An Overview of the Sydney Property Market (and Where to Start)
Sydney property prices are tipped to decline by up to 10% over the next 12 to 18 months.
After nearly a decade of unchecked growth, it seems that 2018 is finally the year for newcomers to crack the notoriously difficult Sydney property market.
Sydney is receiving rising global attention for its stable economy, world class health care, education, magnificent harbour, pristine beaches and clean air. Historically, Sydney has been separated from the rest of Australia in terms of property values by the demand for residential housing, strong economy, rising population and chronic shortage of housing. However, thanks to Government incentives and the trend to ‘knock down rebuild in Sydney’, entry-level buyers are taking advantage of the current market, and making their homeowner dreams a reality.
Areas of Growth
If you are an entry-level investor or first home buyer, there are a number of new growth suburbs which have benefited from improvements to local infrastructure and amenities. These growth hubs including Liverpool, Blacktown and Greater Parramatta, are relatively affordable, offer an increasingly attractive lifestyle, and are quickly becoming the go-to for savvy first home buyers.
Eastern suburbs including Surry Hills, Randwick, Kensington and Kingsford have all benefited from the improved local transport options, thanks to a light rail line linking the city with the University of NSW. Other suburbs including Wolli Creek, Marrickville, Erskineville, Green Square and Ashfield offer affordable home options, and are within 1 to 5 stops of the CBD.
A near record $72.7 billion in new infrastructure will be spent over the next four years in NSW, including Australia’s biggest transport project, WestConnex. By taking 25 minutes off the Parramatta-CBD Commute, WestConnex will bring western Sydney closer to the CBD than ever before. This is a crucial benefit, given its tipped that more than half of Sydney residents will live in western Sydney by 2026.
Unit or House?
The age old Unit vs House debate is particularly prevalent in the thriving Sydney market. Nearly 10,000 apartments will be built in Sydney’s newest suburbs in the next four years to satisfy investor demand, joining the record 213,000 new home starts across the country. The median price of an apartment in Sydney is currently $732,321 while a house is $1,167,516. However, houses have tended to outperform units in the Sydney market, though they do have a higher entry price. This makes apartments a more affordable first investment.
Where to Start?
In 2017 the number of first home buyers entering the market in NSW was up 59 per cent, thanks to Government concessions, low interest rate loans and other flexible payment options. If you are looking to enter the Sydney market, its important to begin by developing a clear overview of your financial health, and what incentives and concessions may apply to you.
The First Home Owner Grant in NSW: Provided by the NSW Government, the first home owner grant recognizes the difficulties that are faced by first home buyers attempting to enter the market for the first time. The grant applies only to those buying new homes, and provides eligible purchasers with $10,000 to be used to purchase or build a new home.
First Home Buyers Assistance Scheme:
The First Home Buyers Assistance Scheme offers first home owners exemptions or concessions on property transfer duties.
This includes an exemption from stamp duty for homes valued up to $650,000 and concessions on duty for homes valued between $650,000 and $800,000.
Sydney has long been one of the hottest property markets in Australia. With the availability of house and land packages and a number of affordable homes for those on a moderate income; entry-level buyers and savvy investors are taking advantage of the current market and making their homeowner dreams a reality.
Bio: Laura Costello is in her final year of a Bachelor of Law/International Relations at Latrobe University. She is passionate about the law, the power of social media, and the ability to translate her knowledge of both common and complex topics to readers across a variety of mediums, in a way that is easy to understand.