SYDNEY’S booming property market is showing signs of cooling after one of the most historic years of property growth, however Western Sydney remains hot.
Affordable prices and buyers looking to exit the city and apartment life means interest in the west is still high as the region celebrates breaking the Covid-19 shackles.
And interest is being ramped up by a big increase in listings which were held back during the pandemic.
The Inner West is sizzling with a couple paying $580,000 above the reserve price for a modest home at Ermington. A crowd of 100 people, including 19 bidders, descended on the auction for a house in Gregory St with development potential.
The average price in Ermington is $1.39M but the stiff competition pushed the price $580,000 over reserve to a record $2.38M.
The home had been in the same family since 1952 and was set on a 700sqm block, ideal for development.
It was the first time the property on Gregory St was up for sale in about 70 years and the $2.38m price was a surprise for both the agents and vendors.
Selling agent Paul Tassone of Professionals-Ermington told media the reserve was set at $1.8m based on recent comparable sales in the area and $1.9m would have been considered a good price. “It was a crazy result,” Mr Tassone said, adding he had estimated the value was no more than $2m.
The registered bidders were a mix of buyers wanting to renovate the home, but the strongest competition was from developers wanting to replace the original house with duplexes, Mr Tassone said.
Part of the appeal was that the 708sqm block would be about 100m from a proposed shopping precinct and was across the road from a park and reserve.
There was still strong demand for property but the key change since lockdown was a greater selection of housing.
Buyers are spoiled for choice. There is no rush to move on what they see because the taps have been turned on full blast for new stock.
Well-located properties are the exception and were continuing to attract significant results because they were rare, according to experts.
Mr Tassone said inner suburbs were likely cooling faster than Western Sydney, which was continuing to draw buyers because of the more affordable prices.
The auction was one of more than 1000 held across Sydney om that weekend, a 91% rise in auction volumes from when the city emerged from lockdown in October.
Sydney’s house prices have increased by 30.4% in the past year, with the median price now $1.5m, following a fall in values of -2.9% between April and September 2020 when Covid first hit.
Parts of Sydney’s are cooling with the monthly rate of growth halved since the heights of March this year, when prices reached a monthly growth rate of 3.7%—the fastest monthly increase the city has experienced in three decades.
October’s prices showed a modest dip from the previous month, when values grew at a rate of 1.9%, while house and unit price growth also slowed after growing by 2% and 1.5% in September.
According to Corelogic, property values rose 1.5% in October and are now up 23.8% for 2021.
A typical Sydney house is $320,000 more expensive than it was at the beginning of January, while units have experienced a gain of $100,000.
Sources: The Professionals, Corelogic, Urban Developer