February 2022

This is the 43rd in a series of articles summarising monthly news and happenings in Sydney real estate, and more broadly.

Treechanger’s remorse or best of both worlds?

Will the movement away from the big smoke over the last 2 years come back to bite those that have done it? Core Logic asks the question here.

From what they say, it’s important to look at moving away from the city, that the surge in working from home opportunities provided, for what it is: a chance for a fresh start. If the regional brain drain to urban areas can be stopped or even reversed, then this can only benefit regional areas. We’ve all known for some time that the population focus on Australia’s major capital cities is inordinate at best, unsustainable at worst.

If enough tree changers can make their change work, using distance communication tools which a couple of years ago were largely unknown, knowing that there may be a few unknown moments in their plan, then this can only benefit everyone.

Having said that, it seems that perhaps the ‘gold rush’ of treechanging has peaked. In the Core Logic article, CoreLogic’s Head of Research Eliza Owen describes a historical lead-lag between what happens in the cities, and what happens in the regions, of roughly 3-6 months. Whilst noting that the last 6 months of 2021 seem to have disrupted this pattern, she says, “Despite the recent exuberance, I would expect growth rates in regional Australia to start slowing early this year.”

According to Domain (citing ABS statistics), 233,100 people moved from cities to regional areas in 2020. Figures for 2021 are yet to be released.

Of course, if you’re able to, why not have both? This article in Domain looks at some of the pros and cons of having homes in both the city and country, and routinely commuting back and forth. The article refers to this as ‘split living’, identifying the trend in a nice soundbite. Apart from the increased mortgage and maintenance cost, some of the biggest cons seem to be accidentally leaving your favourite jacket at the other place. A nice problem to have, perhaps?

House and unit values widening

Perhaps symbolic of this trend, Core Logic reports that the gap between the house and unit market is ever widening, with people intent on owning their own house in the suburbs reaching new heights in January. It seems that the ultimate game here is lifestyle. If they can’t move from the cities, then they’ll at least own a house in the city! This intensity towards owning a block of land is reflected in a recent land release in Canberra, as reported by the ABC. 71 blocks released for development attracted over 8700 registrations.

The SMH sympathises with this in this article, which shows how young families and first homebuyers are buying run down homes just to get into the market, but still paying top dollar even in areas with a dearth of infrastructure, as Austral is reported to have, in the South West. The ABC reports that the suburb is missing fundamental infrastructure like schools, drainage, public transport and more, but that the area is still predicted to grow by a third in the next 20 years.

At the other end of the neighbourhood spectrum, the world’s coolest neighbourhood to live in, according to Time out was won this year by Nørrebro, Copenhagen. The very subjective survey includes neighbourhoods from a who’s-who of international cities like New York, London, Seoul, Oslo, Hong Kong and many more. Local top rankers included Richmond (Vic – in 10th place), and Surry Hills (19th place).

Previous high ranking Australian neighbourhoods include Marrickville in Sydney (10th in 2020) and Yarraville (5th in 2020) in Melbourne. Yarraville’s neighbouring suburb gets a good analysis here.

Marrickville, bastion of coolness?