Our Golden Waterfronts

Illawarra Mercury

Saturday February 2, 2008

ALEX ARNOLD

Location, location, location. It is the real estate mantra and it certainly holds true in the Illawarra. While the bubble burst in most areas of the market in 2003, waterfront properties have continued to attract high prices. Retirees, cashed-up Sydneysiders looking for a holiday home and nervous investors pulling money from the stock market are just some of the people driving the demand for the region's waterfront properties. ALEX ARNOLD dips his toe into the market.

IF demand for waterfront properties defines a city, then the Illawarra is in the big league.

Coastal properties within the region are seemingly immune to the uncertainty that exists in other sections of the property market.

The latest IRIS Property Report stated that in the year to September 2007 the median value of a house in the Illawarra remained stable, but statistics show the decline in value of houses in Wollongong's southern suburbs was balanced out by the increase in coastal areas of the north.

In the year to September the median house price between Austinmer to Thirroul increased by 2.7 per cent to $547,000.

At the same time the median house price in the Unanderra to Mt Kembla area fell by 5 per cent from $360,000 to $342,000.

Illawarra land valuer Terry Wetherall said in the Illawarra a divide was forming that was no different to that of western Sydney and the eastern suburbs.

In Wollongong the line between the two could be said to run down the middle of Corrimal Street.

Mr Wetherall said the "sea change" lifestyle, as well as superannuation investment, had helped push the values of waterfront properties skyward in the past 10 years.

"I also think that 10 years ago people weren't as interested in property," Mr Wetherall said.

Property values across the Illawarra have doubled in the past 10 years, but in suburbs such as Wombarra the median house price tripled between 1999 and 2004.

Simon Beaufils of Ray White Helensburgh said prices of waterfront and beachfront properties north of Bulli suffered a downturn in 2005, but in general median prices were now back to where they were during the property boom.

"There is confidence in the marketplace," Mr Beaufils said.

"People know they can hold on to waterfront properties for three or four years and reap good rewards.

"There is still a limited supply, properties close to the water are rare."

On February 16 Mr Beaufils will auction two lots of beachfront property in Tasman Parade, Thirroul.

Mr Beaufils said 10 years ago the sale would have expected to raise about $800,000. Today expectations are around $3 million.

Illawarra Real Estate Institute chair Leigh Stewart said the demand for waterfront properties in Illawarra was no different to the demand for waterfront properties globally.

Mr Stewart said a limited supply provided a buffer between waterfront properties and the rest of the property market.

He said buyers of waterfront properties in Wollongong were a mix of investors from the inner suburbs of Sydney, but also baby boomers from within the Illawarra looking to retire within walking distance of the harbour and restaurants.

Stelios Anastasiou who recently purchased a waterfront property at Wombarra as a weekend escape from his home in Sydney's eastern suburbs said it was the landscape, views and relatively untouched environment that attracted him to the area.

"We'd looked around Palm Beach, Avalon and Church Point but the prices were exorbitant," Mr Anastasiou said.

For the time being, analysts predict the market for waterfront properties will remain strong as investors seek refuge from a volatile sharemarket.

But Mr Wetherall said there was one factor that may yet see people head from the coast back to the hills - climate change.

"That may yet prove to be an interesting factor," Mr Wetherall said.

PROPERTY IN THE ILLAWARRA

Median prices of properties in some of the region's coastal suburbs in 2007, compared with those of 1998.

1998 2007

Austinmer $300,000 $562,000

North Wollongong $175,000 $479,000

Windang $155,000 $370,000

Shell Cove $100,000 $450,000

Kiama $200,000 $490,000