NSW's Lismore is flood prone, but high floor level homes fetch good prices: HTW

The North Coast regional township of Lismore in NSW has drawn the attention of valuation firm Herron Todd White in their April 2016 property clock that talks of fringe suburbs and affordability.

Given the relatively small size of the regional centre (Lismore City), there is not a discernible fringe suburb element.

However, in regard to affordability, the older suburbs of North and South Lismore on the (curiously) western side of the river fit the bill. These particular suburbs are well known in recent history as being flood prone and have been subject to some intense debate following the construction of the levee designed to protect the Lismore CBD from nuisance floods i.e. below a one in ten year flood event. Cold comfort if a bigger flood signals its arrival... and North and South Lismore usually cop it.

The price levels and rental levels are therefore traditionally lower than the other suburbs of Girards Hill, East Lismore, Lismore Central, Lismore Heights and Goonellabah.

However, North and South Lismore are not bereft of services with local schooling nearby, a small retail strip with food outlets, bakeries and a pharmacy and its fair share of liquid refreshment from the various taverns and hotels located in this area.

A typical North or South Lismore home is generally well elevated (to escape those nasty flood waters) which in turn provides ample car-parking space and storage underneath. As a result of the estimated height of 12.4 to 12.6 metres, according to the Australian Height Datum for a so-called one in one hundred year flood event, any new residential development requires a minimum habitable floor height 500 millimetres above this level. The main habitable floor would therefore be expected to be a neck craning 2.5 to three metres above ground level.

This applies to new development. However, most of the houses in North and South Lismore were built circa 1920 to 1940 when such fastidious building regulations were not in place.

Therein lies the sting in the tail. Generally most houses with a habitable floor level below the estimated one in one hundred year flood event level could experience a lot of difficulty in securing lender finance, unless the intending owner or purchaser can provide a much higher equity injection i.e. below the standard 80% LVR. Then there is the tricky issue of insurance premiums which have soared in recent years for flood insurance.

These aspects have an impact on the overall price level for properties in North and South Lismore, but not as much as you would expect.

There was a time when purchasing a property in these areas would have a figure south of $150,000. Today, well presented and renovated homes with a floor level above the one in one hundred year flood event can attract sale prices greater than $300,000 with rental levels of $300 per week plus for 3- to 4- bedroom and 2-bathroom homes.

Generally, the median price level ranges from $230,000 to $250,000 with typical rents in the region of $250 to $280 per week for a three-bedroom, one-bathroom home.

Property Observer looked up some recent sales of houses around the median price figure in and around North and South Lismore and came up with these examples from www.realestate.com.au:

1. A five-bedroom above flood-level house at 17 Wotherspoon Street North Lismore sold recently for $234,000.

2. A three-bedroom house at 39 Caniaba Street South Lismore NSW 2480 traded for $268,000, according to RP Data.

Just as the other suburbs in Lismore City have improved over the past 12 years, so to have the northern and southern Lismore regions.

Currently, the North and South Lismore residential markets are relatively stable with no records being broken or set, just like the other suburbs in Lismore City.

However, beware the precipitous beast known as the Northern Rivers flood rains and often the faded memories of 1954 and 1974 will come rushing to the fore. Nary has a Lismorean forgotten those times of flood and debris. A bout of that may put a dent in the value of homes on the North and South Lismore lowlands. Let’s hope not.