Real estate investments in Sydney: all what you need to know before you invest
Buying an investment property in Sydney, as Australia’s largest capital city, offers an opportunity to invest in a truly global city. The New South Wales capital continues to draw tourists from across the globe with its spectacular beaches, scenic parklands, luxurious urban facilities and varied economic opportunities.
Sydney’s economy remains a regional leader, driven by a number of industries including banking, education, construction, technology, healthcare and more. Data shows that Sydney alone usually accounts for a large share of the economic growth of the country.
Furthermore, with the significant multibillion-dollar development plan for the nation, Sydney is poised for a genuinely prosperous future that will keep high demand for land.
It is divided into several submarkets by geographic price points and form of property – this means you can’t just buy any property and rely on the general demand for Sydney property to do the heavy lifting over the next few years, so careful selection of property would be key.
With all the talk of a massive upturn, the turnaround pattern is more focused in the housing market’s premium end, where prices had previously declined more rapidly.
The market’s top quartile is up 6.9 percent over the past three months and 10 percent higher over the year, while lower quartile prices were 3.2 percent higher over the quarter and just 3.4 percent higher over the previous year.
Well-placed “A Grade” homes and properties with an “investment rating” sell well, but secondary properties do not sell until vendors drop their prices to suit the demand.
Domain recorded the biggest annual rise in Sydney’s inner west, up 15.4 percent in the last quarter of 2019 – adding $225,000 to its median house price, now $1.69 million.
Land prices changed by 13.6 percent in the northwest and property at the lower north shore rose by 13 percent in the last quarter of 2019.
According to Domain ‘s senior research analyst Dr Nicola Powell, with house prices now just 4.6 percent below the mid-2017 peak and unit prices 6.2 percent lower, households had regained nearly two-thirds of the value lost in only two quarters during the 18-month downturn.
So I’m going to discuss the nitty-gritty behind Sydney ‘s business dynamics, the places where long-term development is still possible, and the effect of changing demographics on the city’s potential success to help give you a deeper understanding of what is really going on.
Analysis of the property market in Sydney
Australia’s largest real estate market is on the move again having reported its fastest turnaround in decades.
After the end of the May 2019 election, Sydney residential prices have recovered by 11.2%.
Sydney house prices fell by 1.5% over the month of January 2020 (6.7% over the last quarter) while apartment values rose by 0.3% over the last month (3.2% over the last quarter).
At the current growth rate we are likely to see the prices of Sydney real estate reach new peaks in the first half of 2020.
Real estate investment in Sydney: are you ready to start?
As with most real estate stuff, the answer is – it depends. Although some areas still have strong growth ahead, it is important to avoid some other submarkets like the plague. The rebound is more concentrated in the housing market’s high end, where prices previously dropped more rapidly.
Is it a good time to invest in Sydney property?
Over 2020–21 house prices are forecast to rise across all Australian cities. The combination of lower interest rates, easing lending serviceability buffers and improved economic growth is expected to attract buyers and investors famous to the property market in 2020.
While there will be plenty of opportunities for home buyers, it’s still the most difficult lending environment that the market has seen in 20 years. Investing in a property isn’t hard, but doing so in today’s market takes a different mindset. Thinking in terms of a growth mindset rather than a minimalist way of thinking and taking control of your finances will provide you and your family with a more successful investment and financial life.