The housing market in Sydney witnessed a massive growth in 2015, with prices increasing by 10 to 12% across several areas in the city, even in those that were so far left ignored by investors. But things cooled down a bit towards the end of 2015, and we expect 2016 to be a year of stability. So if you are looking to sell property in Sydney, Australia or to buy property in Sydney, let’s see what trends are in Sydney’s housing market in this property update Sydney 2016.
Gradual growth in property prices
Property prices in Sydney will grow steadily in 2016. There won’t be the crazy growth witnessed in 2014 and 2015. There is a lot of speculation that the Australian Reserve Bank will cut down interest rates across the board, but should not affect the market much, as we don’t see the banks passing on the benefit to customers.
More first time home buyers to enter the market
Australia was built on homeownership. It is a natural progress for young people in Australia to buy a home after getting a job and getting married. Homeownership in the country has always been encouraged, and we expect more young people buying their first homes in Sydney. Keeping this in mind, many developers have built entry-level homes for first time buyers. But Sydney being Sydney, even these entry-level homes are unaffordable for most young people. Hopefully homes will get more affordable with the lowering of the interest rates, when it comes through.
Rise of Chinese developers
That the Chinese are big investors in properties in Sydney is old news. 2016 will see something else – the rise of the Chinese developer. Many major Chinese real estate companies have started operations in Sydney, building developments exclusively for wealthy Chinese individuals. This really is a good thing, as any foreign investment should be welcomed.
Supply lower than demand
Unfortunately in Sydney, the supply is a lot lower than demand when it comes to housing. This is one of the factors that led to the huge growth in property prices seen in 2014 and 2015. We expect the same to continue 2016 as well, largely because of poor planning by Sydney’s planners and the local councils.
Less speculative investment
One of the positive trends expected to be seen in 2016 is that the housing market in Sydney will become “normal” yet again – which means many of the speculative investors will be pushed out of the market because of the relative slowdown in property prices. 2016 will see the rise of the homeowner, people who buy properties with the intention of actually living in them – not just as an investment. This is great news for the housing market in Sydney, indeed.
Growth in all areas in Sydney, even those that were left behind so far
The growth in Sydney has never been uniform across all regions in the city. Some areas have grown faster than others and receive far more investment. 2016 will be the year when regions that were left out will get the attention that they so richly deserve. Things such as the construction of the south-west rail link, four new metro train stations, the, and eight new stations in the north-west will do wonders for the development of far-off regions, especially the key suburbs and bridge the divide between east and west Sydney.
No more auctions
Another major development we expect to see is that auctions will be less of a factor in the property market in Sydney. Property auctions were always a part of the sales process in Sydney, but that is changing fast. Vendors are moving away from the auctioning path.