Newcastle Property Market Update 2nd Half of 2020
In Q3 2020, Newcastle recorded a median house price of $815,000, and a median unit price of $610,000. This represents annual (Q3 2019 – Q3 2020) median price growth of 10.9% for houses and of 23.2% for units. Between Q3 2019 – Q3 2020 total sales increased, by 5.6% for houses to 150 sales and by 46.8% for units to 138 sales. Median price growth and increased sales activity suggest real capital growth in the area, in contrast to general COVID-19 predictions. This indicates high market resilience in Newcastle, thus creating an ideal market for real estate transactions.
Average vendor discounts between Q3 2019 and Q3 2020 have marginally widened for both property types, to -2.7% for houses and -4.1% for units. Market conditions in Newcastle continue to favour buyers overall, as sellers are willing to negotiate below their initial listing price. Now is the time to enter the market.
In September 2020, house rental yields in Newcastle were recorded at 3.0%. In the 12 months to Q3 2020, the median house rental price increased to sit at $470 per week, while average days on the market declined by -23.8% (to just 16 days). Overall this suggests Newcastle has remained a highly resilient rental market throughout COVID-19.
4+ bedroom houses have provided investors with +8.3% rental growth annually, with a median rent of $650 per week.
Also in September 2020, Newcastle recorded a low vacancy rate of 1.8%, well below Sydney Metro (3.5%). Vacancy rates in Newcastle also remain well below the Real Estate Institute of Australia’s healthy benchmark of 3.0%, and continuing on a declining trend ,even amidst COVID-19 conditions. This confirms there is still a healthy rental demand, indicating that investors can be confident of a conducive investment environment in Newcastle.