As property prices continue to plummet, the city loses its crown as Australia’s top market
Sydney has gone from being one of the strongest property markets in Australia to one of the weakest, and this is affecting national prices.
“Sydney’s housing market has become the most significant drag on the headline growth figures,” says Tim Lawless, head of research at CoreLogic.
“The city’s annual rate of growth is now tracking at just 3.1%, a stark difference to the recent cyclical peak when values were rising at the annual rate of 17.1% only seven months ago.”
The results of the recent ANZ/Property Council Survey also indicate that Victoria has overtaken NSW as the property market inspiring the highest level of confidence.
The report notes that confidence in the property industry fell by nine index points in the year leading up to March 2018. Therefore capital growth expectations and expected construction activity are at their lowest since the survey was first conducted.
While the state property market is still maintaining a strong economy with a positive future ahead, the government does need to put into effect policies that can build confidence back up.
Down but not out
For Michael Yardney, CEO of Metropole Property Strategists, Sydney may be experiencing a downturn, but it is not going to collapse.
“There are still a number of growth drivers, including a strong economy, stunning jobs growth – around 140,000 jobs were created [in 2017] – and population growth supporting continued property price growth over the next few years, albeit at a slower pace,” Yardney explains.
While most of the migrants coming into Sydney start out as tenants, they are expected to become homebuyers in time.
“I expect the value of well located Sydney properties to be higher at the end of 2018 than they are today, meaning the current shift from a seller’s market to a buyer’s market is offering homebuyers and property investors with a long-term focus a window of opportunity to get into the market before it starts rising again in the second half of the year,” Yardney concludes.
SUBURB TO WATCH
BELMONT: Smooth sailing in tourist spot
In the Lake Macquarie area, the suburb of Belmont is a picturesque spot near the shore that offers sun, sand and market growth.
House prices increased by almost 20% in the period December 2016–December 2017, and the median value is just shy of $600,000. Meanwhile, unit values rose by 14%, generating a median of almost $450,000.
Belmont draws much interest as a tourist destination, with a thriving food scene and the beautiful 9 Mile beach. Watersports are popular here, and the Belmont Bay foreshore is a great spot for picnics and recreation. Belmont Wetlands State Park is located here, and in addition to being home to a fi ne collection of birds, it has walking and cycling trails.
Tourism: Belmont is known for its beach, water activities, food and recreation
Growth: The house market recorded 18.5% growth in the past 12 months
Can you afford to buy in this suburb? Find out how much you can borrow
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