There’s little doubt that Sydney’s lower north shore delivers the magic ingredients that together make-up the core of a great location being; facilities, transport and easy access to open space.
These qualities have always appealed to local home buyers and they are equally seductive as some areas are now redeveloped with medium density, mainly high-end apartments and townhouses in boutique buildings.
The trend is creating added value for existing owners, both apartments and detached homes where a joint sale will help to deliver greatest site value.
Three recent development site opportunities spread across this popular area clearly demonstrate this aligned to a shift in demand for new and larger apartments and contemporary townhouses.
The sites are well worth examining as they indicate a strong trend that is responding to a changing demographic in this mature market. Much of the demand is also being driven by the current resurgence of the North Sydney CBD headed by the pending moves of the NBN, US Consulate, Channel Nine and the new Metro station.
Evolving Demand is Life-stage Driven
Demand across the area is evolving and is mainly life stage driven which, two age brackets demonstrate this.
While the areas total population increased by approximately 5,400 between 2011 and 2016. In contrast two brackets did show a measured decrease.
Between the 2011 and 2016 census the population aged between 40-49 and 65-74 were the only age brackets to show strong decrease in numbers, focused between 20-29, although there was also a very small drop in the age bracket 60-64.
Those leaving the area were then further concentrated in the age bracket 35-44.
In Australia, the average age for child birth is 28-30 and it’s reasonable to conclude that once kids reach school age, their parents might move from the area, possibly moving from an apartment to larger detached homes in more affordable parts of Sydney.
These population factors are notable as they directly influence a trend that is current across Sydney and also evident on the lower north shore which, three recent transactions demonstrate.
The three sites, that each show how the area is changing are; 85 Kurraba Road, Neutral Bay, 11-13 Waverton Avenue, Waverton and 4 Currawang Ave, Cammeray.
The Kurraba Road and Currawang Ave sites are both existing older apartment buildings offered in one line, which along with detached houses, is an increasingly popular way for vendors to combine their properties into a single site sale.
Looking at each of the three sites, there’s clearly reasons why these sites are attracting high values, even at a time when the apartment market has lost some of its shine of recent years. Each of the three sites has individual merit in an area where unimproved greenfield sites are non-existent.
We’ve already looked at the first location, 85 Kurraba Road, Neutral Bay, a classic example of a property transaction that clearly defines the value and appeal of the area.
However, like the Waverton and Cammeray locations this sale realised over $20million as a luxury Neutral Bay development site on behalf of the strata owners group.
Waverton Ave, is another 1424sqm site amalgamation of 2 existing homes with a R3 Medium Density Zone and height limit of 8.5m with potential for large up market townhouses. The key attributes of the site include great location close Waverton Village and Station, the site has price expectations over $9m.
The appeal of a townhouse development here would be boosted by easy access to multiple North Shore Private and Public Schools, North Sydney CBD, and Waverton Park. The value of being situated between the current rail station at Waverton and the new Sydney Metro Station and Victoria Cross (North Sydney) is enhanced by quick access to the Pacific Highway.
Currawang Ave is also a sale of an existing apartment building circa 1965, in this case 4 units and the 893sqm site benefits from existing use rights, with a high limit of 8.5m. Planning for the site is under North Sydney Council Zoning R2 – Low Density Residential.
However, its appeal to buyers is lifestyle driven, including right-size or size-in-place buyers, appeal that’s assured by a great location near Trunks Park and Mortlock Reserve, plus easy access to Miller Street and the nearby Cammeray Village shops and its location mid-way between Northbridge and Cammeray golf clubs.
As Markets Mature the Dynamics Shift
In a mature market like the North Shore the scarcity of sites delivers home owners the benefits of amalgamation.
The maturity of this market is well beyond what might in other locations, be termed gentrification.
Gentrification more generally implies a major shift in the use and quality of properties, here what we are looking at is partial re-shaping of the market defined by changing demographics.
Populations are always defined on the basis of geographic boundaries and they are constantly involved in the process of redistributing of residents from one geographic suburb to another.
Australia is among the most mobile societies in the world with 15% of the population changing their address within Australia in the year prior to the 2016 Census, and 39% changing their address in the five years prior to the Census. Across the globe, on average 7.9% of people move.
This degree of mobility directly underpins the demand for sites like the three above, as areas evolve to meet shifts in lifestyle and age profiles.