Lawless said reduced turnover was helping to fuel the market’s recovery. There were 311 homes for sale in Byron Bay in February, down 5 per cent on the previous year.
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“Byron Bay arguably became too expensive, but the fundamentals haven’t changed,” Lawless said. “Many people still want to live there.”
He said Byron Bay’s tight rental vacancy rate of 1 per cent in February was further evidence of the town’s desirability.
Kim Jones, principal of Kim Jones & Co, moved to Byron Bay in 2021 after selling her family’s real estate business, Di Jones, in Sydney.
“I’ve been following markets my whole life and I’d never seen a market move like that,” she said of Byron Bay’s pandemic-era boom.
Those who bought at the top of the market and now wanted to sell were “stuck,” she said.
The Byron Shire has a median dwelling value of about $1.5 million.Credit: Danielle Smith
“If you paid peak prices and haven’t added value to the property, you can’t get your money back. Buyers these days have data knowledge, and they’ll only pay 20 per cent under the peak for those properties.”
Peak-priced properties aside, Jones said it felt like the Byron Bay market was moving again, thanks in part to an increased volume of buyer enquiries.
Recent off-market sales, including a rumoured $18 million cash splash by Sydney nightlife mogul Justin Hemmes, have sent ripples of excitement through the town.
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“The high end is performing very well,” Jones said. “The best properties are selling easily.”
Demand for lower-cost housing was also strong, Jones said, but prospects of new supply were slim.
“Council hasn’t approved any major sub-divisions, and the new apartments in town are for the luxury buyer.”
Jones said Byron Bay had been overshadowed in recent years by nearby lifestyle markets such as the Gold Coast, but she expected the market to “accelerate” over the next three to six months.
Will Phillips, Principal of Sotheby’s International Realty Byron Bay, said buyer interest from Sydney and Melbourne had been robust so far this year.
He said a rebounding market that remained below its peak was an enticing prospect for those further south.
“The demand has always been there. What’s changed is the value proposition. Now, for someone in Sydney or Melbourne, we look like good value. We seem interesting and exciting again.”
Phillips, whose current listings include a five-level mansion on exclusive Marine Parade with a $75 million guide, said a fear of missing out was motivating buyers at the very top of Byron Bay’s market.
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“There’s a limited number of genuine trophy-style properties in the area. If you want beachfront, there’s only a small number of houses. If you want A-grade hinterland, there’s only a few.”
Phillips said the town’s “old guard” – that is, residents who were living in Byron Bay in the decades before its popularity exploded – were gradually selling their properties.
“Once those trophy properties get snapped up by people from out of town who can afford them, they’re not going to hit the market again. So, year by year, the number coming to market gets fewer and fewer.”
Of the trophy properties, those in like-new condition were selling “very easily,” largely to buyers for whom money was no object, Phillips said.
“These people are time-poor. They value time with family, and they have no issue with paying a premium. They don’t want to spend four years dealing with a builder and council.”