The
housing market has been strong all year but there are some signs as winter
kicks in that this strong run, which began with the boost in the first home
owners’ grant last year, may finally be coming to an end. Some properties
are still selling at and above listed prices, especially properties worth up to
$1.5 million around the city and surrounding suburbs. However some vendors’
expectations are now too high and we are gradually moving towards a more
balanced market where buyers can have some say. It is still relatively quiet at
the 'top end' of the market but sales are steady and neither vendors nor buyers
have the upper hand in a market where the activity is very much dependent upon
the location.
The cash rate remains at 4.50%. The Reserve Bank decided to leave the rate
unchanged in June and July. Where the rate goes from here is now anyone’s
guess. The bank has expressed concern about rising house prices and inflation
and this coupled with a relatively healthy employment market indicates short
term that there may be further rises this year. However, uncertainties in
the world’s economies (including China) and the issue of sovereign debt in
Europe provide the counter argument for delaying rises in the cash rate in the
near term.
In
summary, the market in Sydney is still strong in apartments up to $800,000 and
houses up to $1.5m. Above that, activity is measured and care needs to be taken
in determining where the bargains are.
Various Statistics
The cash rate is 4.50%, up
from the historic low of 3.0% recorded between April 2009 and September
2009.
Median rents in Sydney are
$460 per week (houses) and $420 per week (units) as at March 2010.
Auction clearances in Sydney
have gradually decreased this year from a high of 81% in January down to
62% in July.
The median house price in
Sydney was $651,000 in May, up from $610,500 in January.
General
For the buyer, there is no single purchasing strategy at the moment. (Yet
another reason to use a buyers' agent). There are not many bargains out there
at the moment, due mainly to lack of supply in many suburbs. In fact, in
a number of suburbs, the strategy is to identify the 'fair' price now and
purchase, because waiting for the bargain will only cost money in the long run.
If you have been thinking of buying (especially if you are an expat, new to
Australia or first homebuyer) then, in most cases, now is a good time to get
moving in the Sydney market. There is a gradual growth in rents due to an
underlying shortage of properties, Government continues to support the property
sector, investors have returned to the market in the past couple of months and
there is a steady, but gentle, growth in most areas of the Sydney market.
Sydney Auction Results 14 August 2010 Total
properties:238
Sold:170
Withdrawn: 17
% Cleared:67%
Median:$790,000
