Sales of Sydney’s luxury homes on the rise
Working from home is particularly tricky if you are an Olympic athlete. For Lea Yanitsas, a 31-year-old Sydney resident and member of Australia’s women’s water polo team, the city’s coronavirus lockdown in March meant much more than closing the local swimming baths.
With the Olympics postponed and a packed foreign touring schedule scrapped, she found herself crammed into a small house in the southern suburb of Pagewood with her husband Andrew and two-year-old son.
“When the pandemic hit we had time to think about the future,” says Andrew, head of physical education at a local private school. “It was clear that the home wasn’t big enough.”
In May, they found a four-bedroom house in Malabar, a nearby coastal suburb. Mindful of competition from other buyers, they agreed a price of A$2.875m with the seller, three days before the auction — a popular sales method in Sydney.
Crowded homeworking situations and the prospect of further lockdowns are adding urgency to proposed home moves. While most of the market is still reeling from the effects of the pandemic, sales of the city’s most expensive homes have grown sharply.
In the three months to June, there were 359 sales above A$3m, according to Knight Frank, 42 per cent more than in the same period in 2019.
“The strongest growth [in sales] is in properties valued above A$7m, most being trophy properties in Sydney’s exclusive suburbs,” says Michelle Ciesielski, head of residential research for Knight Frank in Sydney. Between July 1 and September 28, 28 sales exchanged above A$10m, up from 16 in the same period last year.
On September 26, a home in Vaucluse, in the city’s popular eastern suburbs, sold for A$24.6m, A$10.6m higher than its reserve price. This made it Australia’s most expensive home ever sold at auction.
Such gains are in sharp contrast with Sydney’s prime market as a whole. The city’s top 25 per cent of homes by value — with an average price of roughly A$1.9m — have fallen 3 per cent in the past three months, according to CoreLogic, the financial services company.
Across all price brackets, there were 5,883 property sales recorded in August, 22 per cent fewer than in August 2019.
Estate agents blame the withdrawal of mortgage credit by lenders wary
of a looming downturn. In May, Westpac, Australia’s second-biggest bank, dropped its maximum loan to value ratio for most self-employed customers from 95 per cent to 80 per cent. In tourism-dependent locations, including many across Queensland, it capped the ratio at 70 per cent.
The same month, Commonwealth Bank, Australia’s biggest mortgage lender, forecast a 10 per cent slide in national house prices, since revised to 6 per cent. “Meeting the lending criteria to obtain finance is generally becoming a hurdle,” says Ciesielski.
Buyers at the market’s top end, the majority of whom have small mortgages or buy entirely in cash, are untouched by such disadvantages.
One area wealthy buyers have been looking at is Mosman, perhaps the most desirable of Sydney’s north-shore neighbourhoods, which occupy the coastal areas just north of the city’s famed harbour and bridge.
Many of the finest waterfront properties, priced between A$15m and A$30m, cluster around the Spit — home to the Middle Harbour Yacht Club — and Beauty Point, a bulb of land sticking out north-west into the bay.
Nearby, the area between Hopetoun Avenue, Burran Avenue and Awaba Street has long been popular with buyers in China, where it is marketed by enthusiastic estate agents as Sydney’s “Golden Triangle”.
Smaller budgets will favour Balmoral Beach, which includes a popular promenade scattered with cafés and restaurants, and Balmoral Slopes, a steep east-facing hill. The latter connects the sea to Mosman village, the area’s commercial hub, containing smaller Federation-era homes (dating from the turn of the 20th century), bars, restaurants and the Allan Border Oval cricket ground.
Nationwide restrictions introduced in March to fight the spread of Covid-19 — the closure of Australia’s borders to non-residents, social-distancing rules and the shutdown of “non-essential services” such as coffee shops and pubs — also meant strict conditions for the housing market.
Aside from the hand sanitiser and rubber gloves, agents had to organise appointment-only viewings, replacing Sydney’s tradition of open-house events — beloved of those keen to snoop around homes they would never be able to afford.
Some sellers, wary of leaving their homes languishing unsold on property websites, started asking estate agents to advertise their homes “off-market”. It was a good time for buying agents, who could deliver lists of committed buyers.
“Suddenly sales agents are calling us all the time,” says Kath Pearson, a buying agent specialising in Mosman homes above A$8m. “It was my busiest April and May on record.” Since April, she has sold twice the number of homes that she did in the same period last year, and has taken on three new staff members to help cope with the surge.
Andrew Yanitsas thinks his family managed to pick up their new home for about 5 per cent cheaper than it would have been a year ago. Moving in the middle of a pandemic, however, has had its challenges.
Having first bought their new home, they negotiated a 16-week settlement period to give them time to sell the old one. In fact, it sold in a few weeks and the family had to decamp quickly to a friend’s flat in nearby Hillsdale. When they finally got the keys to their house last Monday, the family had been living three-to-a-room for six weeks.
“It keeps you grounded,” Yanitsas says, philosophically.
Properties for sale in Sydney
Waterfront home, Vaucluse, A$55m
A grand six-bedroom home with a private jetty and deepwater mooring. It includes a billiards room with cocktail bar, a rumpus room, a wine cellar and a gym. The property is close to Nielsen Park. Available through Christie’s International Real Estate.
Apartment, Mosman, A$1m (guide)
A two-bedroom, two-bathroom apartment measuring 97 sq m, with a lift and a terrace connected by bi-folding doors to the main internal living space. The home is very close to “Mosman Village”. Available through Century 21.
Family house, Mosman, A$12m
A five-bedroom, 670 sq m house arranged over four floors with a pool, an outdoor kitchen and large garden. The home has views over Middle Harbour to North Sydney and Chatswood skylines. Available through Knight Frank.
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