Following on from the second half of 2020, the property market has continued to gain momentum with prices rising and buyer demand not showing any signs of slowing down. According to Domain.com.au Sydney’s clearance rates hit a 24 year high at 88.7% on Saturday February 6. To put this into perspective we have to go back to June 14, 1997 to find a weekend with comparative clearance rate levels.
And it’s not just clearance rates on the up and up…
We are also witnessing strong increases in sale prices with new data from CoreLogic showing that house prices have reached record highs with a median price of $1,211,488 in Sydney, surpassing that of pre-COVID levels as well as the price peak of mid 2017.
As Commonwealth bank chief executive Matt Comyn recently told the Sydney Morning Herald and The Age, “The housing market has performed more strongly than we anticipated, and we are forecasting approximately 8 per cent growth in house prices during the course of the year.”
Across the board, recent results from our sales team are reflective of that reported in the media. 33 Morrison Avenue, Engadine recently sold for $1,360,000 at auction following 100 buyer groups through the first inspection and an original price guide of $1,100,000 to $1,210,000. While 99 Seventh Avenue, Jannali drew in 179 buyer inspections over 15 days and sold prior to auction for $1,578,888. Also 6 Wollun Street, Como set a new record for a non-waterfront property in Como, selling at auction for $2,371,000.
You can view all our recent sold properties here.
Contributing factors to the rise in clearance rates and sale prices
One of the driving factors behind the current rise in prices and clearance rates is the lack of available properties on market. The total number of properties for sale has consistently been below 600 over the past 6 months, which is less than half the number typically available in the Sutherland Shire. A shortage of stock, paired with more people choosing to stay in their home’s means buyer competition is at an all time high as the fear of missing out has once again set in. Adding to the above, historically low interest rates which according to the latest from the RBA (Reserve Bank of Australia) are not expected to increase substantially till 2024, as well as relaxed lending laws further explains buyer behaviour.
First home buyers have been active with many keen to take advantage of the government backed initiatives whilst they are still available. Others are equally keen to get a foot in the door and take advantage of the predicted price increases as 2021 progresses. We also expect to see investors returning to the market as cheaper finance and rising prices draw them back after a subdued showing in 2020. Claudio Mazarella, ME’s head of loans and personal banking recently stated that, “We fully expect to see property investors back in full force this year…Sentiment within this group is bouncing back, with low interest rates making investing in property a more attractive option.”
If you are looking to invest in property, the local rental market is performing strongly. Prices for family homes in particular are on the rise with a reduced supply of larger properties to rent and an increasing number of families needing to secure a rental. The unit market has stabilised, however we have noticed a higher supply of 2-bedroom units which is giving prospective tenants plenty of choice.
“Upgrading or making improvements to your rental, particularly if it is a unit, can assist in making it stand out from the crowd and attracting the ideal tenant. New paint, flooring, the addition of air-conditioning, built in robes and a dishwasher are little things that can often make a big difference.” Rachel Fowler – Business Development Manager
Recent leases include 9 The Circle, Jannali, a two-bedroom renovated house which was leased after the first open for inspection for $620 p/wk. Similarly, 66 Georges River Road, Jannali leased for $670 p/wk after 11 groups through the first open and 5 applications. Looking at the unit market, 21/55 Auburn Street, Sutherland leased during the first week on market for $480 p/wk and 32/60-66 Linden Street, Sutherland also a two-bedroom unit for $420 p/wk.
For a free assessment of a current investment property or for assistance with determining the suitability of a potential investment property, feel free to reach out to our Business Development Manager, Rachel Fowler.
What does this mean for those looking to sell?
We’re arguably witnessing the strongest market conditions for sellers in over 3 years. It is also evident from speaking to buyers that after spending the better part of 2020 at home, as well as changes in the way we live, many are looking for a home that offers their ideal lifestyle. Working from home arrangements, work/life balance and access to transport are high on the priority lists with people wanting a home that provides them with everything they need under the one roof. Even in a seller’s market it is still important to have realistic expectations around the price you hope to achieve and to have your property looking its best. Taking the time to make small improvements or minor repairs along with organising pest, building and strata reports prior to listing will go a long way to helping you achieve your ideal price.
If selling is something you have been considering it could be worthwhile taking advantage of the current market conditions. To chat more about your situation and goals, contact our team today. We would be more than happy to assist you further.
Want to take the conversation further?
Why not call us on 02 9528 9299, email us or fill in the below form to book a free property appraisal.
We have received your information and will be in contact shortly.