NSW land values soar despite pandemic pain
Land values across NSW have soared to a record $1.8 trillion in the past year despite the pandemic with the State's obsession with bricks and mortar defying predictions of a slump.
Regional towns boomed as city-dwellers head for the bush with towns such as Dungog, Byron Bay, the Central Coast, Lake Macquarie and the Snowy Mountains experiencing some of the largest land value increases on the back of strong demand from tree and sea-changers.
The State-wide infrastructure boom pushed up land values in areas near new rail links, mines and roadways while in the city, the once "fringe" city suburbs of Alexandria, Zetland, Waterloo and Rosebery soared by 12 per cent.
SCROLL DOWN TO SELL ALL THE LAND VALUE CHANGES IN SYDNEY AND REGIONAL NSW
The online shopping boom also pushed up demand for industrial sites capable of housing warehouses and courier vans, leading to a rise in values.
The biggest loser out of the pandemic was CBD office, hotel and serviced apartment land values which plunged by 25 per cent with the decline in demand, according to the latest NSW Valuer-General's report.
More than 48,000 sales were analysed as part of the report, which includes an assessment of every parcel of land in the state.
The land value does not take into account the value of your home or other structure, but it does take into account site improvements such as clearings.
The valuations will be used by Revenue NSW to determine land tax liabilities, which apply to investment properties.
SCROLL TO THE BOTTOM FOR ALL NSW REGIONAL LAND VALUE CHANGES
NSW Valuer General, Dr David Parker said the latest valuations showed just how resilient the residential property market is despite economic hits such as the pandemic.
"Residential land had a little dip at the start, but as we adjusted to the pandemic, the auctions came back and it was back to normal, and in some areas, where you've had good infrastructure improvements or tree-changers moving in, values increased," Dr Parker said.
"Where you've had good investment in infrastructure such as freeways and rail lines, the rises are really noticeable.
"But for commercial land, it was a different story. Borders closed, tourists stayed away, shops closed, workers stayed at home and have been reluctant to come back which has affected values largely in the city."
Land values across the State rose by three per cent from $1.74 trillion to $1.8 trillion in the year to July, although some regional hot spots such as Parkes experienced increases of up to 17 per cent.
Regional land value increases were driven by increased demand for properties close to major infrastructure projects such as Snowy 2.0 and mines or were in the sights of "tree-changers".
Lifestyle buyers pushed up demand on the north coast in areas such as Byron Bay, Scotts Head, Gloucester and Northern River villages, while relocating Newcastle and Sydney buyers were behind land values rising in the regional towns such as Dungog.
A "ski change" factor was behind a 15 per cent increase in land values in Snowy Monaro Regional with rising demand for "lifestyle holding" and properties close to the snowfields.
Other booming coastal areas include the Richmond Valley, Kempsey and Nambucca where values have risen by up to nine per cent.
Water, Property and Housing Minister Melinda Pavey said the pandemic had demonstrated how it was possible for people to move out of the city without sacrificing a career.
"These results show that the State's residential property market continues to show remarkable resilience in the face of extreme headwinds," she said.
"Despite the doomsayers, property remains one of the most resilient asset classes."
Rising demand for quality farming, mixed cultivation and grazing land following the end of the drought increased rural land values by 4.8 per cent.
In Sydney, residential land values rose by 4.3 per cent although strong demand in South East Regional NSW, Sydney Central and Sydney North West Regions resulted in an even bigger rise of seven per cent.
The highest overall local government area increases were in Georges River, Hornsby and The Hills Shire where values jumped between seven to 10 per cent.
In western Sydney, demand for affordable housing resulted in land values rising in Blacktown, Fairfield and Penrith by up to four per cent.
However, the biggest increases were in Redfern and those close to the developing Green Square area such as Alexandria and Rosebery with land values rising 12 per cent this year after falling last year.
Properties located on the western side of Palm Beach, where there is still a strong demand
for prestige homes, also were immune to the pandemic, with values rising 11 per cent.
The pandemic did have some impact, with commercial land plunging in both the city and less in the bush.
Dr Parker said the value reductions for hotel and serviced apartment properties and retail shops in regional areas will be of particular relief for the State's ailing tourism industry given the land tax would decrease.
Industrial sites soared as e-commerce and online shopping increased the need for warehouses, from large-scale "Amazon" holding areas to smaller inner-city sites able to park a small fleet of courier vans. .
The dwindling supply of industrial land in the City of Sydney resulted in values rising by 16.9 per cent.
While the breaking of the drought pushed up rural land values with the rise in demand for farming land, the latest land assessments showed the "Black Summer" bushfires impacted land values in areas such as the Blue Mountains and Wingecarribee.
LAND VALUATION CHANGES
|Sydney Coast North||Residential||+2.2%|
|Sydney Coast South||Residential||+3.9%|
|Sydney North West||Residential||+6.9%|
|North Coast Region||Residential||+3.5%|
|North West Region||Residential||Steady|
Originally published as NSW land values soar despite pandemic pain