Discounting on Sydney properties at highest level in years, with price drops biggest on the..

.. lower north shore.

Discounting on Sydney properties at highest level in years, with price drops biggest on the lower north shore

“I put my place on the market when I did because my tenant left quicker than expected, which in retrospect, I’m so glad about,” Ms Kamerling said. “If I was selling now I’d get less money.”

She ended up dropping the price from $1.2 million to $1.15 million, before the one-bedroom unit sold earlier this year for $1,050,000, through selling agent Craig Litchfield, of McMahons Point Real Estate.

“I didn’t get the exact price I wanted, but one has to be realistic,” she said. “If I did delay it would have been a lot worse."

“Some people say ‘no, I won’t accept that, it’s too low’, but who knows how long the downturn is going to last.”

 

... 1 bedroom unit.... over $1 mill... very much a discretionary type buy....

 

The listing is here.

53/17 East Crescent Street, McMahons Point, NSW 2060 - Property Details

$1.2 million strikes me as a lot, but a couple of other places have achieved similar results.

 

It is a lot, but that view is pretty spectacular.

 

We all knew the higher priced suburbs are going to take the biggest hit. This is always going to be Northern/Eastern Suburbs - not a big surprise at all.

 

That's a great view but 1mil for a 1 bdr that's borderline a shoebox is damn expensive

 

View, or no view, you've got to have rocks in your head to pay over 1mil for a shoebox.

 

I tend to agree, but then I look at the harbour and I think, wow this is the greatest place in the world, where do I sign.

 

View attachment 24806 View attachment 24807

If we are talking harbour views, perhaps we should just step it up a bit.

 

That is a bit more substantial than a shoebox. I see the appeal in that, but not at all with the tiny 1 bedder.

 

Market has softened, so may struggle to the $37m previously paid.

 

That is a beautiful and premium property. Let me address the title of the thread.

I was at some unit open for inspections yesterday in the Lane Cove area, and it was very busy with 40 couples through, and some offers even though it was the first weekend.

What I am seeing, is that unit prices in the Lower North Shore have nearly bottomed. House prices are still working off their over valuations, and are still coming down. These two forces will get lost in the averages, and likely take a few months to come through into the data. Again, I don't think this is the crash some were expecting.

 

Decent discounts in riverview and more to come I think. Stuff that would have sold for 3 in march 2017 is settling for 2.6-2.7 now.

 

[QUOTE=" Again, I don't think this is the crash some were expecting.[/QUOTE]

Maybe not, then maybe just the beginning. The problem with a falling market once it becomes accepted as mainstream, is that people tend to stand back and watch, after all why commit when prices are falling, every week is another few grand saved! This exacerbates the falls, and suddenly no one wants to catch a piano.

Over the last thirty years this process seems to have been avoided by political fear/expedience, first home owner grants (developer/bank aid) then doubling, then tripling, tax concessions, opening the gates of migration etc. None of this has helped deal with the core problem, housing is far more expensive in Australia than most developed nations, Australians pay a higher percentage of their money putting a roof over their head, higher stamp duties, higher estate agent fees, etc etc. And we welcome it because selfishly we think it is a good thing. No one cheers when petrol or food prices go up! We are eating our young, making our bankers wealthy, changing the culture and face of our over crowded cities, all to keep things up. A house is in effect a consumer durable, on average it costs 1.5% to maintain PA, yet it has in Australia been turned into a market that cannot operate on rental returns (like Hertz with cars) but instead has now relied on capital growth for the last couple of decades.Australia is a young country, but any study of long term housing will show that that is an impossibility in the long run, and a reset happens.
Just look at what you can buy in a City like Kassel in Germany, for half what you pay here, and it won't be an uninsulated 100mm single glazed timber shack.

Whilst not making any outright predictions, after all I think pressure from the banks will cause the government to open the immigration door again soon, I still think I would be very cautious in a market that seems so out of whack.

 

Interesting, John. In your first hand experience, what kind of fall have you seen for units and houses to date? (talking fall from peak in 2017). And how far further do you think houses will fall in lower north shore?

 

More immigrants?
Should do wonders for far right parties
Meanwhile in Kassel for less than the price of a semi in crows nest...

Historisches Schmuckstück in Bestlage!

 

It's been less than a year since the downturn began, which in real estate terms is not a lot of time. Real estate markets turn very slowly because most transactions are months-long affairs. Which is why large corrections usually run over about 3-5 years (if the bubble has indeed burst). If it is crashing, it could just be early days, time will tell.

 

Hi Runna Kedman,

Always dangerous to fortune tell, but here is what I think.

In 2018/9 I think we will see about 5-6% falls in units, and about 8-9% falls in houses. I we are about half way thought this process. It was a light weekend with the public holiday, but it is worth noting that lower north shore clearance rates yesterday were 84.6%, which are pretty robust.

As I have said on other posts, I think a falling AUD will absorb the bulk of the price reductions this cycle in what will otherwise be a healthy correction.

Best,