While Sydney has recorded strong capital growth over the past five years, its long-term performance pales in comparison to smaller capitals, according to the latest analysis by the Property Investment Professionals of Australia (PIPA).

PIPA—which analysed data from the 2002-2017 Australia Bureau of Statistics Established House Price Index—showed that in terms of capital city house price growth, Sydney finished dead last. 

The Harbour City’s house price index has increased a mere 142% over the past 15 years, compared to first-place Hobart, which recorded growth of 220% over the same period.

Melbourne came in second (208%), Darwin third (161%), and Brisbane fourth (160%).

Peter Koulizos, Chairman of PIPA, said the research reinforced the notion that successful property investment is all about long-term results, rather than short-term gains.

“Educated investors understand the importance of time in the market, not trying to time the market, which is really just speculation by another name,” he said. “An issue that PIPA had during Sydney's recent growth run was we knew its market had done very little for the best part of 10 years beforehand.

“So it was the sign of a normal market cycle, not a bubble that threatened real estate prices across the country.”

Koulizos added that it was vital for homebuyers, investors, and the federal government to understand that Australia did not possess a monolithic property market, but consisted of numerous markets in various stages of the cycle.

Many savvy buyers recognised that value for money could be found all over the country.

“The latest interstate migration figures highlight this with many Sydneysiders opting to relocate to more affordable locations,” Koulizos said. “Likewise, Hobart's position at number one in the results is further evidence that affordable property is on the radar of investors who generally opt for lower priced real estate.

“Similarly, PIPA has always said that the strong price growth in Sydney was driven by emotional owner-occupiers and not the vast majority of investors who can only afford to buy one or two properties in their lifetimes.”

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