A quiet coastal village of just 450 people was the biggest winner in the property boom of 2021.
The Port Stephens township of North Arm Cove recorded the strongest annual growth in dwelling values of any Australian suburb, rising a mammoth 64.4 per cent according to CoreLogic figures.
What might surprise outsiders is that most sales in 2021 were less than $40,000.
The explanation for this factors in zoning, Walter Burley Griffin and 100 years of complex history.
THE LANDSCAPE
North Arm Cove could have been anything.
In the 20 years to 1919 it was considered as a site for a naval base and the nation's capital before the area's council approved Walter Burley Griffin's plans for 'Port Stephens City'.
The Canberra designer's plans for railways, wharves and gardens never eventuated, but some waterfront homes were built before all undeveloped land was zoned 'rural' in the 1960s.
RELATED: Huge $6.9 million sale sets new record for Bar Beach
$5m Kilaben Bay stunner could be region's top tennis court home
Astonishing Nissen hut renovation preserves Belmont North history
Today, North Arm Cove is split into two sections - a village of about 300 homes and a cluster of more than 3000 undeveloped blocks.
The town has no shops, mains water or sewage systems, but residents say there's nowhere like it.
"It's a lovely little quiet village to live in, people love living there," said Bob Reid, a resident of 30-plus years.
"They like the environment, the bush ... it's a wonderful little bit of paradise."
All remaining blocks have non-urban zoning, which prohibits dwelling structures and restricts owners from spending more than two consecutive days, or 60 days in a year, on their properties.
Non-urban landowners pay between $300 and $600 every year in rates, and many blocks are only accessible via privately-owned roads.
Non-urban landowners regularly hand over their blocks to MidCoast Council, which owns about 1000 lots, in lieu of paying rates.
WHO'S BUYING?
The property frenzy may have calmed, but North Arm Cove's annual growth rate still sits at 35.1 per cent in the 12 months to July.
First National Hawks Nest's John Rumble says much of the town's astonishing growth can be attributed to sales of village homes.
"Five years ago people were buying these properties on the waterfront for $800,000," he said.
"Four or five years later they're selling for $1.4, $1.5, $1.6 million which is unheard of."
He said there were several factors that led owners to offload non-urban blocks, which typically sell for between $25,000 and $45,000.
"Some people just don't get up here enough to be able to use them, others have had these same blocks in the family for 30 to 50 years and they've been handed on down.
"The kids and grandkids say 'this is never going to happen' and they sell it.
"The main reason people buy them is to set up for recreational camping, and they're coming from everywhere - Newcastle, the Central Coast, Sydney."
WHAT'S NEXT?
MidCoast Council advises on its website that future rezoning of paper subdivisions such as North Arm Cove is "highly unlikely".
The council is in the process of adopting a Rural Strategy, which is understood to involve rezoning North Arm Cove's non-urban land to environmental conservation or management land.
The rezoning would still not permit dwellings.
Many believe it could be decades before further development takes place at North Arm Cove, however, a landowner community group is pushing for it to happen much sooner.
"Up until now it hasn't been feasible," said David Buxton, of North Arm Cove Rate Payers Association.
"You would need sewer and stormwater and power ... it would all have to connect to the sewer system at Tea Gardens and the cost of that connection was worth more than the land was worth.
"But now because land values have gone up so much and we have reticulated water systems, all of this can be done much cheaper."
