Sydney’s worst homes? Inside the crumbling wrecks selling for hard to believe prices

Sydney’s few available homes during lockdown are multimillion dollar properties you cannot even live in.

And with crumbling walls, dangerous drops in the floors and, in one case, no roof – many of the houses require hundreds of thousands of dollars in repairs just to bring them up to an inhabitable standard.

It comes as listing data revealed the Harbour City has the biggest house shortage on record.

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There were about 11,000 freestanding houses for sale across Greater Sydney, including the Blue Mountains and Central Coast, at the end of August, SQM Research figures showed.

This Darlinghurst house sold for $1.68m.

There’s no price guide on this burnt down Forest Lodge house but it could sell for over $1.2m.

The shortage is the result of homeowners delaying sales during lockdown, with many fearing lockdown restrictions will limit agents’ ability to show prospective buyers through their homes.

Much of what is available is dated, derelict or plain rubble – properties typically owned by vendors with no choice but to sell, along with deceased estates listed years after they were last inhabited.

With buyer demand still elevated, many of these homes were listed at lofty prices that did not reflect their condition.

Among the uninhabitable homes recently for sale was a $5.85 million Bronte house listed partially through a construction project.

Darlinghust dump and agent

Agent Maclay Longhurst sold this rundown terrace for over $3.8m. Picture: Sam Ruttyn

Listing images revealed an interior of stripped down ceilings, debris, uneven floors covered over with planks of wood and a massive drop in the living area floor.

A fire-damaged house in the inner west suburb Forest Lodge has been listed without a price guide but is expected to sell for over $1.2 million.

Listing agent Mark Tooth of Belle Property would not comment on the circumstances behind the fire.

The damage was significant. Walls were covered in soot, windows remain boarded up and tagged with graffiti, while sections of roof were reduced to nothing more than beams.

This Bronte house had a guide of $5.85m.

The two-bedroom house on Bridge Rd was one of only seven houses available in Forest Lodge. Two of the other available houses are also fixer uppers, including one on Hereford St listed for $2.1 million.

In many instances, the initial price expectations were well below the eventual sales prices.

A derelict terrace in Darlinghurst with boarded up windows and doors sold last week for just over $3.81 million, but agents had advised interested buyers to come prepared to spend over $2.5 million.

Selling agent Maclay Longhurst of BresicWhitney, who has sold multiple dumps for over $2 million, said the houses could sell at such high prices because buyers wanted a “blank canvas”.

“Everyone has their own idea of what a Victorian terrace should look like,” he said. “People want to put their own mark on a property but there are not many properties where you can do that.”

This house in Berowra Waters is for sale with a guide of $450,000. It has no road access and can only be reached by boat.

Agent Shannan Whitney also sold multiple dilapidated homes during lockdown and said many of the properties would have sold for high prices even without the housing shortage.

“These properties can appeal to all buyer types so that increases the competition. With more competition, the prices go up,” Mr Whitney said, adding that buyers far outnumbered sellers.

This imbalance between supply and demand was so extreme that some inner Sydney wrecks were selling for hundreds of thousands of dollars above prices paid last year.

In Waterloo, a house on Morehead St that sold last year for $1.01 million resold in July for over $1.4 million – despite the seller doing nothing to remedy the holes in the walls and unstable structure out the back.

110 Morehead St, Waterloo sold in 2020 for about $1m and again in 2021, still rundown, for over $1.4m.

Ray White chief economist Nerida Conisbee said buyers who splurged on fixer upper properties would need to pay inflated prices for the renovation itself.

Materials costs have skyrocketed due to a global building boom and disruptions to supply chains during Covid, she said.

Labour was also in short supply because of the HomeBuilder scheme introduced during the early stages of the pandemic last year, while lockdown restrictions created a backlog of projects for tradies.

“You will have to pay more for a renovation and builders are already committed to projects,” Ms Consibee said.

“Materials is a particularly big problem … timber is in short supply because of the bush fires in 2019 and at the more extreme end we’ve seen iron ore prices shoot up because of more building in China.”

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