Newcastle is a city experiencing a time of momentous redevelopment and growth and is considered the heartbeat of the Hunter. As Australia’s seventh largest city, Newcastle boasts an enviable lifestyle renowned for its stunning beaches, rich maritime history, vibrant arts culture, eclectic bars and acclaimed restaurants.
This positive growth has shifted the city from its prior disposition as an industrial hub to one of the top 10 cities in the world, according to Lonely Planet in 2011. It is also ranked the sixth most visited place in Australia, attracting more than 9.6 million visitors per year.
Newcastle has recently been the beneficiary of a surge in investment activity, largely stimulated by the $6.55 billion State Government investment mandate which has brought to light the new light rail system on Hunter Street, the new transport interchange at Wickham, construction of the Newcastle City University Campus and more.
Colliers International Director Residential Project Marketing Dane Crawford said that sales to Sydney metropolitan based investors have swelled to 20% of total market transactions, up from 5% in 2011.
As Sydney-siders continue their pursuit for stronger yields outside of the Sydney metro area, this has resulted in significant compression of yields in Newcastle. Symptomatically, price growth has now outstripped Sydney’s annual house price growth of 10.2% by 1.3%, currently sitting at 11.5%.
Located on the eastern coastline of Australia, Newcastle presents a combination of city, metropolitan and regional living opportunities. It features golden beaches, world famous surfing, major shopping centres, boutique markets and world-class golf courses.
“Inspired by lifestyle and driven by opportunity, Newcastle is now entering a rising market. Acquiring the 2017 V8 Supercars has raised the domestic and international profile of Newcastle and has been the city’s biggest opportunity to invest in world-class infrastructure and drive an increase in visitation,” Crawford said.
There has also been government input with the NSW Government's Urban Renewal Strategy for Newcastle in place, which according to the Property Council has raised confidence within the property market resulting in an influx of investors. Cutting-edge developers are now highly aware of Newcastle’s capability, and thanks to the government's involvement in development it means the private sector is able to take more investment risk.
“The Council says the State Government's Urban Renewal Strategy has sparked high levels of investment interest in the CBD, both in commercial and residential property," Crawford said.
Meanwhile, Newcastle's city centre is developing its own character and identity that reflects the needs and aspirations for 'Novocastrians' and Sydney investors alike. The architectural rescue of heritage buildings, such as the Herald Building in the East End, preserves Newcastle’s industrial heritage, simultaneously entrapping the city’s need for innovative architectural design.
Contained within a high quality urban environment which is designed for future improvement, Newcastle is built upon vibrant and emerging businesses that thrive on innovation and creativity to generate a new sustainable community. Increased amounts of people working in the private sector means amplified disposable income thus Newcastle’s economy has long-term capability to thrive.
“Investors are attracted to the convenience of inner city residency and the lifestyle opportunities it affords them in a commodiﬁed bundle," Crawford said.
"The upward shift in price points over the last five years has placed Newcastle directly on investors' map as a viable alternative to Sydney life.
"Despite the mining subsidence, the city of Newcastle remains beneficiary of noteworthy capital projects investment."Crawford went on to say that Newcastle offers authentic employment and lifestyle opportunities for Sydney-siders that are priced out of the market and as a result are rapidly penetrating the property market.
Herald Apartments, 28 Bolton Street, NewcastleThe City of Newcastle projects that in 2036, Newcastle’s population is forecast to be approximately 207,450, which is an increase of 42,400 persons (33.4%) from 2016. This represents an average annual growth rate of 0.62%.
Housing tenure is Newcastle is currently 53%, which is higher than the National average and education rates are at a soaring 12.2% in comparison to the current national average of 4.4%.
It's a coming of age for Newcastle, according to Crawford, as developers are awakening to the prospect of affordable stock by envisioning happy lifestyles as greater interest propels Newcastle into the market as economic conditions continue to improve.