Homebuyers and investors in Sydney are becoming disempowered and have less room to negotiate as the market heats up, according to a leading property analyst.
Speaking at a Multifocus Properties and Finance event last night in Sydney, RP Data’s national research director, Tim Lawless, said the Sydney market currently favours sellers rather than buyers.
According to Mr Lawless, it is taking an average of 44 days to sell a property across Australia’s capital cities, but the most recent data indicates this number is as low as 27 days in Sydney.
“We’ve seen buyers become disempowered,” he said. “There is less negotiation in the marketplace.”
Mr Lawless said rental yields in Sydney were also being eroded due to the high capital gains the city is experiencing, combined with slow-moving rents. He said this trend is difficult to overcome in the current market because it’s less likely investors will be able to nab a bargain.
“In a marketplace that is really favouring a seller rather than a buyer, it’s harder to negotiate, it’s harder to get a bargain and your timeframes are slim – you have to rush into a decision,” he said.
Mr Lawless said he anticipates the Sydney market will quiet down coming into 2014, but growth will remain high.
“We’ve already seen month on month the rate of growth is actually starting to show a slowdown – but it’s still extraordinarily high," he said. "Clearance rates have come down, so it’s a trend you need to watch.”