“Predictions for the prestige properties’ market in Sydney 2010…”
National housing prices have increased by 1.8 per cent in January with Sydney prices rising by 1.7%, the RP Data-Rismark Hedonic Home Value Index reveals. Although based on a small sample of sales due to the summer slowdown, the increase is the result of growing consumer confidence and the strengthening economy driving up prices for prestige properties in early 2010.
According to RP Data’s National Research Director Tim Lawless, a number of positive market indicators during January suggest that the residential market has started with confidence with a revival in high-end exclusive properties driving up property sales.
However, Lawless suggest that while the market has started on a high, the residential market more buoyant market conditions and double digit growth in 2009 may start to moderate to more realistic single-digit levels in 2010.
According to most commentators, there will be fewer first-home buyers but more investors, expatriates and bank executives back in the market will push up prices in the prestige property market in 2010.
As demand declines in the first home buyers market, the removal of the grant boost, rising migrant population, lower vacancy rates, increasing interest rates and the strong economy will result in prestige properties over the 2 million mark likely to have recovered to their pre GFC (Global Financial Crisis) prices by late 2010.
SQM’s forecast is that national residential real estate will rise between 4 and 6 percent for 2010 with BIS expects Sydney’s median house price to rise by about 7 per cent during 2010, as strengthening investor demand offsets the smaller number of first-home buyers.
“This will represent slower growth than last year’s 12 percent, due to the scaling back on the First Home Owner Boost and rises in interest rates,” Louis Christopher, managing director of SQM Research told Money Magazine.
“Over history, house prices have risen in line with GDP growth plus inflation (or nominal GDP).
Sydney house values recovered in the second half of last year, with the median house price of $595,000 exceeding the previous peak of $568,000 in February 2004.
Among Sydney’s most actively traded suburbs, just 270 suburbs of 500 now have median house prices higher than their 2004 median price, according to Australian Property Monitors.
The chairman of Aussie Home Loans, John Symond told the Sydney Morning Herald in February that with bankers and high powered executives getting back into the market, the recovery will be strong for prestige properties in Sydney.
”The recovery at the top end of the market is coming from executives who are in the financial service sector, which is now again producing bonuses for their higher discretionary expenditure,” Mr Symond said.
But BIS Shrapnel advised the Sydney Morning Herald that the more expensive suburbs might underperform.
”Corporate profitability is important as it drives income for many households, and we expect profits to remain soft in 2010 – so the fundamentals will probably remain less supportive when compared to the undersupply pressure, which will play out more in the outer ring suburbs,” BIS economist, Jason Anderson, said.
The RP data report also shows values rose by 2.4% for the three months ending January, but rental yields have declined.
“We are beginning to see the first signs that the softening of yields is slowing and, in some cities, yields are now beginning to improve.”
“Withrental demand likely to be higher during 2010 due to continuing strong migration and fewer first home buyers, we anticipate that rents and consequently yields, will improve over the year,” RP Data national director Tim Lawless said.
Estate agent and buyers’ agents in Sydney sense local buyers are now competing for property along with occasional expatriates in the prestige property market. With the relaxation in foreign investment rules, the strong economy and increasing number of expatriates buying property in Australia, prestige property prices are likely to have recovered by Christmas this year. Contact Amanda who is a buyer’s agent in Sydney to secure your waterfront, exclusive or prestige property in Sydney.
Amanda On My Side offers exceptional buyers agent services throughout Sydney and across Australia. Engage a professional real estate buyers agent to help you find the best property at the right price. Buyers agents, also known as property finders or a buyers advocate, can help find, research and bid on your next home or investment property. Need a buyers Agent Sydney – then you need Amanda on your Side.
Tags: Exclusive Properties Sydney, Prestige Properties Sydney, Waterfront Propertie
