Sydney remains at the forefront of NSW demand, even in the face of falling property prices around the state
NSW continues to absorb much of the property market slowdown as interest rates remain relatively steady and property prices continue to dip. Existing investors may have concerns about the viability of their properties, while newer investors may see this as an ideal time to start purchasing.
Sydney remains the most expensive and valuable city in the state, says Kate Forbes, national director of property strategy at Metropole Property Strategists. Accordingly, she believes the city “will continue to experience a chronic shortage of homes”. Furthermore, in the wake of five years of strong growth, the recent pricing shifts are indicative of a “soft landing” after this period of prosperity.
“Strong economic growth and jobs creation is leading to population growth and ongoing demand for property in Sydney; underlying is demand well ahead of supply and the rental market is tightening,” says Forbes.
Competition also remains strong within the city. Forbes points to international interest from tourists, migrants and investors as key factors.
“Now more than ever, critical property selection will be more important to find an investment-grade property that will outperform the property market,” she says.
Beyond the big city
Still, opportunities abound for those who are willing to look for them beyond Sydney’s ever-expanding borders. Wollongong and its surrounding areas present a number of interesting opportunities.
Looking northward, numerous properties in Ballina and Byron Bay are also undergoing extensive renovation and renewal, particularly in the Ballina Island and East Ballina precincts. This has been born partly out of necessity – such as legal requirements for owner-occupiers – and in response to buyer interest. There is demand among investors for high-quality, renovated properties.
However, for those who do want to maintain investments somewhat closer to Sydney’s urban hub, it may not even be necessary to look so far afield.
“One of the nice areas I like is Central Coast – that’s an hour and a half from Sydney,” says Philippe Brach, CEO of Multifocus Properties.
“The lifestyle is great – we’re looking at houses around $600k, which is a lot cheaper than if you’re closer to Sydney.”
SUBURB SPOTLIGHT
FIGTREE: Prices keep rising in sought-after Wollongong suburb
Just a short drive from Wollongong CBD and only an hour and a half from Sydney, Figtree is emerging as a go-to location for investors and renters alike, combining the appeal of the South Coast with easy access to city-based facilities.
While houses have seen median prices shrink by 1.8% over the last 12 months, average growth in the past five years has been substantial, at 52.8%. Units seem to have been relatively unaffected by the recent price decline, growing by 3.7% in the last year alone. With a gross rental yield of 3.8% for houses and 3.1% for units, the property market in Figtree is a stable prospect with impressive room for growth.
Facilities: Amenities include Figtree Grove Shopping Centre which has several major brand stores
Unit-based living: Units have a history of strong growth, and prices continue to rise
