With Sydney set to be a seller’s market in 2021, where will buyers flock as they adjust to the new normal?
Buyer’s agent Grant Foley expects dwelling prices in the Greater Sydney market to increase by six to 10 per cent this year as the city recovers from the headwinds brought about by COVID-19 in 2020.
Record-low interest rates, along with tight supply, will continue to underpin activity as well as price growth, he said.
“Interest rates will continue to fuel demand from owner-occupiers, including first home buyers, while investor activity will lift significantly. Additional demand for Sydney property will also be driven by returning expats.
“Supply will continue to be tight, causing boom-like conditions and pushing prices higher.
“With mortgage deferral rates falling sharply during the back end of 2020, I don’t envisage a ‘supply cliff’ leading to a fire sale of Sydney properties,” Mr Foley explained.
Moving forward, established family homes in the inner-ring and lifestyle locations such as Northern Beaches and Sutherland Shire will see stronger growth in 2021, Mr Foley predicted.
Supporting this forecast, STRAND Property Group director and Northern Beaches specialist buyer’s agent Michael Ossitt said: “The Northern Beaches market rebounded strongly in the last quarter of 2020, given the continued lack of listings and an increase in demand from buyers.
The myriad lifestyle attributes of the Northern Beaches would also continue to inspire property buyers from near and far, he added.
“Out-of-area buyers continue to seek bigger homes and blocks, which are available in the Northern Beaches area compared to the inner- and middle-ring urban areas of Sydney.
“One thing we have seen predominantly since the onset of COVID are professionals and families from the Eastern Suburbs, Inner West, Lower and Upper North Shore seeking to move to the Northern Beaches for more space and those lifestyle factors, while compromising on the longer commute back to the Sydney CBD.”
Family-suitable houses on decent-sized blocks, priced within the $2 million to $3 million bracket, would see the greatest demand in the Northern Beaches, Mr Ossitt said.
Meanwhile, those looking for entry-level prices for detached housing may look at the central areas of Frenchs Forest and surrounds, where property go from around $1.5 million to $1.7 million this year.
Apart from the Northern Beaches, demand will also increase in the upper property price brackets in the Newcastle, Central Coast, Wollongong and South Coast markets as the intrastate migration away from Sydney to regional areas continues, according to Mr Foley.
“Demand for new-build house and land packages will continue to be driven by first home buyers and associated government grants.
“But the new-build apartment market will continue to limp along, hamstrung by reduced level of foreign students/buyers and changing consumer preferences,” he concluded.