Everybody’s talking about the strength of the Sydney property market (which makes a nice change from two years of doom and gloom). There are almost daily headlines telling us that the auction market is “the strongest in a decade”, that properties are running out the door days after being listed, and that Sydney house prices are increasing by “$500 a day”.
While the headlines undoubtedly sensationalise the situation, the truth is that the property market is the strongest it has been in a long time and looks to continue that way for a while at least. Auction clearance rates are at record highs (over 80% week after week) prices are rising (jumping 2.5% last month and 5.2% over the quarter), and buyer activity and housing market confidence has increased markedly. That familiar anxiety is back – first home buyers worry that they will never get into the market; would-be sellers worry that if they sell before buying, the market will move too quickly for them. There are many frustrated and increasingly desperate buyers out there and consequently some fantastic results for vendors. Investors, particularly self-managed super funds, are leaping back into the market with gusto.
We’ve had some fantastic results in recent weeks. Of note, we sold a fully renovated semi in North Bondi for $1,835,000, way over the reserve. The same property failed to sell in 2012 for $1.65m. On the same day, and prior to auction, we sold two one bedroom units and three retail shops to the same purchaser for a great price. The vendor had originally listed just the two units, but was able to secure the sale of all five properties.
There is the inevitable speculation of a “housing bubble”, with SQM Research recently forecasting Sydney home prices could surge by 15-20% in 2014 on top of 9-12% growth this year. Almost all economists and the Reserve Bank agree, however, that such talk is premature and alarmist. Recent price rises appear to be sustainable given our historic low interest rates, strong buyer demand and limited supply, and several prior years of decreasing home values. Tim Lawless, RP Data Research Director, describes it as a “technical recovery” after combined capital city values fell 7.4% from October 2010 to May 2012.
So, if you’ve been thinking about selling – now is a good time, and we’d love to hear from you! There’s only a short window if you want to sell this year, otherwise you’ll be looking at early 2014.
Hart Estate Agents is a boutique agency specialising in eastern suburbs property. Our award winning team provides the full range of real estate services. Click here to find out more. Click here to contact us. Sign up here to receive our news and views straight to your inbox.