Sydney’s property market enjoyed a whirlwind of activity over the pandemic-era as cheaper borrowing caused a boom in demand at a time when supply was scarce.
And it was the cities with a clear lack of available properties to purchase where prices rose the most rapidly.
A recent report on the holding periods of residential property buyers in NSW, conducted by economists for NSW Treasury and KPMG, revealed that the median holding period of property buyers in NSW is 9.7 years for houses and 7.9 years for units.
Separate Corelogic figures show that longer hold periods typically result in higher nominal gains.
Nationally, properties that sold after being held for at least 30 years had median gains of $781,750 in the March quarter.
So with many properties only coming on the market once per decade (at most), it’s easy to see why supply is so tight.
And there are some Sydney suburbs where those hold times are significantly longer.
In fact, recent data by Corelogic reveals the top 10 Sydney suburbs where homeowners hold onto their properties the longest.
10 most tightly-held Sydney suburbs for houses
For houses, the affluent suburb of Yowie Bay in Sydney’s Sutherland Shire came out in top spot with a median hold period of an impressive 22.8 years.
And that’s 9.4% lower than last quarter and 4.1% lower year-on-year.
And the suburb’s tight supply and waterfront views account for its $2,157,196 median house price.
The waterfront suburbs of Malabar, Tennyson Point and Berowra were also in the top 10 tightly held suburbs for houses.
Sydney’s south-west neighbourhoods of St Johns Park, Bonnyrigg Heights and Campsie also made the list, all with median hold periods of at least 18 years.
And when it comes to property prices, all these suburbs have a median in excess of $1 million, with the exception of Bonnyrigg Heights with a $971,475 median.
10 most tightly-held Sydney suburbs for units
Point Piper in Sydney’s exclusive eastern suburbs, where the median unit value is an impressive $2.89 million, takes the top spot as Sydney’s most tightly held suburb thanks to its 13.9 year median hold period.
Russell Lea, a small suburb in the inner-west of the city, comes in second place with a $1.005 million median and also a 13.9-year median hold time.
Abbostford, also in the inner west, came in a close third place with a 13.3-year median hold time for its $1.31 million units.
Suburbs with more home buyers and fewer investors typically had longer median hold periods, said Eliza Owen, CoreLogic’s head of research for Australia, particularly areas that were popular with families or an older demographic.
A key takeaway
As always, these tightly-held suburbs aren’t necessarily the suburbs I would recommend investing in.
That’s because when it comes to property investment, it’s most important to look for an investment grade property in the ‘right area’ rather than chasing ‘hotspot’.
But even before looking for the right location, make sure you have a Strategic Property Plan to steer you through the upcoming challenging times our property markets will encounter.
You see…property investing is a process, not an event.
Things have to be done in the right order – and selecting the location and the right property in that location comes right at the end of the process.
Fact is, the property you will eventually buy will be the result of a sequence of questions you will need to ask and answer and a series of decisions you’ll need to make before you even start looking at locations.
Long before we talk about a property or the right location with our clients at Metropole, we look at factors including their age, their timeframes, and the desired end results in other words, what do they really want the properties to do – are they looking for cash flow, capital growth, or a combination of both.
And that’s because what makes a great investment property for me, is not likely to be the same as what would suit your investment needs.
So at Metropole it all starts with helping our clients formulate a Strategic Property Plan which takes into account their surplus cash flow position, their risk profile (for example would they consider undertaking renovations or small development), whether they currently own a home or are wanting to buy a new home or upgrade their existing home in the future, if they are going to earn more income in the future, or if they’re going to decrease their family income because they’re having a baby, how many other investment properties they own, where they are located and how they are performing plus 35 other considerations.
So whether you’re looking to buy a new home or an investment property and you want more certainty and direction in these interesting times, my recommendation is to sit with an independent property strategist to formulate their plan.
It’s just too difficult to do on your own and I’ve found most investors tend to be too emotionally involved to see their situation objectively.
If you’re a beginner looking for a time tested property investment strategy or an established investor who’s stuck or maybe you just want an objective second opinion about your situation, please leave us your details here and we’ll be in contact and give you more details about how to book a Strategic Property Plan Consultation.
