Market Report: Sydney property’s conflicting trends
Sydney property headlines in 2022 have left everyone feeling conflicted.
The market is good. It’s bad. It’s shifted again.
At BresicWhitney, we’ve always seen Sydney as more than a one-speed city. It’s a market of specific property trends, unique pockets, little spikes in buyer activity.
So with October done and two thirds of spring away, what’s really been happening? Our Market Report dug up some key trends and patterns.
Buyers have limited choice
We’ve been saying listing volumes have been low for some time now. This message has gone against wider media commentary that spring would bring an influx of homes and more people would be looking to sell to reduce household debt. That did not happen.
The CoreLogic numbers show just how scarce things were last month. For five consecutive weekends in October, the number of scheduled auctions was significantly down across Sydney (and the combined capital cities) compared with 2021. See number of auctions below:
Combined capitals 2021 vs 2022
- Oct 1 – 1916 vs 1613
- Oct 8 – 2708 vs 1799
- Oct 15 – 3000 vs 1815
- Oct 22 – 3019 vs 2155
- Oct 29 – 3546 vs 1908
Scheduled auctions down 35%
Sydney 2021 vs 2022
- Oct 1 – 753 vs 489
- Oct 8 – 825 vs 686
- Oct 15 – 916 vs 667
- Oct 22 – 974 vs 639
- Oct 29 – 1151 vs 762
Scheduled auctions down 30%
We had numerous Bresicwhitney owners eying off these numbers last weekend, knowing that 762 auctions across Sydney (when the previous year delivered 1151) was a healthy environment to be selling in.
Strongest pocket of the month
Last month we saw particular vigour in the Balmain market, being one area of the Inner West that was outperforming others in terms of energy.
Of the 71 properties Bresicwhitney sold in October, 13 of those came from the Balmain Peninsula with plenty of those homes in the luxury/prestige space. While the number of listings was up, so too was the appetite from buyers of trophy homes.
Many of the competing bidders came from nearby Hunters Hill or Annandale, with Paddington and Woollahra buyers also in the mix, highlighting the fact that the 2022 market has further blurred the lines between traditional regions and suburbs.
With buyers spreading out across more regions, BresicWhitney CEO Thomas McGlynn said the pattern was more pronounced because of the undersupply of quality property in spring.
“People are shopping more by category of home and traversing their way through numerous pockets of Sydney that are compatible with their way of life,” Thomas said.
“If the recent uncertainty has highlighted any big buyer trend in 2022, it’s that people are no longer wedded to particular suburbs, but rather, they’re connecting more with properties because of the lifestyle they’re going to deliver.”
Peninsula sales: $3m to $7m
Buyer activity is up
Buyers have started to connect with the idea that the property market has steadied itself in spring, seeing the current dynamic as an opportune time to re-engage. In a low-listing environment, this has delivered higher numbers through open homes.
In the last two weeks of October at BresicWhitney, we saw a 38% increase in total attendance numbers across more than 250 inspections.
More signs of wider stabilisation
With the CoreLogic price data just in for October, Sydney house prices dropped by 1.3% during the month, showing significantly smaller falls than recent declines. Nationwide, the rate of decline also slowed from 1.6% in August to 1.2% in October.
The rental crisis is growing
The ‘housing crisis’ is a headline that needs no debunking. Rental homes have become as scarce as we’ve ever seen and set to get tighter.
At the time of writing, just 26 listings were available to lease across all BresicWhitney teams, with the summer working/travel season yet to arrive. Meanwhile, rental yields have been on the rise, prompting a return of investor confidence despite interest rate concerns.
Keeping an eye on this
It would be premature to call a wider market recovery, with the effects of interest rate hikes still flowing through, and potentially more rate rises ahead. With the RBA adjusting the cash rate up 0.25% to 2.85% yesterday, we’ve now seen seven hikes in as many months.
As more borrowers come out of fixed-rate mortgages in the coming months, it could be something that affects our marketplace.
To be continued…
There’s no denying that the 2022 market has been full of twists and turns, with indicators of both boom and bust. With one month left in the spring selling season, we’ll continue to bring you our synopsis in real time.
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