PropertyBuzz, your daily dose of property news.
All aboard Sydney’s Metro Price Rise train; Stamp duty relief extended in WA; and are construction costs finally on the decline. Who knows?
Welcome to Property Buzz. I’m Phil Tarrant, your host today. It’s Friday the 13th of October and here we go.
Proximity to a Metro line significantly increases property prices, according to a research report by CBRE and PropTrack. Suburbs along Sydney’s Metro line saw a 49% increase in capital value over the last decade. You would think that, wouldn’t you, people? The report highlighted stark contrasts, such as Castle Hill’s 72% capital growth compared to the neighbouring non-Metro suburb, Borkham Hills. I used to knock around there as a youth, only 49% growth. Similarly, Crow’s Nest saw a 79% increase in property prices since 2013, compared to Cammeray’s, which is just next door, 62%. This is what they call a metrification and it’s happening in Sydney. It’s also led to high population growth in Metro line suburbs. Improved public transport options are expected to drive the living experience in Sydney, with 49% of new dwellings built within 1km of the train station. The way we’re going to live moving forward has changed forever in Sydney. The potential for development in Metro-linked suburbs, the shorter commute times and appeal to younger generations are key factors which are driving this trend as people get in close to the Metro. CBRE predicts a rise in apartment supply in these regions, with 11,500 apartments expected to be constructed in 2027.
In other news, we’re going across the other side of the nation from Sydney. In Western Australia, the government has extended the off-the-plan transfer duty concession to include apartments under construction. It’s costing the government around $13.9 million. A lot of detail here, you’re going to have to tune into it. There’s got some good stories out around it, but buyers can receive a transfer duty concession, but the 75% of the concession of the off-the-plan purchase, which is capped at $50,000, with several tiers available based on the property prices, it fluctuates depending on what you pay. The reduced fees are available for purchases from the 31st of October 2023, just past the 30 June 2025, and that’s potentially going to save buyers significant amounts on transfer duty. The government, it’s also investing $15.45 million in 15 infill sites that support the construction of 15,000 new apartments. This is all part of a broader $80 million infrastructure development fund. Again, a lot of details. I’m giving you some headlines here so you know what’s going on.
Finally, it’s important stuff. CoreLogic’s research shows the growth rate of construction costs is starting to level out with a 0.5% increase in the September quarter, which is the smallest since 2019. So that’s before the pandemic started. The Cordell Construction Cost Index, that all sounds very official. This estimates the cost of building a standard three-bedroom home. It indicates this is the fourth consecutive slowdown in quarterly growth for residential construction. There’s going to come good news to most people trying to build a property or even get a tradesperson to build it for them. Victoria saw the largest cost deceleration across states and territories, while Queensland experienced the increased rate of growth due to its strong internal migration trends. So more people moving up there from places like New South Wales. CoreLogic suggests that the future construction cost hikes will be driven by labour costs, not materials, so people rather than the stuff you’re using, and that reduction in new dwelling approvals could lead to a greater petition and competition for new jobs. Again, it’s all about supply and demand. We need to stimulate building in Australia. It’s absolutely critical for affordability. That’s it for me for Property Buzz. We’ll see you again next time for your Daily Dose.