Northern Beaches rising buyer demand drives Greater Sydney to strongest Sydney market: Hotspotting's Terry Ryder
EXPERT OBSERVER
Six months ago it was hard to find any suburbs across the Greater Sydney Area with rising buyer demand, but now there are many. It’s been a sharp turnaround – but an uneven one.
Overall, this is the strongest Sydney market I’ve recorded in the five years that I’ve been conducting quarterly surveys of sales activity and price trends.
Our Winter 2019 survey pinpointed the bottom of the Sydney trough and our latest survey, now under way, provides strong evidence of the market revival, showing just how much has changed since the middle of last year.
Locations with rising markets, as measured by sales activity, can be found in 22 municipalities across the Sydney metro area, but the revival is not evenly distributed. The greatest uplift is being felt at the upper end of the market and many suburbs have not yet experienced significant improvement.
The number of suburbs classified as declining markets has dropped a lot but there are still 12 suburbs with deteriorating demand – and another 12 that have that characteristic as well as high vacancies and weak prices, which we therefore classify as danger markets.
There danger markets are all locations where apartments predominate. Seven of them are in the Parramatta LGA, where high levels of new apartments have been built in recent years and vacancies remain in the 5% to 8% range in several cases.
The leading market in the Greater Sydney Area is the Northern Beaches LGA. It has nine suburbs with rising sales activity, plus six others with steady buyer demand.
Quarterly sales in Newport have been 28-36-53-64, while Freshwater and Frenchs Forest are stand-outs for maintaining highly consistently sales levels throughout the post-boom correction phase and now in the recovery.
The Inner West LGA is also performing well, with six growth suburbs and nine others with consistent buyer demand. Quarterly sales in Annandale have been 17-32-36-45-64, while Leichardt has been 59-68-77-105, patterns that will likely drive prices higher.
The Sydney City LGA has growth suburbs, but also shows the importance of not generalizing when discussing real estate in a major city. The central city LGA has five suburbs with growing sales activity, 11 with steady markets, three where demand continues to decline and one suburb which we classify as a danger market. All that diversity exists in one municipality.
Blacktown is the strongest of the outer-ring markets, with five growth suburbs and 11 with steady sales activity. Schofields continues to stand out with rising sales activity – quarterly sales over the past two years have been 64-82-99-105-120-150-196-162.
Other LGAs with three or four growth suburbs include the Hills Shire, Ku-ring-gai, North Sydney and Sutherland municipalities.
This new survey also shows the recovery in the Canterbury-Bankstown area. Six months ago, 12 suburbs in this LGA were rated as declining markets, with sales levels dropping markedly. But now most of these suburbs have been re-classified as plateau markets, as sales levels start to improve. And four suburbs of the Canterbury-Bankstown LGA have shown sufficient revival to be classified as rising markets.
Across Greater Sydney, prices are reacting to the uplift in demand that is generally occurring in many locations, but most suburbs still have median prices below the levels of 12 months ago. This applies to 92% of suburbs for houses and 85% of suburbs for apartments.
But many suburbs have shown increases in the latest quarter. Examples include Mona Vale (median house price down 8% annually but up 2.3% in the latest quarter); Collaroy (down 15% in annual terms but up 9.5% quarter-to-quarter); Bronte (down 9% year-on-year but up 2.6% in the latest quarter); and Killara (down 15% annually but up 3% quarter-to-quarter).
This is a pattern I expect to see becoming increasingly prevalent as the uplift being led by the more expensive areas spreads more widely across the metro area.
Terry Ryder is the founder of hotspotting.com.au
ryder@hotspotting.com.au
twitter.com/hotspotting
PICTURE SOURCE: Alex Proimos
