Home to 28,5000 people, there’s always plenty of property action in magical Mosman, Sydney NSW, and despite prolonged, pandemic-induced lockdowns we saw terrific sales volume across 2021. There were 994 reported transactions between January 1 and December 1 this year compared to 837 over the same period in 2020.
Price growth was equally impressive with the median house price up 35 per cent to $4.7 million in the 12 months to August 2021. The highest reported sale price for a Mosman house this year was $21.55 million for a Coronation Avenue residence set above Balmoral Beach, and there were another 36, $10-million-plus sales recorded.
We saw more off-market sales this year as vendors decided to test the market rather than launch a full marketing campaign. Some highly-covetable homes were quickly snapped up with credit due to some of the area’s most switched-on buyers’ agents. Australian buyers are following in the footsteps of their American contemporaries who have cottoned on to the benefits of using a buyers’ agent or advocate to get exposure to off-market properties and to capitalise on the buyers’ agents’ market knowledge.
It’s good news for our vendors because buyers’ agents bring highly qualified and motivated buyers to the property and help guide them through the process, leaving less room for false starts.
Buying sight unseen
With Covid lockdowns and border closures Australia-wide, many buyers had to make the hard decision between putting their property goals on hold or buying sight unseen.
Some buyers engaged a buyers’ agent to view properties on their behalf and/or sent family members to look at property. The virtual tour also proved invaluable this year, both pre-recorded and using the likes of Facetime to show clients through homes. We had an unprecedented number of $5 million-plus sales completed by buyers who couldn’t physically inspect their new home.
Technology really helped here, including online auctions. We were surprised and delighted by the success of our online auctions and received positive feedback from participants, some of whom preferred the online format to an in-person event. Being able to bid from the privacy of their own home was certainly a factor for some buyers and we will continue to discuss the option for online auction capability for future campaigns post-Covid.
2021 has forced us to improve our processes and improve our online profile to everyone’s benefit and we are now able to provide more information than ever before on a property via digital channels.
Sea and tree changers
The exodus from Sydney continued this year as people became more comfortable with working remotely. Our vendors told us they were keen to “uncomplicate their lives” and a move out of the city was key to that equation.
Some tree-changers made a clean break from Sydney, others asked us for help to find them a city pad they could return to for work or to reconnect with family and friends. Mosman has a good selection of one and two-bedroom apartments that work well for this demographic, with a handful still on offer leading into 2022.
Two regions that proved especially popular for sea and tree-changers in 2021 were the Southern Highlands and in and around Byron Bay. Queensland has also been a magnet for Mosman-based buyers.
One of the ongoing effects of the Covid pandemic is the sharp hike in the number of expats choosing to return to Australia.
Our office manages lots of houses for people living in Hong Kong and Singapore and many of these owners opted to return home this year and move back into their properties, sending tenants back into the market. This trend, combined with an across-the-board increase in the appetite for houses over apartments, has led to a serious shortage of houses to lease out.
This was a year where everyone wanted more space - preferably their own space rather than common spaces and that has translated into increased rental returns for houses. Unfortunately, the massive growth we saw for house rents was not mirrored in the apartment market. It has really been a two-speed market, with apartments somewhat lacklustre, so apartments are probably a little bit undervalued at the moment.
The Mosman market has been generally too bullish for investors, and in any case there was very little investor activity across the board in 2021 as prices continued to soar.
We did experience quite a lot of our rent roll being sold this year as landlords cashed in on their investment properties and achieved top sale prices. With apartment rental yields stagnant, many investors chose to secure a premium for their property rather than wait out the market dip.
We have seen a renovation boom in Mosman this year as money previously directed towards overseas holidays has been shifted into improving the family home. People have been spending so much time at home they’re more attuned than usual to their home’s shortcomings and they’ve had the capacity to plan and execute renovations. With so many homeowners renovating it has been hard to get architects and builders, and trade prices have shot northwards.
This in turn means buyers had a strong preference for renovated dwellings this year, knowing that a renovation would prove tricky and expensive in the current environment. We have seen buyers paying a massive premium for beautifully-renovated homes across Mosman and the surrounding suburbs.
The Mosman market is still short of stock when it comes to the kind of luxury apartments coveted by cashed-up downsizers. It has been an issue in Mosman for some time and, with Covid slowing down progress on new developments, that lack of availability was even more keenly felt.
Downsizers tell us they are looking for large residences with 200-square-metres of internal accommodation and an appealing outlook, and they are happy to pay between $7 million and $10 million for the right property.
It looks like the massive undersupply in this sector of the market is set to continue into 2022 which leaves older residents stuck in big houses better suited to family buyers.
There is no crystal ball to help us predict how the market will fare in the new year, but there are signs of a slow-down in the housing market and the potential for apartments to play a little catch-up.
Our agents are available to provide appraisals over the holiday period for anyone keen to list in the coming months and also for those interested in the current value of their home in the wake of the 2021 property boom.
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