One thing is for sure with the Australian property market; most markets around the country experience an inconsistent flow of capital growth. Many markets experience most of their capital growth in as little as one third of the cycle whilst the other two thirds of the cycle produces very little growth.

In this newsletter, we take a look at where the leading property researchers think we are ‘as at 2013’ in the Sydney property cycle.

Property Cycle

Market Summary by Herron Todd White.

With signs showing markets are moving around the nation, there are many buyers who have been waiting in the wings and are now keen to start getting serious about purchasing. The low-price sector is a great gauge of market sentiment. It is often dominated by investors and first home buyer – both purchaser profiles are sensitive to affordability.

By studying the entry level sector we may get a gauge on what is happening in our market overall across the coming year.

Herron Todd White

Sydney is currently experiencing a genuine boom at the lower end of the residential property market. This is mainly a combination of historically low interest rates and extreme lack of supply. This situation is not particular to any suburb within metropolitan Sydney; it is across the board.

 

 Sydney Housing Market Indicators

FACTOR STAGE
Rental Vacancy Situation Balanced market
Rental Vacancy Trend Steady
Demand for new houses Strong
Trend in new house construction Steady
Volume of house sales Increasing
Stage of property cycle Rising market

 Westpac

NSW property market has experienced up to 10 years without any significant capital growth. Bill Evans from Westpac said that Sydney is in a ‘catch-up phrase’ and this is a major reasons that he expects Sydney to be the best performing Australian capital city over the next few years.

House Prices – Solid Increases Expected 

Solid Increases Expected

 Residex

Sydney Houses

  • Residex predict that Sydney Houses will grow by 7% p.a. over the next 8 years.
  • There were 40,852 house sales in Sydney during the last year.
  • Capital growth in the Sydney housing market over the last year was 7.37% and the Sydney median house value is now $715,500.
  • The Sydney house median rental yield is 4.27% and the median weekly rent is $585.

Residex

 Sydney Units

  • Residex predict that Sydney Units will grow by 5% p.a. over the next 8 years.
  • There were 37,500 unit sales in Sydney during the last year.
  • Capital growth in the Sydney unit market over the last year was 2.29% and the Sydney median unit value is now $501,500.
  • The Sydney unit median rental yield is 5.25% and the median weekly rent is $505.

Residex Units

 RP DATA

“The housing market is being buoyed by very positive conditions in Sydney, Perth and to a lesser extent Melbourne, with residential values in these cities now 3.7 per cent, 4.4 per cent and 2.4 per cent respectively higher over the past three months alone. At the other end of the scale you have cities like Adelaide, Brisbane and more recently Darwin where conditions are more sedate with dwelling values slipping lower over the past quarter.”

This article is at August 2013

 GENWORTH

Increases in the Genworth HCI were recorded across all the major states. New South Wales confidence saw the highest increase of 9.6% from 91.8 in March 2013 to 100.6 in July 2013, while WA recorded the lowest increase of 0.8% from 96.5 in March 2013 to 97.2 in July 2013.

Download the Genworth “Sreets Ahead Report”

Confidence Ratings

Confidence Ratings

Contact Pillar Property on 1300 781 824 for advice with your property purchase.