Unprecedented growth pushes Sydney medians past $1 million

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The June quarter has lifted Sydney house prices to “unprecedented” levels, with new research from the Domain Group revealing their median price is now a seven-figure sum.

According to the Domain House Price Report, the median price for a house in Sydney now sits $1,000,616 after capital growth of 8.4% over the June quarter.

Domain Group senior economist Andrew Wilson said while the situation in Sydney is one that hasn’t been seen before, he wasn’t shocked by the way the market is behaving.

“It’s certainly unprecedented and perhaps not surprising though,” Dr Wilson said in a Domain Group video.

“We’ve had a record autumn for auction clearances rates, we’ve got record numbers of investors invading the Sydney market, those low interest rates, the lowest interest rates since the mid-60s, have released all that price energy onto the Sydney market and now we’ve reached that million dollar benchmark,” Dr Wilson said.

Year-on-year, the report shows median house prices in Sydney rose by $200,000 over the past 12 months and while that is one of the highest annual growth rates on record there is likely more to come.
 
City  Median House Price   Quarterly Growth   Yearly growth 
Sydney $1,000,616 8.4% 22.9%
Melbourne $668,030 3.5% 10.3%
Brisbane $490,855 0.6% 0.9%
Adelaide  $479,285 0.2% 3.3%
Perth $605,089 -0.9% -1.4%
Canberra $616,313 1.5% 5.4%
Hobart $325,972 0.0% 0.6%
Darwin  $654,270 1.6% 1.8%
National $701,827 4.3% 11.7%
Source: Domain House Price Report

“There’s plenty left in the Sydney market, we still haven’t got the full result of the May interest rate cut, investors are still wanting to be part of the Sydney action, so get ready for more price growth in Sydney,” Dr Wilson told Fairfax media.

Dr Wilson isn’t alone in his prediction of more growth for the harbour city, Rich Harvey, managing director of Sydney based Property Buyer forecasted another 12 months of solid growth.

“I believed there’s probably another 8-10% of growth for Sydney over the next 12 months, and even after that there’s just going to be a slowing of growth until it levels out, not some huge reversal,” Harvey said.

Harvey said only a sudden downturn in economic conditions caused by a sharp rise in interest rates would result in significant price correction as Sydney has the qualities needed to maintain its prices.

“The reason somebody is willing to pay a million dollars is because the demand is there.

“Sydney is an attractive place to own property, whether to live or as in investment, it has great amenities that are helping drive the prices up and they’re not things that are just going to fall away all of a sudden.”  

Sydney’s unit market also saw some strong gains over the June quarter, with a 6.6% increase to a median price $686,078.

Year-on-year, the median unit price in Sydney grew 13.9% over the past 12 months. 
 

City  Median Unit Price   Quarterly Growth   Yearly growth 
Sydney $686,078 6.6% 13.9%
Melbourne $443,549 3.2% 4.5%
Brisbane $371,508 1.0% -3.2%
Adelaide  $292,399 -2.7% 0.6%
Perth $405,417 -1.5% -2.1%
Canberra $382,350 -6.3% -6.8%
Hobart $272,932 0.0% -1.6%
Darwin  $471,789 -3.4% 3.3%
National $516,723 4.0% 7.9%
Source: Domain House Price Report
 

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