A few interesting articles on the state of the current market…
The forecast for capital city housing markets remains mixed for 2017, with no surprise that Sydney and Melbourne are likely to continue to lead. It is likely that other capitals will remain steady, with price growth generally constrained by low income economies. Lower interest rates in 2017 are likely to continue to bolster housing markets, with an increasingly underperforming national economy almost certain to require further stimulus from the Reserve Bank. House price growth, although remaining positive in most capitals through 2017, will likely track in a narrow range of up to 5% annually for the top performers. Unit markets will continue to be influenced by significant levels of new apartments, acting to push supply ahead of demand. The impact on local prices will vary, so keep your eyes out for a bargain on the unit market.
The Sydney unit market is set to remain strong, due to a chronic undersupply of units and solid demand, holding prices strong. This makes 2017 a great time for Sydney sellers. Record new apartment supply in the Melbourne CBD will continue to outstrip demand, with downward pressure on prices to continue in that submarket. Strong demand and lack of supply for suburban units, however, will offset the weaker CBD market. This means that overall Melbourne unit prices growth is likely to remain positive over the year. Unit prices in Brisbane, Perth and Darwin can be expected to continue to fall. Adelaide and Canberra are set to produce positive but modest price outcomes over the year.
FOCUSING ON SYDNEY:
Due to the increased popularity of sharing platforms such as Airbnb, the short-term holiday rental market will remain popular this year. One-bedroom, one-bathroom, no-parking properties around Surry Hills, Chippendale and Darlinghurst can provide a decent return and are relatively affordable at around $650,000. Increasing patterns of renovation will continue to provide good returns. Some areas will also experience a slowdown in 2017. Frenchs Forest has seen a huge growth in 2016 but will likely level out this year. Bondi will also slow down, with an increase in supply of apartments being built in the area.
North: We will see an increase in young executive couples purchasing in areas near the new light rail such as Castle Cove, the lower north shore, Cammeray and Northbridge.
East & Inner City: Kensington and surrounds will make sound investment options, with the new light rail passing through these suburbs once completed.
West: The Hills, Castle Hill and Cherrybrook will pick up over the next year in anticipation of the new train line that is set to open in 2019.
SOURCES: DOMAIN GROUP, ANDREW WILSON, 2017 AUSTRALIAN PROPERTY MARKET PREDICTIONS; WHICH INVESTMENT PROPERTY, SIMON COHEN, WHATS ON THE PROPERTY HORIZON FOR 2017?
The Property Centre Rockdale 