New house price data indicates that inner-Sydney suburbs are still amongst the fastest-growing in the country, with one in particular continuing to attract local and international investors.
A suburb on Sydney’s lower north shore has one of the fastest-growing median house prices in Australia, reflecting the upward trajectory currently being reported city-wide.
Kirribilli was ranked the third fastest-growing suburb in New South Wales, according to new figures from CoreLogic RP Data.
The median house price in the suburb was recorded at $3.52 million dollars, resulting in a quarterly growth rate of 32.83 per cent.
Queenscliff achieved the state’s highest result with 33.78 per cent, with other high-performing suburbs including Walkerville in South Australia (34 per cent), Boolarra in Victoria (34.63 per cent) and Larrakeyah in the Northern Territory (31.54 per cent).
The median unit price ($750,000) in Kirribilli actually showed a slight decline over the same period (1.32 per cent), however anecdotal evidence suggests that the demand for unit stock remains high – spurred on by limited supply.
Piers van Hamburg, principal of McGrath Neutral Bay, currently has three listings in Kirribilli.
He explained that there had been a notable reduction in supply over the previous three to six month period.
“[There’s a] lack of stock in Kirribilli at the moment ,” he said.
Mr van Hamburg explained that luxury apartments in particular were incredibly popular with both overseas investors and local owner-occupiers.
“Buyers are placing a lot of emphasis on big views, which Kirribilli offers. In particular we find a lot of overseas buyers, particularly Chinese buyers, specifically want big harbour views with the Opera House and Harbour Bridge.
“The other thing that is always in demand is big luxury apartments for downsizers, with level access, and big views. In particular, coming from the upper north shore moving out of houses and wanting to be closer to the city. There’s always high demand for those properties and never enough supply.”
According to Jo Vadillo, principal of Advocate Property Services, Kirribilli has a particularly high proportion of units to houses for a north shore suburb.
Ms Vadillo has sourced a number of Kirribilli properties for clients, both investors and owner-occupiers, and said that the suburb’s harbour views and proximity to Milsons Point train station was a deciding factor for buyers who are willing to make sacrifices.
“Because it’s so close to Milsons Point train station and they’ve got access to the city and because of its location – you can do everything on foot from Kirribilli – I’m getting people who are perhaps looking at Neutral Bay with a car space who then go ‘let’s see what I can do in terms of Kirribilli’ and maybe sacrifice that,” she explained.
Echoing Mr van Hamburg’s observations, Ms Vadillo advised prospective investors not to expect high yields from apartments in Kirribilli.
“Of late the people I’ve been buying in that area for have all been looking for a good capital growth investment,” she said.
She said that the mixed unit stock in Kirribilli was another reason behind client interest, and would likely assist future capital growth and rental security.
“They don’t mind that it’s older, they actually quite like the eclectic aspects of Kirribilli itself. They like that there’s the quirky and the old and the fantastic and the new, but most of them like the fact that it’s a little bit unique.
“Most of my clients, if they’re looking for a unit, they want that point of difference. Because if the rental market does turn, then your property isn’t another one of say, another 16, who are chasing tenants.”
But investors looking to renovate an older-style apartment should be aware of the luxury-oriented market in Kirribilli.
“$50,000, that’s not a Kirribilli renovation. You need to spend at least $300,000 on a Kirribilli renovation. You need to make sure that you’re doing things that are sympathetic to the era of that property,” she said.