House Prices

House prices

Data source: NSW Govt Rent and Sales Report.

The latest data shows the median price of housing in the Hunter starting to increase again, with a 1% increase from March to June 2023 in the Greater Newcastle Area (for the Cessnock, Lake Macquarie, Maitland, Newcastle and Port Stephens, based on the aggregate available in the NSW Govt Rent and Sales Report see regional explanations in the footnotes). All LGAs have maintained significantly higher median prices than pre-COVID, but are still below NSW averages on a value basis. Price increases in the 6 months to June 2023 are evident in Singleton, Maitland, Dungog, Cessnock, Port Stephens, Lake Macquarie and Newcastle. Upper Hunter Shire, Muswellbrook and Mid-Coast saw declines.

Data source: NSW Govt Rent and Sales Report.

Rental prices

For renters, there was hope that a peak in rental prices in mid-2023 may be followed by a stabilisation or decline in prices. However, for most LGAs in the Hunter, there is still a strong upward trend in prices. The data below is for the median weekly rent for 3-bedroom stand-alone houses. It is possible to see the median value by LGA, or the median values by LGA indexed to September 2010 (i.e. showing relative price increases for each LGA before and after September 2010). The latest data from the NSW Govt Rent and Sales Report extends to the third quarter of 2023.

Data source: NSW Govt Rent and Sales Report. Data indexed to start 2009.

In the 3 months to September 2023, at the LGA level, there were mixed signals. Newcastle, Lake Macquarie, Cessnock and Muswellbrook all recorded further increases in rents. Dungog has a very small rental market (not enough data was available to interpret trends in the second quarter of 2023) and saw a large decline. Smaller declines were evident in Maitland and Singleton. Upper-Hunter, Mid-Coast and Port Stephens all saw no change in median rents. Taking a volume weighted average of all new rents, the Greater Newcastle region (see comments about regional definitions above and in footnotes) saw an increase of 1.3% in the last quarter. Greater Sydney had an increase of around 5% in the September quarter.

Data source: NSW Govt Rent and Sales Report.

House prices to annual rent ratio

The ratio of house prices to annual rent is an indicator of affordability of rental prices in comparison to house purchase prices. The ratio is also used by investors to determine likely returns on investments The figure below shows the ratio of house price for a median 3 bedroom house to the rental price. Internationally, a value of 20 is a common baseline, and Australia tracks well above this number (reflecting the relatively high price of housing purchases). The ratio for NSW is in the range of 30-36 (i.e. the cost of purchase is 30-36 times the annual rent for a similar house). In the Hunter, most LGAs have ratios closer to 25. The peak in house prices seen above in 2022 is also evident in the peak in the price to rent ratio (implying that the rents did not peak in the same way as house prices). The decline in the ratio since 2022 implies that rental prices have been increasing faster than house prices during this period. This result appears to be common for all LGAs, although some (such as Lake Macquarie) are experiencing faster declines in the ratio than others (such as Singleton).