Sydney Poised For Stronger Outcomes As Market Sentiment Lifts
We have delayed our update of the Sydney Hotspots report this year, because the market has been awash with uncertainty. Now, with the Federal Election out of the way and the changes by APRA and the RBA in the system, we can see clear air.
We're glad we waited. July and August have recorded a growing body of evidence of recovery in Sydney markets. Clearance rates have steadily improved and the price data from multiple sources suggests the downturn has bottomed.
Our Winter survey of sales activity and prices delivered similar conclusions. It pinpointed the bottom of the Sydney trough. It also highlighted a high degree of resilience, with steady markets outnumbering declining ones, keeping in mind that much of the data pre-dated the post-election fightback.
The price data has been mostly, but not totally, negative - with the top end of the Sydney market continuing to show growth.
Our Winter survey found only four suburbs where sales activity was trending higher, but there were 61 suburbs with steady, consistent sales and 107 plateau markets (where activity had dropped from the peak but remained at solid levels).
And there were 72 suburbs classified as decline markets (up from 61 in the previous survey) and 13 which we regard as danger markets. The Sydney City, Parramatta, Bayside and Canterbury-Bankstown LGAs head the list of markets to avoid.
Our analysis of 415 suburban markets in the Greater Sydney Area shows that 87% of them have median prices lower than a year ago, while 13% have higher prices. There are only 54 Sydney markets where prices have not fallen in the past year.
That includes 24 markets where median prices have risen by more than 5%, led by the top end of the Sydney market. Suburbs with median house prices above $2 million have recorded trend-defying growth, including Bellevue Hill (up 6%), Vaucluse (24%), Collaroy (22%), Abbotsford (15%), Neutral Bay (20%), Bondi Beach (up 9%) and Kensington (up 6%).
Suburbs with median house prices between $1.5 million and $2 million showing growth include Burwood (up 10%), Camperdown (up 12%) and Lilyfield (up 7%).
Our latest Top 5 Sydney Hotspots covers the best of these markets - some top end areas that have shown resilience over the past year and look set to deliver strongly as Sydney overall recovers, and some of the more affordable locations that are poised to benefit from major infrastructure projects.
We think the timing is right to dive back into the Sydney market with our latest Top 5 Hotspots report.