As Australia's capital cities recover from Covid-19 lockdowns and restrictions, Sydney's property prices continue to soar.
The market has witnessed house prices increase by a staggering 30.4% in the past year, with a current median price of $1.5m. However, things have begun to slow down with the monthly rate of growth more than halving since March 2021.
According to CoreLogic, property values rose 1.5% in October and are now 23.8% over the year, providing sellers with a gross yield of 2.4%. The current median value for homes surpassed $1m in June and has further advanced an additional $15,500 over October.
The gap between the median house and unit value in Sydney is now close to $500,000. The average house price in Sydney is $1.33m, making apartments the more viable option for many with prices averaging $837,000.
Buyer demand for off-the-plan Sydney apartments is at its highest level in four years. Off-the-plan sales tracked by Urbis show that 15% of apartments available for purchase exchanged over the quarter - the highest sales rate in Sydney since 2017. This is almost double the 8% figure recorded in the second quarter and nearly four times higher than the 4% sales rate recorded at the start of the year.
Shane Oliver, Chief Economist of AMP Capital, says, "My forecast is that prices will peak sometime in the second half of next year, around September onwards." CBA predicts Sydney house prices are poised to drop by 12% by 2023, as the RBA takes the cash rate to 1.25%. This prediction is in sharp contrast to ANZ, which predicts Sydney dwelling prices to fall by 4%.
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