Tamworth Property Watch Q4 2013
Demand from local and out-of-town investors balanced the decline in first-home buyer activity that represented less than 15 per cent of the market. These buyers predominantly competed for properties in the sub-$300,000 market (68 per cent of the market). The record low interest rate encouraged investors to chase rental yields in the short term, and capital gain in the medium to long term.
Observing the House Price Point chart to the left, a decline in affordable properties persisted with sales below $300,000 contracting by 18 per cent between the August 2012 half year and the corresponding period in 2013. That said, overall increase in house transactions between $300,000 and $500,000 led to the increase in median house price.
Unit activity was steady, with the August period remaining at the three-year average of 33 transactions per six month period. As observed in the house market, unit transactions in lower price points declined while the number of sales above $200,000 climbed. Toward the bottom end of the market a unit on Carthage Street, East Tamworth sold for $115,000 in May, while toward the top end a townhouse on Rawson Avenue, North Tamworth sold for $392,000 in April.
Investors holding two-bedroom units experienced strong rental yields, equating to approximately seven per cent since April. The yield for a three-bedroom house declined after peaking at 4.9 per cent in April 2013. The decline was related to a rise in prices and a softer demand for rental houses.
The median rent for a two-bedroom unit climbed by 4.5 per cent ($10) between September 2012 and the corresponding period in 2013, closing at $230 per week in September. The median rent for a detached house remained stable over the past three quarters, closing at $300 per week in September.
The graph below identified a strong rise in vacant land activity between the February 2012 half year and the most recent August period. A rise in the median price of a vacant lot strengthened the feasibility for new land subdivisions. Activity increased by 46 per cent in the 12 months to August, signalling strong demand for lifestyle blocks in the $100,000 to $149,999 price point and providing accommodation to the new hospital and university education centre. The median lot price of $123,000 represented a small 12-month increase of 2.5 per cent.
North Tamworth accounted for the majority of vacant lot transactions, accounting for 31 per cent over the August 2013 half year, followed by Calala (19 per cent) and Hillvue (18 per cent). In North Tamworth, the Windmill Hill Estate recorded 13 land transactions, boosting the suburbs performance. Currently on the market are rural residential lots in the Oaklands and Rosewood Estates, with smaller lots in Calalas Lampada Dawn Estate and Westdales Northern Lights Estate.