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Recent Buying Selling Lifestyle Investor Tenants
Buying Selling Investor

How will the Sydney property market perform over the next year?

06-Dec-2018
Written by David Newton
It’s been the topic of conversation for a good part of the year and the question buyers and sellers are all wanting to know…what is the property market doing and will prices drop further? It seems everywhere we look there is another story headlined ‘Property Market Prices Plummeting’, which is leaving both buyers and sellers nervous and confused if they are being fed the correct information!

We recently read an interesting article on Domain.com.au which detailed how they predicted the Sydney Market to perform over the next year. Their forecast is that Sydney house prices will be close to unchanged in the year to December 2019 after falling by about 8 per cent in 2018. They expect prices to grow modestly in 2020. House prices are predicted to fall by about 12 per cent from their peak of almost $1.2 million in June 2017 to a predicted low point of just above $1 million in mid-2019. At this low point, Sydney house prices will be back at their mid-2016 level.

They went on to note that Sydney unit prices are expected to be more resilient than house prices. Unit prices are expected to fall by about 3 per cent over the year to December 2018, but then prices are expected to grow modestly over the next two years at about 3-5 per cent. Sydney unit prices are predicted to fall by 6 per cent from their peak of $769,000 in June 2017 to their lowest point of about $720,000. At this low point, Sydney unit prices will be back at their late-2016 level.





You can view the full report here

Keeping in mind this is just a forecast from Domain, it’s extremely hard to know which direction to choose if you are considering selling or buying a property. With over 30 years’ experience working in the property market, David Newton says, ‘If you’re waiting for the bottom of the housing market then I wish you the best of luck. It’s certainly more luck you will need than anything else. In 30 years in real estate I’ve never met anyone who can accurately predict the top of the market or the bottom at any particular point in time. Sure, it’s easy to see a trend in prices 6-12 months after the fact but no one knows when they are at a particular point in the market when they are actually at that point. What will happen is that the current “smorgasbord” of properties will subside and the good ones will get harder to find. In fact I’m starting to hear this from many buyers already.

David goes on to mention, "It’s the same with any investment, it always comes down to the fundamentals – supply and demand. Supply is great right now so you have choice of the property that suits your needs. Yes is likely cheaper than it was this time last year and will its value fall in the next 6 months? Who knows for sure but unless you’re buying it to sell in 6 months’ time then it doesn’t matter. So you have to make a decision in this market, do you want the choice of the right property for your needs or do you want to wait for the statistical proof that the market has “bottomed out” 6 months ago?"

Here is what we know so far: (as at 1st December 2018)
• Property values in the Shire have grown over 100% in the last 10 years, more than 60% in the last 5 years
• Property Values in the shire have come down 6-12% in the last 12 months depending on the location and type of property and subsequent demand.
• Confidence in any investment is low. The share market has dropped 8% in the last 6 months (All Ords). Bank deposit rates are at all-time lows
• Demand for Shire property is still strong, why would you want to live anywhere else?
• Everyone needs to live somewhere. No we don’t “need” Telstra Shares, Bitcoin, or even a big bank balance but we do need a place to live

Our team all have experience working in changing market conditions and are available to chat to at any time if you are considering buying or selling and would like advice.

SOURCE - Article references information from Domain.com.au

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