Burgess Thomson Lawyers

New Face. New Home Buyer. Newcastle.

Newcastle NSW Australia Beach

Newcastle’s property market is witnessing a significant shift as a new generation of first home buyers emerges, reshaping the landscape of home ownership in this vibrant coastal city. With changing demographics, economic factors, and lifestyle preferences, the profile of first-time buyers in Newcastle is evolving rapidly.

Market Performance Overview

Newcastle’s property market showed impressive strength throughout 2024, with steady growth in both house and unit prices. As of June 2024, the market pressure for houses in Newcastle was balanced with an upward trend, creating opportunities for both buyers and sellers and contributing to a healthy real estate ecosystem.

The average number of days houses remain on the market has been decreasing since mid-2023, indicating growing demand and potentially signalling a quicker rebound in prices moving forward. Newcastle’s housing market is experiencing a supply-demand crunch, with inventory levels consistently maintaining about two months’ worth of stock since 2023, relatively low compared to other regional cities experiencing price spikes.

Key Statistics

As of June 2024, the median house price in Newcastle stood at $760,000, while the median unit price was $547,500. The annual growth from Q2 2023 โ€“ Q2 2024 was 3.4% for houses and 3.3% for units. House sales grew 10.5% for houses (to 158 sales) and a -21.2% decrease for units (to 26 sales). 

Median Property Prices (Q2 2024)

Hunter Valley Median Property Price 2024

Reference: https://www.prd.com.au/huntervalley/research-hub/article/hunter-valley-property-market-update-2nd-half-2024/

Historical Context and Current Trends

House Prices (10 Years)
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Rental Prices (10 Years)
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House Prices (2020-2023)
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Reference: https://www.investorkit.com.au/blog/market-pressure-review-newcastle-in-10-charts/

Over the past decade, Newcastle’s house prices have grown by 100%, aligning with the average growth of top-populated regional cities and surpassing Australia’s long-term average of 5-6% annualised growth. In the last growth cycle (2020-2023), house prices increased by 42% in 3 years, averaging over 12% growth annually.

Similarly, rental prices in Newcastle have grown by 61.5% over the past decade, matching the average growth rate of top-populated regional cities and exceeding Australia’s long-term average.

Historically, first home buyers in Newcastle were typically local young couples in their late 20s or early 30s, looking to settle down in familiar suburbs. However, recent data paints a different picture. The median age of first home buyers in Newcastle has shifted, with many now in their mid-30s to early 40s.

This trend reflects broader national patterns of delayed home ownership due to factors such as extended education, career establishment, and changing life priorities.

Demographics and Origin of Buyers

Interestingly, Newcastle is seeing an influx of first home buyers from outside the region, particularly from Sydney. The affordability gap between Sydney and Newcastle, combined with the latter’s lifestyle appeal and economic growth, has made it an attractive option for those priced out of the Sydney market. This trend has been further accelerated by the rise of remote work, allowing more flexibility in choosing where to live.

Popular Areas for First Home Buyers

Several Newcastle suburbs have become hotspots for first home buyers:

  • Mayfield: Known for its affordability and proximity to the city centre, Mayfield offers a range of housing options and has seen steady growth in property values.
  • Wallsend: With its family-friendly atmosphere and spacious properties, Wallsend is attracting many first-time buyers looking for long-term homes.
  • Birmingham Gardens, Jesmond, and Shortland: These suburbs near the University of Newcastle are popular among younger first home buyers and investors.
  • Hamilton: Its vibrant cafรฉ scene and character homes appeal to young professionals entering the property market.

Map Source: https://www.google.com/maps/@-32.9135661,151.7238179,14z?entry=ttu&g_ep=EgoyMDI1MDExNS4wIKXMDSoASAFQAw%3D%3D

Home Ownership Rates by Generation

While specific data for Newcastle is limited, national trends show varying home ownership rates across generations. In the City of Newcastle, 59% of households were either purchasing or fully owned their homes in 2021.

This figure suggests a strong desire for home ownership across different age groups, including first-time buyers.

Factors Contributing to Change

Several factors are influencing the changing face of first home buyers in Newcastle:

Challenges and Opportunities

Despite the changing landscape, challenges remain. The minimum household income required to buy a house in Newcastle was $237,103 in 2024, which is still out of reach for many.ย However, this has led to creative solutions, with some first-time buyers opting for apartments or considering renovator’s delights in up-and-coming suburbs.

Future Outlook

Several factors are As we look towards 2025, several trends are likely to shape the Newcastle property market:

The evolving profile of first home buyers in Newcastle reflects broader societal changes and economic realities. As the city continues to grow and develop, it’s likely to see further diversification in its first home buyer demographic, bringing new energy and ideas to established neighbourhoods and emerging communities alike.

Conclusion

The Newcastle property market in 2024 presented a balanced yet dynamic landscape. With steady price growth, tight supply, and strong rental demand, Newcastle continues to offer attractive opportunities for both homebuyers and investors. As the city evolves with new infrastructure and development projects, certain suburbs are poised for significant growth in the coming years.

For those considering entering the Newcastle real estate market, whether as a homebuyer or investor, it’s crucial to conduct thorough research and seek professional advice to make informed decisions in this evolving market landscape. The combination of population growth, infrastructure development, and economic strength positions Newcastle as a promising market for real estate investment in the years to come.ย 

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