Unless you’ve been hiding under a rock, you’ll know that the Sydney property market has enjoyed a dramatic change of fortunes in 2013. Throughout 2012 and early 2013, we (and many others) pointed out that the underlying fundamentals of the economy were strong and the only thing standing in the way of a strong property market was confidence and perception.
The last six months have seen buyer attitudes transform completely. Particularly at the lower to middle end of the market, buyers increasingly feel that the market is running away from them and are going crazy to secure properties, often at prices well over vendor expectations.
Auction clearance rates are at record highs, despite continued high volume up until mid-December. In some price categories prices have risen 20% over the past six months. We auctioned numerous properties around the $1-2 million mark in late 2013, and in each case, we achieved results well beyond the reserve and far higher than vendor expectations.
One of the major drivers at this end of the market is the strength of investor demand, particularly from self-managed super funds. People have really taken to the idea of gearing up their funds to buy property and in many cases are outbidding home buyers
There are some clouds on the horizon. These include the threat of higher unemployment and continued instability in global financial markets. Further, the strengthening of the market has been patchy. The $2-5 million range, while certainly stronger than this time last year, has not increased nearly to the extent enjoyed at the lower end. The result is that buyers in the upper range seem to be getting much better value. Time will tell whether this is sustainable.
What will 2014 bring? Assuming the clouds stay away, more of the same. The buyers are still there and will be keener than ever after the summer property drought. Auction volumes are likely to remain high as vendors who put off selling when the market was flat are motivated to put their properties to auction. We have a terrific line up of properties in early 2014, and we’re expecting to continue our record of excellent results.
Hart Estate Agents is an award winning real estate agency specialising in Sydney’s eastern suburbs. Click here to find out more about Alex Hart and see his listings. Click here to receive more articles like this straight to your inbox.