Ray White Upper North Shore

From tennis courts and swimming pools to fresh living room makeovers, some homeowners began renovating with the aim of selling or leasing their property. Topping the state, Mosman families spent up to $82.4 million on renovations and an average of $2.2 million on knock down rebuilds. Investors Resurfacing Unsurprisingly, the Australian Bureau of Statistics recently announced that investor loan commitments had risen 13.3%, the highest since April 2015. Taking advantage of record low interest rates, tenant trends and strong rental yields investors resurfaced in the luxury market in the latter hal cial year. Contrary to reports of the dwindling rental market in Sydney, prestige apartments prospered – those renting for upwards of $3500 per week and beautiful big homes asking $4000+ were rented quickly and easily. Individual suburbs, such as Lane Cove flourished with a five% increase for house rentals. However, average rents for units fell across the board. Lack of space and sunlight became one of the most unattractive characteristics of any property in a post-pandemic market. Renters spoke with their feet. They moved in droves from one-bedroom apartments and average rental prices in North Sydney, Ku-ring-gai, Lane Cove and Hunters Hill dropped by up to 9.5%. Willoughby suffered the steepest decline with rents decreasing by 10.9%. Cinderella Story for Commercial Commercial real estate has its own story to tell. At the peak of the pandemic, rent collections for large retail malls in the Lower North Shore were as low as 30%. As the economy reopened, rent collections bounced back to 70-90% with foot traffic close to pre-pandemic levels. The retail sector nationally is continuing to lose market share to e-commerce (11% of sales in Australia were made online vs 7.2% in the prior year, per the ABS at November 2020; and expected to reach 20% by 2025). But what we are seeing in the Lower North Shore is a concerted effort by the community to shop local. Commercial investors are taking advantage of this opportunity, snapping up retail properties, capitalising on strong rental yields and enjoying reliable returns in the low interest rate environment. An investor recently bought the BP service station in Willoughby for $5 million at a 3.85% yield, and in Neutral Bay a Tabcorp-leased premises, sold for $3.4 million on a 4.69% yield. As we enter the new financial year jumping back into lockdown, what can we predict is next for the Lower North Shore – market 3.0?