Fiona Killman, Real Estate Reporter
First published 28 Jun 2023, 10:39am
The newly proposed flight paths for planes at Western Sydney Airport is expected to have a significant impact on property values in the area.
Mixed opinions have emerged on the potential impacts to property values located in the proposed flight path of the Western Sydney Airport.
The airport’s proposed flight paths for the 24-hour facility were released on Tuesday with residents in suburbs of Mount Druitt, Penrith, Prospect, Orchard Hills, Bankstown, Windsor and Richmond likely to be the most impacted.
People living in the Blue Mountains will also be impacted, however to a lesser degree.
A render of what the finished passenger terminal for the new Western Sydney Airport at Badgerys Creek will look like when finished. Picture: Supplied
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Experts have had mixed opinions on the impacts to property values.
Property investment advisor and head of analysis at Hello Haus Sam Powell said it would be a “fair assumption” to say property values will be impacted in suburbs under the flight path.
“Historically they have underperformed surrounding areas for obvious reasons, noise is a massive issue,” he said.
“The methodology I would use is to look at the sale prices of similar properties of similar land size and improvements under a flight path and those not.
“There is a clear sign that they sell for a discount due to the impacts and lower levels of desirability/owner occupier appeal.”
Mr Powell said building new homes, with regulations around flight paths, would also be a consideration for buyers.
Preliminary flight paths for Western Sydney Airport have been released. Picture: Supplied by the NSW Government
“It can result in more expensive building materials which is less desirable as well,” he said.
He said initial impacts of the flight paths would come down to the “human psyche” of buyers.
“They are going to be less keen to search for homes in that area,” he said.
“It would be more of a secondary or even third location for them.”
Mr Powell said if Sydney was seeing a declining or neutral market, it could place areas such as Mount Druitt as a “less desirable” and result in price declines.
“Overall the area will increase in value along with the surrounding suburbs due to the (current) supply-demand effects, however they will forever be seen as less desirable, and the prices will reflect that,” he said.
Residents in Penrith will be adversely affected by flight paths from the new airport.
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He pointed to a University of Sydney study that found properties underneath flight paths were three to five per cent less in value than other properties.
“Long term it will become the new norm, people will expect to get a slight discount but it won’t deter people from buying there if it suits their means,” he said.
Mr Powell said while proximity to airports was desirable for travel, people should think about their “opportunity cost”.
“If you had a million bucks to spend, where would you spend it? Try not to spend it under a flight path is my point,” he said.
“You might not get that fully detached house that you are looking for but you might get a nice, large semi that’s not under the flight path. You would get better capital growth out of that as it doesn’t have those negative factors.”
Vanessa Rader, head of research, Ray White Commercial said the government had done well to minimise impacts of the airport.
Ray White Commercial head of research Vanessa Rader said while there would be noise impacts, the government had done well to limit the impacts with more heavy aircraft movement in the south east where there is less population density and more employment related lands.
“In terms of value there are mixed results, this region has gone through an outstanding period of housing value growth,” she said.
She said the growth was spurred by the investment into infrastructure.
“The land value appreciation of this area around the aerotropolis historically has been sound and given the current mismatch in supply and demand across Sydney price growth going forward will continue,” she said.
“Buyers may make consideration of the flight path when purchasing but the location advantages, transport, schools, employment opportunities are all considerations, which some may say have improved with the development of the airport.
Flight paths are unlikely to be the only consideration of most home buyers.
“As for commercial investment, we have seen huge attraction to the area over the past few years. Western Sydney is expected to be the recipient of the bulk of Sydney’s growing population so it makes sense that investment of all types would be centred in this region.”
Ms Rader said there was an initial reluctance from buyers in Sydney’s inner west regions when the third runway opened at Sydney Airport in the mid 1990s.
“We have seen these markets enjoy robust levels of capital value growth since this time at a similar rate to those across broader Sydney,” she said.
“The fundamentals of location remain paramount and these suburbs offer great access to the CBD and once upon a time were quite affordable but alas now along with the rest of Sydney prices have grown.
Ray White principal Peter Diamantidis.
She said there was “still consultation around the proposed routes” of the Western Sydney Airport.
“The advantage of proximity to the greatest infrastructure project for Sydney improving access, transport, employment opportunities may counteract some of these impacts,” she said,
“Over time we have seen the impacts lessen like the inner west example however given the current housing supply situation for Sydney this will also ease uncertainties around values for many homeowners.”
Local agent Peter Diamantidis, principal of Ray White Diamantidis Group, saying his phone had been running hot since the flight paths were announced.
“My message has been ‘it’s not going to affect us’,” he said.
“If anything, I think house values will go up. People will be close to a national airport running 24 hours a day. Why would it decrease?”
He said the Western Sydney market had been booming since news of the Sydney Metro West and Western Sydney Airport.
“There’s been a huge increase in investors and first home buyers,” he said.
“People haven’t all of a sudden been leaving due to the airport being built.
“What’s the difference in living near a train line or near the highway? I think this will be a positive for the area.”
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Fiona Killman, Real Estate Reporter