Market Report - New South Wales (June 2008)


While recent rate rises might mean some woe in the outer suburbs, there are still property bright spots and investor opportunities to be had in the NSW capital.

Sydney experienced a historically modest rise in its median house price to $577,500, a rise of 7.22% for the year. Units similarly saw a quiet improvement of 5.61% for the year to $398,500 according to Residex.

Sydney, or more predominantly Sydney's mid ring and outer western suburb mortgage belt localities, have been the most notable victims of our runaway national economy. The Reserve Bank's use of rate rises as an inflationary pressure-release valve may be easily absorbed by some Australian markets, but for the nation's biggest city, it has continued to create heartache according to Braxton Chase.

CEO Andrew Donnelly cites the difficulties the reserve bank has created for the New South Wales capital:"If there's one market in Australia that could have done without interest rate rises this year, it's Sydney. Along with jamming the brakes hard against possible growth in the already sluggish western and south-western corridor, the rises have made it a bit harder for buyers to get a foothold into the market," Donnelly says.

Whilst it does spell a grey market for many property owners, it will afford the savvy investor opportunities to pick up possible bargain properties as eager vendors look to offload their holdings.

"Real estate sleuths will always be out there zeroing in on bargains and enjoying the fruits, particularly in areas prone to distressed selling," Donnelly says.

It's not all downside however, with ongoing supply pressure in some sectors providing a positive influence.

"The shortfall of new housing is becoming more pronounced," Donnelly adds, "which is placing upward pressure on prices."

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