
The relaxed lifestyle is one of the reasons Selina Corkill will be looking to stay close to Coogee after she sells her home in South Coogee at auction.
Selina Corkill’s home in South Coogee is up for sale.
The duplex, which she shared with late husband and architect Tony Corkill for more than 10 years, includes stunning views of Coogee Beach and is just metres from the ocean.
“It’s a very special place,” Ms Corkill said. “We often had people around to have lunch on the deck or for parties.
“I really want to stay around in Coogee and I think I’ll be looking around for a while. I might rent before I buy another home,” she said.
One of biggest jumps in waterfront property premiums was recorded in Perth, where river and beachfront property premiums were 61.1 per cent – up 7.5 percentage points since September last year.
The market in Margaret River had seen a number of homes selling in recent months, with some people paying double for a waterfront home than what they’d pay for a similar home one street back from the water.
Space Real Estate’s Paul Manners said like Sydney, waterfront properties in the area were very tightly held.
“The demand has increased a lot,” Mr Manners said. “The people who are looking are above the owner-occupier buyers and are lifestyle investors.”
Since more people were working from home, they were able to buy waterfront properties to live in longer term, he said. Many love the fact the Margaret River offered not only beautiful waterfront views, but also activities.
“There’s the beaches and the river but it’s also got great bike trails and you’re surrounded by nature with the forests,” Mr Manners said. “There’s amazing restaurants and it’s just a more laidback lifestyle.”
While Melbourne may not have the same great weather as Sydney, Perth or the Gold Coast, waterfront homes are still very sought after.
“It’s not just the same old aspect [view] every day,” Marshall White Stonnington director and auctioneer John Bongiorno said.
While he could not quantify how much more people paid for a waterfront home, there was a higher price to pay for the uninterrupted view.
“It’s just part of the Australian psyche to get close to the sea and get the changing views,” he said.
Article Source: domain.com.au
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