One buyer's agent has used new sales data to proclaim Sydney's property boom well and truly over, predicting a market rout for investor hotspots on the city's outskirts.
Sydney suburbs such as St Marys and Campbelltown have transformed from a hotbed of investor activity to a buyer's market in the space of just five months, according to buyer's agent and director of Smart Property Adviser Kevin Lee.
Mr Lee researched CoreLogic RP Data sales statistics for 20 postcodes across Sydney from September 1st 2015 to February 18th 2016, and describes the results as "horrifying".
The research covered the number of new properties listed on the market and the number of properties sold each month for suburbs including St Marys, Campbelltown, Kellyville, Castle Hill and Wahroonga.
All data points to a significant change to the market dynamics at play in Sydney’s middle to outer suburbs, according to Mr Lee.
“If I look at St Marys in September last year, four new properties went to the market and there were 45 sales. If I look at February, 82 properties went to the market and there were nine sales,” he said, adding that investors may have missed their opportunity to capitalise on recent price growth.
“I wouldn’t go to market now if I was thinking of selling, I would not go to market there. I’d say you’d want to keep a monitor on it for the next six months and then reassess, and if you don’t need to sell, don’t sell. Because if you look at that from four properties hitting the market to 82, sales going from 45 down to nine, there’s a lot of pain. Those people that wanted to sell, they’re going to struggle I think.”
Sydney’s inner suburbs don’t appear to have been as dramatically affected over the analysis period, with Mr Lee predicting they will be the last to feel the pain of a changing market sentiment.
“Salubrious ones like Paddington and Mosman and that sort of thing, they haven’t had that influx of new stock on the market, so there’s not the pain, or the speculation, happening there,” he said.
Mosman recorded seven new listings and 101 sales in September 2015, with seven new listings and 31 sales being recorded between February 1 to February 18, 2016.
“When the wave comes through of prices being pushed up, it starts in the eastern suburbs and the northern beaches, southern beaches, and then works its way out to Penrith. It takes about a year I suppose to get to Penrith, and then it comes backwards, it rolls backwards the other way," Mr Lee said.
Even so, regardless of which Sydney suburb investors have purchased in, they’ve probably missed the ideal opportunity to sell, with Mr Lee calling time on the current market cycle.
“I think we have seen the best of it. If you were selling, the best time you would have had would have been up until August, possibly September 2015. After that, you were lucky to get out with anything near the price that you thought you were going to get, and I think if you’re now starting to think about selling in March 2015, you might have to think again.”