The bucolic Hunter Region, with its undulating beaches and renowned vineyards, has long attracted retirees and holiday-makers in search of the good life. But in recent years, interest in the area – also referred to as the Hunter Valley – has skyrocketed, fuelled by a decade-long investment boom in the main city of Newcastle and by deteriorating quality of life in Sydney to the south. As professionals and young families flock to the area, canny property investors are sensing an opportunity.
Strong, consistent demand from both owner-occupiers and renters is already pushing the Hunter market higher – a marked contrast with nearby Greater Sydney, where values are falling. “The residential market right across the Hunter Valley was very strong in the past 12 months,” says Wayne Stewart, the Real Estate Institute of NSW’s chapter chair for Newcastle. “We’ve seen growth in all the major areas.”
In addition to Newcastle, these areas include the towns of Maitland, Muswellbrook and Cessnock plus seaside enclaves such as Port Stephens and Forster. Across the Hunter Region, the median house price grew a solid 2.9 per cent in 2018, according to Domain. The Hunter Region’s unit market performed even better, registering growth of 3.8 per cent in 2018. And rental yields are solid, at 4.22 per cent for houses and 4.21 per cent for units – a full percentage point higher than Sydney’s.
Yet experts say cost-of-living pressures in the Hunter remain less than they are in Greater Sydney. The region’s median house price (currently $450,000) bears that out. “Even if the median grows at the same rate – or even faster – in the years ahead, it will still be more affordable to live in the Hunter than in much of Sydney,” says Domain economist Trent Wiltshire. “And affordability fuels population growth.”
Increasingly, younger Australians are paying attention to what the Hunter offers. Says Stewart: “We’ve seen a strong increase in demand from young families, which reflects the feeling that the Hunter in 2019 is an area where people can build their lives.” He adds: “Many of those young families will be renting, at least in the first instance” – more good news for investors.
Meanwhile, ongoing infrastructure investment in the region bodes well for the future. “Newcastle has been one of Australia’s most consistent property markets over the past decade precisely because of that major investment,” says Simon Pressley, Propertyology’s head of property market research and three-time Real Estate Institute of Australia Buyer’s Agent of the Year.
Industry leaders reckon the recent diversification of the region’s economy will be its greatest asset moving forward. “A lot of people think that the Hunter Valley is only famous for coal, but today our biggest employer is health services and our second biggest employer is education services,” says Stewart. “That diverse employment base will help insulate the region from the sort of shocks you might see in an area which solely relies on mining.”
All this is drawing greater and greater numbers of prospective buyers from Sydney, where the recent combination of runaway property-price increases and rapidly worsening congestion has led many residents to seek a better lifestyle.
Says Stewart, who is also the director of Century 21 Novocastrian: “Yesterday I met with a Sydney couple who told me, ‘We live an hour out of the city, in the western suburbs, and we spend half of each day on the road in traffic. By the time we get home in the evening, we’re screaming at each other. We both feel we can find jobs easily in the Hunter Valley – and we’ll get our lives back’. And they’re not the only ones who feel that way.”
If you are interested in investing in the Hunter region we currently have several properties available in locations including Thornton and Wickham.