As 2009 winds down and auctions begin to dwindle, the competitive struggle for an affordable home is no more evident than in Sydney’s inner west, which is a hot spot for first-home hopefuls.
It’s an area where the median house price rose 5.6 per cent to a record $760,000 in the September quarter.
The Australian Bureau of Statistics has revealed that first-home buyers obtained a record 26 per cent of lending in the same period.
Though the median house price for the inner west is well above the overall Sydney average of $569,000, it is certainly closer to the first-home buyer budget than homes in the east or the lower north shore.
Proximity to the city, transport and lifestyle are key reasons first-home buyers flock to the inner west and, according to an economist for Australian Property Monitors, Matthew Bell, they are willing to pay for it.
“People are willing to pay more to live close to the city and this includes first-home buyers,” he says. “The inner west is close to transport, shops, employment opportunities and … you’re paying more for a better product that’s close to amenities and a lifestyle that appeals to that age bracket.”
Some first-home buyers may be feeling the pressure to secure a property before the First Home Owner Grant drops from $10,500 to $7000.
And if you’re after a “bargain” – a liveable house below the median price with good prospects for capital growth – they still can be found if you look hard enough.
“If you can afford a home in a growth-predicted area and have stable individual or dual incomes then I can’t see any negatives,” Bell says. “Buying the cheapest house on the market doesn’t result in the best
growth returns.”
Bell’s best bets include Ashfield, where the median price has fallen 7 per cent in the past year; Erskineville, where the median price is still 12 per cent down on where it was a year ago; and Leichhardt, where the median price has grown a mere 4 per cent in the past six months, underperforming Sydney as a whole.
Leichhardt
Despite being on a busy road, this Federation semi at 101 Balmain Road is a winner. Double-glazed windows on the front two bedrooms mean the clamour of traffic can barely be heard.
Built in the 1920s on 146 sq m, the property was renovated a year ago by its vendors to include floating polished timber floorboards, a CaesarStone bathroom, entertainment deck and a combined kitchen and dining area.
The kitchen, with apple-green splashback and Bosch stainless steel appliances and integrated laundry, is the centrepiece of the house. There’s even a glimpse of the Harbour Bridge if you strain your neck.
“This is a home that you can move right in to and not have to touch,” says the agent, Mara Pitton from Raine & Horne Montano.
However, there’s still potential to add value, with the possibility for a second storey (subject to council approval).
It doesn’t have a car space but Norton Street restaurants, transport and parks are a short walk away. More than $650,000 is expected at the December 5 auction. It last traded in December 2007 for $528,000. Phone Pitton on 0414 448 565.
Erskineville
Built in the 1900s, this park-side semi at 35 Knight Street has been popular at inspection because of its location and low maintenance.
It sits on 83 sq m and has been revamped but not renovated by its previous owners; the interiors are in good condition. The two bedrooms are at the front of the property with a combined lounge and dining area opening on to a galley kitchen and pantry-cum-bathroom. It’s reminiscent of a tiny overseas WC with only a shower and sink (the toilet sits on the other side of the wall). It’s not unusable but not entirely comfortable, either.
An internal laundry at the back of the house opens on to a small bricked courtyard that gets the morning sun. Three small parks are nearby, which is a big plus, says an agent from Ray White Inner West, Paul Clarke. “It’s a perfect spot for first-home buyers who love the local lifestyle,” he says.
There is no potential to expand the property but reconfigurations of the interior could lead to a better use of space. It is within walking distance of several train stations, buses, shops and nightlife. The price guide before its December 3 auction is $550,000-plus, which is well below the suburb’s median house price. It last traded in April 2006 for $430,000. Inspect on Saturday, noon-12.45pm; Wednesday, 5-5.30pm. Phone Clarke on 0411 100 378.
Ashfield
This freestanding double-brick Federation cottage on 305 sq m at 11 Thomas Street isn’t glamorous but for an agent with PRDnationwide Ashfield, John Aslanidis, it’s a bargain. “It’s a fantastic investment, has a lot of potential and all it needs are some personal touches,” he says.
Well located in the suburb, the home has three bedrooms, a recently renovated bathroom and new kitchen. The large bedrooms are at the front of the property, with the back opening out to a bathroom and combined kitchen, dining and living area with lino floors.
An extension was added to the home in the 1930s to incorporate an interior laundry and rumpus room. Aslanidis expects about his price guide of $630,000-plus at the December 5 auction. It’s higher than the median house price but comprises a lock-up garage with side-lane access, a feature missing from most houses in the area, freshly polished cypress pine timber floorboards, a modest kitchen with electric oven and grassy front and backyards.
The property is on a bustling, tree-lined street and is within walking distance of buses and trains, shops, schools and the local pool. There is potential to expand and improve the property by building upward. The house has been in the same family since the 1960s and the last traded figure is unavailable. Inspection is by appointment. Phone Aslanidis on 0407 105 151.
THE AREA’S BEST BUYS
Homebush: $605,000
Leichhardt: $680,000
Abbotsford: $760,000
Erskineville: $625,000
Summer Hill: $710,000
Ashfield: $625,000
Strathfield South: $612,000
Marrickville: $607,000
Enmore: $650,000
Petersham: $705,000
Determined by median price growth prospects and affordability.
Source: APM
FAMILIARITY BRINGS A COMPETITIVE EDGE
When first-home buyers Amy Robinson and boyfriend Raymond Anvell decided to move out of home, the last place they expected to buy was around the corner from their families.
But 12 months after their search for a property in the inner west began,
Robinson believes it was her familiarity with her home suburb of Tempe that gave her an edge. “I didn’t have to do much research about Tempe; we know where all the great restaurants, shops and transport are,” she explains.
The young couple are certain the two-bedroom, one-bathroom Federation semi they bought in September through Maria Hodgson of Raine & Horne Marrickville was a bargain. Not only did they sign contracts the day before the first-home buyer grant was halved but they avoided paying stamp duty on the double-brick home because the selling price sat directly on the $500,000 stamp duty-free threshold.
“I don’t think you could find a luckier couple in Sydney,” Hodgson says. “You can’t buy anything liveable or this close to the city and transport for $500,000 or less at the moment.”
After years of saving money while living at home with their families, Robinson, 22, and Anvell, 23, were keen to have a house to call their own. Their budget ranged to just more than $500,000, which led them to many apartment inspections they were unhappy with. On their first inspection of 27 Fanning Street, the couple believed the 182 sq m property was too small for them. However, after inspections on comparable properties, they realised what a steal it was.
“It was a bargain compared with other houses on the market in that area,” Robinson says.
Despite recent flooding problems in Tempe, the couple’s new house has not been affected. Aircraft noise has similarly not been an issue. “The area has definitely improved,” she says.