The changing buying preferences of Australian buyers due to the COVID-19 pandemic could result in a rise in the take-up of holiday homes in New South Wales, says an expert at the Real Estate Institute of NSW.
The strong interest in short-term rentals could compel more buyers to entertain the idea of buying a holiday home, especially with the working-from-home trend, said Tim McKibbin, CEO of REINSW.
"This year, lifestyle as a factor in a holiday home purchase potentially carries greater influence. The pandemic and its aftermath, including the widespread acceptance of working from home, means a holiday home may account for a larger proportion of a purchaser’s time spent," he said.
The movement of regional dwelling prices and the increase in sales could indicate this burgeoning trend.
Regional markets in the state have registered a 3.1% growth in dwelling prices over the three months to November, significantly outperforming Sydney's 0.3% gain, according to the latest CoreLogic figures.
Furthermore, sales volumes in regional markets have hit a 14.2% increase, reflecting a pandemic-fuelled decentralisation.
"Should the decentralisation trend triggered by the pandemic continue to play out, demand for quality properties in traditional holiday destinations will steadily swell and become less susceptible to seasonal shifts. It follows that the impact on prices will be positive," McKibbin said.
McKibbin believes buying a holiday home over the next year would mean much more than buyers just wanting to get a vacation home. Instead, he said a visit to the holiday home could form part of their weekly routine.
While buying a holiday home might have triggered buyer's remorse in the past, McKibbin said the current market conditions seem to be turning things around.
"If the purchase is for lifestyle, and the prospect of rental returns for part of the year is simply a bonus, it can make both emotional and commercial sense, depending on the numbers," he said. "This year people who don’t proceed with a well-considered holiday home purchase may experience a case of lifestyle remorse."
