IT has arguably one of the best views money can buy in Merewether.
And after being taken off the market late last year, 39 Hickson Street is for sale again and comes with a price drop.
The five-bedroom, three-bathroom home was previously listed for auction in July with a guide of $4.9 million to $5.39 million through Belle Property.
However, it was taken off the market in November after 127 days.
The property is relisted with Robinson Property's Mike Flook who has priced the architecturally-designed home with a guide of $4 million to $4.5 million.
"It has been adjusted from where it was to this figure now," Mr Flook said.
"There is no doubt that prices have gone back somewhat but since it came back on the market this week I have had some good, strong enquiry."
Built in 2001, the home was designed by Kevin Snell of Studio Snell Architects and spans two levels, including a climate-controlled wine cellar underneath with storage for more than 1000 bottles, a courtyard, deck and living spaces framed with floor-to-ceiling glass.
The owners, who are selling to relocate to Sydney, described the ocean view from the home as "dramatic".
"You are always aware of the changing colours and patterns of the sky and sea, depending on the weather and the time of year," the owner said.
"Waking to a beautiful sunrise or finishing the day with the full moon rising over the ocean is truly spectacular."
There are coastal and bushland views from nearly every room in the house and it's a short walk to Hickson Street Lookout.
"It boasts breathtaking ocean views and offers privacy in a cul-de-sac with an outlook over Glenrock Estate, but it's literally a third of the price of homes that are for sale down on the flat [in Merewether]," the agent said.
"There is a hell of a lot of value here for somebody looking for a prestige home that is a master built quality home.
"It is an architecturally-designed home with views that you are never going to lose."
Vendor discounting has increased in the wake of rising interest rates following the Reserve Bank of Australia's first rate hike in more than a decade in May last year.
A report released by CoreLogic last week revealed that Newcastle vendors are discounting an average of 5.3 per cent on the advertised price, compared with 3.3 per cent this time last year.
Mr Flook said that the majority of vendors selling in the current market understand that their price expectations need to be adjusted.
"The first thing I discuss with any of my vendors listing a property is to make sure that they are aware that if they have had an appraisal done 12 months ago, they have to get those figures out of their mind and look at what has been selling, and not in the last six months but more in the last four weeks," he said.
"The market at the moment can change each time the rates go up and we have had nine consecutive rate rises so the market is forever changing.
"Certainly it seems to be reaching its peak."
Significant discounting on expensive properties is increasing as the higher end of the property market experiences to biggest hit to values.
The most expensive 25 per cent of houses in Newcastle and Lake Macquarie fell 10.9 per cent in value in the past 12 months, according to CoreLogic's Regional Market Update report.
On Saturday, an architecturally-designed home at 62 Memorial Drive, Bar Beach sold for $4.23 million after 130 days on market.
The sale price was considerably less than the $5.5 million guide it was listed with back in October when it was set to go under the hammer.
Housing values are expected to trend lower in the wake of further rate hikes that are anticipated by the Reserve Bank of Australia and CoreLogic's head of research Eliza Owen said regional areas would not be immune from softer conditions.
Ms Owen said that sellers will need to be realistic about their pricing expectations and be ready to expect some negotiation from buyers.
"Considering some of these regional values will have only moved through a peak in the cycle more recently, it's likely there will be a lag between buyers and sellers," she said.
However, Ms Owen noted that while some regional markets were experiencing sharp price falls, regional market performance overall remained more resilient than capital city dwelling markets.
Since the rate hiking cycle commenced in May, monthly value changes have averaged falls of 0.8 per cent across regional Australia through to January, compared to a drop of 1.1 per cent in the capitals.
