‘A magical place to live’: Sydney’s most profitable suburbs for home owners

The most profitable locations for home buyers in Sydney have been revealed in new research that shows suburbs desired for their lifestyle and amenities are also a sound investment.

In the northern beaches, 98 per cent of all property resales over the past decade made a capital gain. The area ranks top in Sydney over the 10 years to March, on CoreLogic figures.

It was followed by the Woollahra local government area and the Blue Mountains, each at 97.8 per cent, then the Hawkesbury and Randwick LGAs on 97.7 per cent each.

Lifestyle locations close to greenery or the beach, as well as affluent and amenity rich areas, have proved a contrast to pockets heavy with apartment development where as many as one in five homes sell at a loss.

CoreLogic head of Australian research Eliza Owen said some of the most profitable areas were desirable pockets that buyers would choose for the lifestyle, exclusivity or the access to the waterfront.

“They’re blue chip, very desirable, very close to a lot of amenity and relatively high socio-economic areas, so very little in terms of longer-term headwinds to those markets over time,” she said.

“These are markets that have become increasingly desirable,” she said. “For a sea-change or a tree-change … or very exclusive areas to buy into.”

She said the northern beaches was popular because buyers love being near the water.

“How much importance has been given to the value of having beautiful natural surrounds – that is what we think of around tree-change, sea-change and that leads to the transformation of these areas over time,” she said.

“The fact that they’re attracting high-income owners and that pushes up the value and increases the incidence of profitability.”

She noted that even though home owners were likely to sell for a profit, the size of that profit would likely vary and be lower in the Blue Mountains than the northern beaches.

Areas such as the Blue Mountains and the Hawkesbury that draw buyers looking for a tree-change had been profitable over a long period but had a substantial uplift in value since the pandemic began, she said.

Owning a home for a long time can mitigate the risk of selling at a loss, boosting areas filled with long-held family homes rather than investment properties.

Tracey Mietzke has just sold her home of 10 years, a three-level semi in Manly that she and her husband built.

“We worked with an incredible architect and I believe built something really beautiful and it was reflected in the sale price,” she said.

Originally from the eastern suburbs, she met her now-husband when he was already living in Manly and she made the move north.

“It was the best move I’ve ever made,” said Mietzke, who works for a commercial property investment group and volunteers on the Manly Business Chamber executive committee.

She praises the beautiful beaches and bushland walks, harbour views, surf breaks and snorkelling spots, as well as the community, small businesses and restaurants.

“I never take it for granted, I just feel really blessed I could bring my children up in Manly,” she said.

“The sad thing is they may not be able to afford to live in Manly one day, that’s the downside.”

Her selling agent, Clarke & Humel director Michael Clarke, was unsurprised to hear northern beaches home owners almost always sell for a gain.

“Historically the northern beaches has always been considered a magical place to live, and as a result more and more people from all over Sydney have chosen to make it their destination of choice,” Clarke said.

“When we all went into lockdown it really focused people on not just where they slept of an evening but where they lived during the day.”

He said the beaches offered a quintessential Australian lifestyle, plus opportunities for boating, surfing and a marine park.

Elsewhere, Belle Property Blue Mountains principal Matt Grima said the low-density area had been attracting Sydneysiders looking for a second home.

“It’s such a beautiful region and it’s within less than two hours of Sydney. It’s a great way for people to buy weekenders ... and it’s been fairly affordable comparatively,” he said.

He thought about nine in 10 buyers there were from out of area and about 30 per cent were buying homes as a weekender. Newer families have been moving into the area for its affordability, as well as retirees.

“It’s such a beautiful, wholesome region. It’s very villagey and surrounded by world heritage national park. There’s a lot of sightseeing, a lot of bushwalking, it feels a bit of a step back in time,” he said.

“For under $1 million you can get a good home, $1.2 million you’d get a really good home, $2 million – wow, you get an incredible home.”