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Byron Bay’s property market boomed in the early years of the pandemic but has since come off the boil, wiping about $455,000 from the region’s median home value.
But there are signs that prices in the popular holiday region could now be stabilising after a turbulent few years for the market.
Median home values in the Byron Bay Shire Council area have dropped about 25 per cent from their market peak, but now look to be stabilising. Credit: Elise Derwin
Prices in the local government area – which also covers the likes of Brunswick Heads, Suffolk Park, Ocean Shores and Broken Head – soared 77.3 per cent from March 2020 to their peak in April 2022, CoreLogic data shows, as remote workers flocked to the seaside region.
But once interest rates started to rise and workers were recalled to the office, values slipped, and they have fallen 24.8 per cent from their peak, sitting at a median of about $1.38 million in November.
That is still well above pre-pandemic levels though, said CoreLogic research director Tim Lawless, who noted values were 33.4 per cent higher than they were in March 2020.
“In dollar terms, that … equates to about a $345,000 increase, a net increase in accounting for that upswing, and then the downturn and then a very subtle level of growth for the last couple of months,” said Lawless.
While values have had a sizeable drop from their peak, Lawless said affordability would continue to be a challenge for the region, and could limit further price growth.
“I think affordability is still going to be a hurdle to Byron housing prices rising substantially over the coming year,” he said.
“There’s always going to be a level of demand to buy into really high-profile lifestyle markets like Byron Bay… for now, what I’d expect from Byron is probably a stabilisation in the market.”
Dwelling values were virtually flat over the three months to November, lifting 0.1 per cent, amid lower listing levels, as the volume of homes for sale was down 9.3 per cent year-on-year.
But vendors were still having to slash price expectations to sell. The median vendor discount on houses that sold in spring was 8.6 per cent, down from 9.7 per cent the previous year, but the discount on apartments increased to 11.3 per cent, up from 7.4 per cent.
Lawless did not expect to see a significant level of capital gain return to the marketplace until interest rates started to come down.
James Duigan, a personal trainer to stars such as Chris Hemsworth, recently relisted his luxurious Byron hinterland home after it passed in for $14.8 million at auction in April.
Duigan said after the property passed in they took it off the market during winter and let a Hollywood friend stay there.
Personal trainer James Duigan has listed his house for sale in the Byron hinterland after a previous campaign last year. Credit: Natalie Grono
“I just feel like [the] stars are aligning. It’s going to be an interesting next couple of years… because so many places got bought and had these incredible houses built on them. So the whole area has transformed, but no one knows it yet,” he said.
Terase Davidson and Bethwyn Richards from The Agency listed the property just outside the Byron Shire for expressions of interest with an initial guide of $13 million to $15 million.
“All the paints, the colours, the furniture, the textiles are custom,” said Davidson of the property. “Every little aspect of it has been really thoughtfully curated and put together.”
The interest has been remarkable, Davidson said, adding that the top end of the market was performing well.
The Newrybar property falls within the neighbouring Ballina Shire, where values are more than 18 per cent lower than their peak price, but have been stabilising recently. Values are still more than 40 per cent higher than they were in early 2020.
Within the same suburb the site of the Harvest restaurant is up for sale. The opportunity to be the landlord of three titles is listed by Noel Nicholson and John Howard from Ray White Rural (Estates and Vineyards).
Fifteen years ago, a couple purchased the properties to help their adult children set up businesses. One son developed the Harvest restaurant, deli and historic bakery, and the other son developed the merchants and retail spaces.
Howard said it was an opportunity to own iconic real estate in a very strategic area of the Byron Bay Hinterland.
“There’s really nothing quite like it in terms of food and beverage and retail opportunities up there,” he said. “The rental return at the moment provides a decent yield … but the potential yield would be much greater moving forward.”
There are another three years of guaranteed rental income, but those amounts were not disclosed. The guide for the lot is $11 million.
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