Sydney home prices: staggering new record revealed
PropTrack figures released Friday revealed growth has remained steady across the city, with every major region recording home price rises over July – albeit at a slower pace than earlier this year.
Dwellings values across the Greater Sydney area rose 0.12 per cent for the month and are now about 3.3 per cent higher than they were at this time last year, but there was significant variance across areas.
Growth was higher in the southwest, including areas like Liverpool, as well as in the suburbs around the Sydney CBD, where prices are now 2-3 per cent higher than in May, after the last rate cut.
PropTrack economist Anne Flaherty said these seemingly small increases in percentage terms were actually substantial in dollar values given how high prices already were.
'Sydney prices are so elevated that even a 0.5 per cent increase can mean buyers paying thousands more,' she said. 'It may seem like minor increases, but buyers are spending much higher amounts.'
Citywide the median price of a house is now $1.56 million, while the median unit price is $860,000 – both record highs.
Sydney houses are on average about $500,000 pricier than those in Brisbane, Australia's next most expensive capital, and about $580,000 more expensive than in similarly-sized Melbourne.
PropTrack noted that the slower, steadier growth over July was the result of a brutal tug of war emerging across key markets.
Low listing levels and falling interest rates heated competition for property on one hand, but this was moderated by crushing affordability constraints and economic uncertainty.
The result was a mixed market, exhibiting characteristics of boom conditions in some city suburbs but a slowdown in others.
Agents revealed demand has also been more listing-specific than usual – buyers normally gravitate more toward the best quality stock but this trend has been even more pronounced than usual.
Part of the reason is because of the makeup of the buyer pool.
Much of the activity pushing prices up appears to be coming from upsizers, who can often be more selective with their property choices. Many have been active within pricier inner suburbs.
Investors and first-home buyers, who often snap up the more dated homes or those with some drawbacks like a location on a busier road, have been less active.
The result is a situation where older housing or properties with major drawbacks are lingering on the market, while top listings in 'blue chip' suburbs are attracting extreme levels of demand, lifting prices.
Agents reported a growing fear of missing out is emerging among buyers who are wary of what impact further interest rate cuts might have.
Wilberforce resident Brady Harris, with partner Brie, is selling his home on King Rd in the hope of using the proceeds for buying investment properties. He said rate cuts were motivating the move.
'History suggests prices are going to keep going up if they cut rates again. We'd like to own more properties when this happens,' Mr Harris said.
The couple's home on King Rd will go to auction August 16 with Ray White-North Richmond agent Cindy Cash.
'It's become very hard with the cost of living to get ahead financially and we feel like property investment is one of the few ways you can do it,' Mr Harris said. 'It's just really hard to do in Sydney. It's just so expensive.'
SYDNEY'S TOP GROWTH CITY REGIONS
Sydney region 3-month growth
South West 3.89%
CBD and Inner South 2.57%
Northern Beaches 2.32%
Canterbury-Bankstown/St George 1.91%
Outer South West 1.63%
Outer West/ Blue Mountains 1.52%
Hills District 1.46%
Eastern Suburbs 1.35%
Sutherland 1.30%
Central Coast 1.03%
Ryde 1.00%
Blacktown 0.83%
Parramatta 0.74%
Inner West 0.09%
North Shore 0.09%
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