Tha pace of capital gains remains national leading across Sydney with housing values rising a further 2.6% in June, taking the typical value of a Sydney dwelling 15% higher over the financial year.

You can also check out the local reports for Brisbane and Melbourne.

House values are up 19.3% over the year, compared with a much softer 5.1% lift in unit values.

Such a significant surge in house values has pushed the median to just over $1.2 million.

With affordability pressures mounting, it’s reasonable to assume housing demand will be deflected back towards the medium to high density sector where values are a substantially lower.

The difference between Sydney’s median house and unit values has never been this wide, at a bit over $430,000.

There are some signs that some steam is coming out of the market though.

Monthly growth in dwelling values has eased back from 3.7% in March earlier this year to 2.6% in June.

Clearance rates have reduced from the mid 80% range to 70% range and new listing numbers are tracking about 24% above the five-year average, which should help to gradually lift advertised inventory levels if buyer activity slows.

Here’s what’s currently happening in Sydney

The Sydney property market is going gangbusters.

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Extremely strong demand for houses in Sydney, particularly in the inner and middle ring suburbs, is likely to lead to double digit price growth over the next 12 months. However, the demand for apartments is a little softer.

While well located, family friendly apartments in Sydney’s inner suburbs are likely to perform strongly due to increasing demand from owner occupiers and investors, apartments in high-rise towers are likely to continue to languish.

Corelogic report that since housing values found a floor in October last year, Sydney home values have risen 5.7% to reach a new record high in early March 2021.

The recovery trend in Sydney following the -15.3% decline from July 2017 to May 2019 was interrupted by COVID-19, with housing values falling by -3.0% through the worst of the pandemic.

There is broad consensus amongst economic forecasters that Sydney’s property markets will continue to surge strongly over the next few years.

Here are some of the most recent forecasts:

  • ANZ Bank forecast Sydney property values could increase 9% in 2021
  • Riskwise forecast Sydney property values could increase 8-12% in 2021
  • CBA forecast Sydney property values could increase 7% in 2021
  • NAB forecast Sydney property values could increase 7.3 % in 2021
  • SQM forecast Sydney property values could increase 7-11% in 2021
  • Westpac forecast Sydney property values could increase 14% in 2022-23

At the same time, real estate in Sydney’s larger regional locations, and in particular in lifestyle locations like Byron Bay, the Central Coast, the Hunter Valley, Wollongong, New South Wales’ south coast should perform strongly this year with beachside suburbs likely to outperform the wider overall market

Sydney is now a seller’s market

The landscape of the housing market in New South Wales has shifted rapidly from a buyer’s market to a seller’s one.

FOMO (fear of missing out) is now prevalent in those interested in Sydney real estate, but there is still plenty of growth left as Sydney property values have only just reached their previous 2017 peak levels.

The resurgence of buyer interest in the Sydney property market has meant that auction clearance rates have consistently been in the high 80% range suggesting there are more buyers than there are sellers, and this always leads to higher property prices.

More investors are getting into the Sydney market now recognising that there are no bargains to be found, and that in 12 months’ time the properties they purchased today will look like a bargain.

However, there is currently a flight to quality, with A grade homes and investment grade properties selling quickly often within days of coming onto the market.

Sydney’s Property Top Performers 2021

2020 was a challenging year for all our property markets due to COVID-19, lockdowns and a recession, however, the Sydney real estate market was very resilient.

Of course, there is not one “Sydney property market” and some segments outperformed others.

Here are some of the best of the best for Sydney’s housing markets in 2021:

NSW best performers 2020

These are the Sydney Suburbs with the top sales in 2021

highest total value on sales sydney

The best of the best in Sydney’s property markets

As Australia’s largest city, Sydney’s housing markets are vast and diverse.

These are some of the best performing segments…

best sydney suburbs to invest in

And these are Regional NSW top-performing locations.

regional NSW best suburbs to invest in
Kate Forbes
About Kate Forbes
Kate Forbes is a National Director Property Strategy at Metropole. She has 15 years of investment experience in financial markets in two continents, is qualified in multiple disciplines and is also a chartered financial analyst (CFA).
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