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As Australians look to domestic travel options this summer, more Australians are likely to entertain the idea of buying a holiday home in the coming weeks and months.
In an update from Real Estate Institute of NSW (REINSW) CEO Tim McKibbin, he said the working-from-home phenomenon has “shifted the goalposts and could mean a rise in holiday home transactions this summer”.
“Overseas holidays are off the agenda this year, which means more people will be discovering or re-discovering domestic destinations over coming weeks and months,” the CEO said.
Mr McKibbin has observed short-term rentals in popular spots are filling up fast over the Christmas period, and “it’s that time of year when people have romantic thoughts about purchasing a holiday home for themselves”.
While acknowledging that the decision to purchase property should never be based on emotion alone, the CEO said “when the numbers align, lifestyle is a perfectly good reason to buy”.
This year in particular, Mr McKibbin considered 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.”
According to the CEO, “a holiday home in 2021 has the potential to be much more than a weekend getaway for families when timing makes it possible”.
“Instead, a visit to the holiday home in the future could form part of their weekly routine.”
It’s this realisation that Mr McKibbin believes could result in an uplift to holiday destination transactions this summer.
The trend could already be playing out, with the REINSW flagging the significant outperformance of regional markets with respect to dwelling prices and sales volumes when compared to Sydney.
Continuing, Mr McKibbin stated that buying property is always a serious financial decision, and “unfortunately, some spur-of-the-moment purchasers experience buyer’s remorse because the acquisition was driven by a disproportionate amount of emotion and not enough reality analysis”.
“But 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.”
Should the decentralisation trend triggered by the pandemic continue to play out, he forecast that demand for quality properties in traditional holiday destinations would steadily swell, becoming less susceptible to seasonal shifts.
“It follows that the impact on prices will be positive,” the CEO said.
“Instead of a holiday home being a cause for buyer’s remorse, as it may have in the past, this year people who don’t proceed with a well-considered holiday home purchase may experience a case of lifestyle remorse.”
ABOUT THE AUTHOR
Grace Ormsby
Grace is a journalist across Momentum property and investment brands. Grace joined Momentum Media in 2018, bringing with her a Bachelor of Laws and a Bachelor of Communication (Journalism) from the University of Newcastle. She’s passionate about delivering easy to digest information and content relevant to her key audiences and stakeholders.
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