Dee Why – an undervalued suburb coming good

Dee Why beach 1

Dee Why beach

According to Peter Mosedale of Raine & Horne Dee Why, buyer activity in some suburbs of the northern beaches jumped by as much as 400% in the final two quarters of 2009, leading to a jump in prices for both houses and apartments.

Mosedale said that the first home buyers had stimulated the entire market by the end of 2009  where “buyer activity jumped 400% and prices rose 10 – 15%.” He expects this trend to continue and anticipates “double-digit growth” in Dee Why and surrounding suburbs for 2010. Mark Novak of Novak Agency experience a similar trend where “we had a very ordinary first half in 2009 and a dazzling second half of the year”. He said that “properties up to $500,000 were the first to do well in the third uarter and then a flow-on effect for properties priced between $500,000 and $950,000 and now this year, that is kicking onto properties at $1 million and over.”

By far the biggest recipients of the FHOG in New South Wales were buyers in the western suburbs of Sydney such as Liverpool, Campbelltown, Wentworthville, Blacktown and Cabramatta, ranked first to fifth respectively. The list of top 20 postcodes by FHOG value of benefits received for the FHOG is dominated by the western and hills suburbs of Sydney. However, a glaring standout among these western and hills suburbs is Dee Why, which was ranked number 17 .

Dee Why Grand Plaza

Artist's impression of Dee Why Grand Plaza

One reason which may explain Dee Why’s relatively high ranking of number 17 among over 660 suburbs in New South Wales is probably the relative affordability of houses and apartments, compared to its neighbouring beachside suburbs such as Manly, Queenscliff and Curl Curl. Other attractions of Dee Why include its beach and surf culture and easy access to the restaurant and cafe strip along Oaks Avenue where one can wine and dine whilst enjoying breath-taking views of the ocean.

Dee Why had total of 4,354 dwellings processed with a total approved benefit value of $37.5 million given out to first home buyers. This augurs well for the suburb as this influx of first home buyers is anticipated to provide solid support to the residential market over the next 5 – 10 years. Locals and residents of this suburb is less transient as many work around the area and those suburbs towards the Northern beaches such as Collaroy and Narrabeen.

A price comparison of houses and units in northern beaches and its surrounding suburbs appear to indicate that Dee Why has been relatively affordable despite having similar characteristics such as beach and surf culture, restaurant and cafe precinct, local retail shops and amenities. The median price apartment and house in Dee Why is $425,000 and $838,000 respectively. These median prices are among the most affordable when compared to surrounding suburbs such as Freshwater, Curl Curl, Brookvale, Collaroy, Narrabeen and Warriewood.

Apartments in Dee Why enjoyed a whopping 9.4% growth in 2009 from 2008 and is expected to grow by 12% in 2010.  Home sales activity in Dee Why is by far the most vibrant among leading suburbs in the northern beaches. An analysis of sales transactions among the major northern beaches suburbs of Seaforth, Fairlight, Queenscliff, Freshwater, Curl Curl, Brookvale, Collaroy, Narrabeen, Warriewood, Mona Vale, Newport Bilgola, Avalon and Palm Beach revealed that Dee Why’s sales transactions accounted for 21% of total sales transactions in these suburbs in 2009.

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On-going construction of Dee Why Grand Plaza

The current construction of Dee Why Grand, an integrated residential, commercial and retail development at the corner of Pittwater road and Sturdee Parade is set to transform this junction into a busy hub of commercial and retail activity. Property analyst believe this development will transform the commercial precinct of Dee Why just like how Pacific Square Shopping Centre uplifted the entire facade, commercial and retail landscape at Maroubra junction in the east of Sydney. This development appears to be attractive to those who enjoy the convenience of retail shops and commercial amenities such as the post office, medical services, banks and public transport by their doorstep.

The other standout attraction of Dee Why Grand is obviously its modern apartment facilities such as split-unit air-conditioning, European kitchen appliances, 2.7 metre ceilings, environmentally friendly and sustainable construction principles, landscaped gardens, lap pool and gymnasium facilties. An added bonus is its close proximity of 800m to the surf at Dee Why beach.

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Vital statistics

Dee Why Median price $ Weekly advertised median rent $ Gross yield $ 3-year growth % 5-year growth % Average annual growth %
Apartment 425,000 400 4.9 11.1 11.3 5.29
House 838,000 630 3.9 12.8 2.2 7.4

Source: Your Investment Property, March 2010

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How it’s calculated:

Median price: Median price for the 12 months to November 2009

Average annual growth: Average percentage change over the past 10 years as a per annum figure

3 and 5-year growth: Median price percentage change over the past 3 and 5 years to November 2009

Weekly median advertised rent: Median price of rental listings for the 12 months to November 2009

Gross yield: Estimated rental return, based on advertised rent to median price

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Restaurants and cafes along Oaks Avenue

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