Median house price in Sydney could pass $1 million

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While Sydney’s rate of capital growth is expected to slow in the coming year, the next 12 months could see median house prices in the city push into seven figures.

In their Residential Market Report for June 2015, Propell National Valuers estimate that over the next 12 months Sydney prices will grow by 13%, pushing the median house price from the current mark of $880,000 to past $1 million.

The 12 months to June 2015 saw Sydney prices grow by 16.3%.

Propell National Valuers economist Linda Phillips said the rise again posed the question of whether or not Sydney’s market was in the midst of a bubble.

“Just how fast do prices have to rise before we call it a bubble?” Phillips said.

“There are reasons for the growth in prices, not least a shortage of supply, and lower interest rates, but then, bubbles always happen for a reason.”

Capital growth for Sydney units is also expected to slow; the 12 months to June 2105 saw prices grow by 8.8% while on 5% growth is forecast for the next 12 months.

This would see median prices for units rise from $638,000 to $669,900.

It’s a similar story in Melbourne, with capital growth for units and houses both expected to slow.

House price growth will slow 9.8% to 8% year-on-year, with medians going from $620,000 to $669,600.

Unit price growth will slow from 2.9% to 1%, which will see a small rise in unit medians from $480,000 to $484,800.

Outside of Sydney and Melbourne, Brisbane, Adelaide and Perth will see capital growth slow over the next 12 months, while Hobart, Darwin, Canberra and Newcastle will trend upwards.

For units, Adelaide and Perth will see price growth slowdown, while Brisbane, Hobart, Darwin and Newcastle to pick up. 

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