After falling more than 15% in 2018-19 the Sydney property market has made the strongest recovery in modern history.
In a recent housing update, Westpac gave the following summary plus forecasts for the Sydney real estate market…
The upturn evident in NSW three months ago is now well entrenched with prices rebounding strongly, the Sydney auction market humming, sales recovering and listings starting to tighten.
Buyer sentiment points to more strength ahead although the pace of the rebound may slow.
More generally, the market is still in recovery mode – despite strong gains, Sydney prices are still 8.5% below their peak and sales remain low by historical standards.
The price detail continues to show broad-based gains with a similar lift for units and houses, the latter having seen more weakness through the 2017-18 correction.
Properties in the bottom tier have underperformed slightly.
The sales-listings balance has swung sharply with sales now tracking ahead of new listings and the total stock of unsold properties down to 3.8 months of sales compared to 5.4 months in late 2018.
While listings still suggest conditions are more difficult for units, both units and houses have seen similar improvements since mid year.
The NSW Consumer Housing Sentiment index has risen further since August although component moves have been more mixed and the ‘pulse’ from the annual change has softened a touch (note that in chart 23 and similar charts for other states both the index and turnover are shown in annual change terms rather than levels).
Resurgent price expectations are now the main driver, partially off set by softer reads on ‘time to buy’ and unemployment expectations – suggesting affordability and job security are becoming constraints.
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