Over the last year or so, Sydney real estate has been getting a significant amount of attention. This in no small part to do with the city’s property market breaking record after record in price growth, making headline figures that have caught the eyes of people both locally and overseas.
In July, the Domain Group reported that Sydney’s median house price breached the $1 million mark, putting the market in league with the likes of London and New York.
This price growth has no doubt led to property sellers enjoying massive gains off their sales. However, this has proven to be deeply discouraging for first-time house buyers in the market for homeloans. The Housing Industry Association (HIA) reported a cut in the country’s housing affordability in June, dropping by 2.9 per cent to a rating of 79.7 – well below ideal levels.
Evidently, the soaring prices didn’t come as good news for those with a struggling savings account, making it tougher for people to afford a home.
Slowdown in Sydney
However, figures from CoreLogic RP Data show that Sydney may finally be showing a drop off in momentum. In July, the city experienced a 3.3 per cent rise in housing values. The quarterly and yearly increases were respectively recorded at 5.4 and 18.4 per cent, pushing Sydney’s median dwelling price to $790,000.
A month later, dwelling values rose by 1.1 per cent – an increase, but a shrinking one at that. This was a hint that the market that was losing steam.
Finally, an October 1 release reveals that Sydney only saw a 0.1 per cent growth in median dwelling values over September – another drop. Collectively, this puts quarterly growth and yearly growth respectively at 4.6 and 16.7 per cent. This resulted in the median dwelling price landing at $785,000.
As you can see, growth in Sydney’s real estate prices has been progressively slowing down. As a home buyer, this is terrific news. If the trend continues, the property market in the city will reach stabilisation. This, combined with the influx of new buildings coming through the pipeline as reported by HIA, should have us see a rise in housing affordability. This may loosen the grip in Sydney’s property market and allow more home buyers to afford properties with their homeloans.
If you are considering a purchase, make sure you are in right position by talking to the lending professionals at Customs Bank. As we are a member-owned bank, we work for you with low fees, competitive rates and superior service.