This article is from the Australian Property Journal archive
THE next six months will see a diverse range of outcomes for Sydney’s housing markets but the city’s more affordable suburbs are still expected to see the strongest price growth over 2024.
According to the latest Shore Financial State of Sydney Report, the more affordable suburbs are again forecast to see significant growth, though a shifting interest rate outlook should see a major short-term or even medium-term impact on property prices.
“Some suburbs are likely to experience strong price growth in the next six months, some are likely to stagnate and some are likely to go backwards, showing that Sydney is full of sub-markets that all have their own cycles,” said Theo Chambers, CEO at Shore Financial.
“Earlier in the year, it seemed certain that the next move in the cash rate would be down, and that may still be the case given that the latest labour market data showed a rise in unemployment from 3.9% to 4.1% in April.”
Chambers noted the RBA seems to now be considering further increases to the cash rate to address ongoing inflation, with even one rate hike likely to knock back market confidence and diminish buyer activity and prices.
The report has divided Sydney’s suburbs into five quintiles based on current median asking prices for houses.
Kingswood tops Quintile 1 – Heartland Sydney, with a current median house price of $860,000 and 4% growth forecast for the next six months.
Parramatta was ranked first for Quintile 2 – Suburban Sydney, with a current median house price of $1,500,000 and growth greater than 5% forecast.
Barden Ridge with a median house price of $1,663,000 topped Quintile 3 – Rising Sydney with a forecast of over 5% growth.
Quintile 4 – Professional Sydney, saw Dundas in first place with a median house price of $1,742,000 and a growth forecast of over 5%.
Finally, Quintile 5 – Affluent Sydney was led by Lane Cove with a median of $3,036,000 and over 5% growth forecast.
“Property listings are another variable to watch. While listings in some suburbs have seen increases in 2024, overall 80% of Sydney still remains at very low levels of inventory, with conditions clearly favouring sellers,” added Chambers.
Chambers added that this was unlikely to shift in the short term, but any improvement in listings would lower demand and likely drag down price growth over the coming six months.
“Forecasting is always tough as no one can see around corners – but it’s particularly challenging at the moment, given that we don’t have a clear view on interest rates and, globally, conditions are challenging,” said Chambers.
“History suggests that, in any given 10-year period, the Sydney market will experience ups and downs but ultimately have a significantly higher median price at the end of that decade than the start. There’s no reason to expect anything different from the next 10 years.”
