Sydney property boom appears over
Sydney's great property boom appears to have ended
April 24, 2014
(Translation of this article appears in Arabic section)
House-price growth has slowed this year, leading analysts to suggest the Sydney property boom is over. Following house price growth of 5.1 per cent in the December quarter, Sydney prices grew by 3.1 per cent over the March quarter, according to Australian Property Monitors.
''We've passed the peak of the cycle, now we will see a moderation in house price growth,'' APM senior economist Andrew Wilson said.
''Affordability barriers are starting to move into the market now … I think the boom is over.''
Apartment price growth has also slowed, down from 3.2 per cent in December to 2.6 per cent over the March quarter.
But Sydney property has never been more expensive with the median house price at $782,973 and the median apartment price hitting a new high of $547,053.
AMP Capital chief economist Shane Oliver said: ''I think we have seen the best of Sydney's house price growth.
''Sydney probably has peaked in terms of momentum … affordability has been deteriorating.''
Neither economist thinks prices are set to fall.
APM's quarterly data indicated that some regions had bucked the slowing trend with the lower north shore growing by 8 per cent.
In the December quarter the region grew by 5.3 per cent.
Peter Matthews, from Ray White Lower North Shore, put the growth down to improved confidence and a lack of stock.
''There has been a major shift in properties being marketed for auction as opposed to private treaty,'' he said. ''It is the power of competition.''
A two-bedroom semi at 68 Albany Street, Crows Nest had a reserve of $1,025,000 before its March 1 auction. It sold for $1.3 million under the hammer. Mr Matthews said that was one of many amazing auction results this year.
The price growth could also reflect the type of properties that are changing hands.
''Before Christmas there was a lot of interest in the market below $2 million,'' Mr Matthews said. ''Now it is the market up to $3 million that has seen a lot of activity.''
The south-west region also had a bumper quarter, growing by 5.2 per cent. But these regions were the exception with the rest of Sydney experiencing a notable slowdown.
The city and east had the biggest drop, with its December growth of 8.9 per cent slowing to 1.7 per cent this year.
Eastern suburbs agent Annie Hodgson, from Spencer & Servi First National, said she had felt the change.
''The strength of the market towards the end of last year and at the very start of this year, I mean gosh, I think we all felt that it couldn't keep going.''
The upper north shore and north-west region has also slowed considerably, from 9.2 per cent at the end of last year to 4.3 per cent over the March quarter.
Sydney's most resilient market - the inner west - has slowed from 5.9 per cent to 4.4 per cent this year.