NSW Sydney , 10 % growth in 2016 ?? what do you think

Sorry I was quoting from Property Investing In Australia For Dummies.

 

No chance

 

How much are prices in Sydney being driven up by the expectation that the property will sell for twice as much in a decade or so?

If it's a major factor then I think that property could soften significantly as optimism fades.

 

I'm seeing owner occupiers buying in Sydney. If I understood correctly, my colleague told me today he is looking to buy Westmead or west end of Parramatta (West of Pitt St) so he can enrol his son into Parramatta High school for the reason of selective classes. (I suppose it's a lot better than Arthur Phillip High School?) Failing that, he wants to send him to Pennant Hills High. I said if the can get an affordable place in Pennant Hills, he should go for that... In 4 years (assuming he is still working there) CBA and his job won't be in Parramatta anymore. His wife is working in Rhodes as a lab technician and her job could be elsewhere. I figure Pennant Hills will have the trains going down to West Ryde (and Rhodes) again and to Redfern when the NWRL (North West Rail link) kicks in?

Anyway, they are priced out of a house, and he is thinking town house.

 

Yep. The huge gains in short periods in Sydney seems to me to be mainly driven by greed and foma, so if that evaporates things will stagnate for years once again.

 

Interestingly, saw this posted on facebook by Ric Serrao from Raine & Horne today. While I'd always take agents words with a pinch of salt, I'm interested to see how the Eastern suburbs perform in 2016.

 

I actually don't think it was driven by speculation so much. I think overseas money and low interest rates brought the demand in, but also rezoning helped some areas. For example, Epping and Eastwood boomed earlier than much of Sydney because of Chinese demand, and since people who wanted Epping and Eastwood got priced out, those buyers then tried the surrounding suburbs and then.... A huge wave, not a ripple. Lots of people want to have a home here in Sydney.

Sydney has limited directions to expand, you either have to go towards the South West, North West, Central Coast or Wollongong or high rise/higher density.... Well, while there's still strong demand to live here and people have available dollars to burn the effect is that prices will go up for properties in well located areas. (Apartments can be overbuilt but I think the high supply will be absorbed... imo Sydney suffered from a massive building shortfall for a long while and only now is it really catching up)

Anyway, with our high prices then there's no wonder us cashed up Sydneysiders then all go to that outer suburb of Sydney known as Brisbane since Sydney is stupidly expensive and Brisbane looks to be good value... But there are still regular folks (who aren't investors) looking for their PPOR to live in in Sydney...

 

Sydney will have markets that can still rise and markets that will certainly fall but all in all my feeling is that overall prices can not go up any further at all until income goes up. Prices can not go up any further because there are few people that could possibly afford to buy if prices go up any higher. The dollar coming down will no doubt help to kickstart a little bit of wage growth but I dont think it will happen for a few years yet.

 

Flat, at best. For next decade.

 

Other than the rezoning, haven't those fundamentals have been in place for many years without such big gains? Even rates have not been too high for quite a while. So to me, it seemed when some of the Chinese money came in, the prices rose, others saw the opportunity to profit, and bought more, then everybody else poured in to capture some of this as well.

Isn't that also what I was saying - the opportunity for large gains, plus fear of missing out factor started to get everybody piling it at once, pushing the prices up significantly in a short period of time?

 

I can see a 10% on average drop in Sydney.
Big crack down on money leaving China.
BHP at 14 dollars. ASX lowest in two years .
Ageing population selling up to fund retirement because super funds are going backwards.
Sydney went up more than other capitals which will catch up over the next couple of years.
Never seen so many homes for sale in Mosman. For good reason.
Brisbane the best return over the next couple of years leading into Commonwealth Games

 

as a non-sydney person - been studying and looking at listings in chatswood. i know lots of people who are keen to move to this suburb from overseas.

 

I actually don't think there was too much of other people following the Chinese to be honest, but perhaps more of FOMO from first home owners and also activity from upgraders is something I did see. Plus people putting big money towards Castle Hill and surrounds due to the new rail link. Sister bought a couple of years ago in Castle Hill... market was very quiet then. And one to two years later.... suddenly boom!

 

I don't care where the money comes from, how it comes in or who brings it in, Just keep the good times rolling baby

 

Over what period do you mean? It looks like listing numbers have been declining (unless they are turning over very quickly).

 

Less than 10% in next 12 months - mainly driven by foreign investment to flatten out in 2017 and onward

 

That would be fine by me.

 

yea, I would agree with that as well. I think Sydney has reached a point where salaries will have to rise in order for prices to continue to ascend. Affordability with wages is too big of an issue for the masses now in Sydney- except foreign buyers who earn elsewhere and often have murky sources of income.
In saying that, would be interesting to see what has happened in previous cycles.ie house price growth compared to salary growth. I'm guessing after a big cyclical upswing it will take a pause until salaries grow which results in affordability becoming better..leading to people buying RE and thus increasing prices again and the cyclce starts again...

 

Initially, I thought we have a friend in common.

But westmead is a lovely suburb and yes, with a good piblic school. Parramatta - I am not sure though.

Even a friend of mine is looking around parramatta. He is looking for a townhouse as well. Thank god he lowered his budget.

 

Question I'd ask is have you ever looks at the Mosman market before because that is just plain

WRONG ....

Check out sqm , free research and you will find the number of listings in MOSMAN ( I assume you are talking MOSMAN , SYDNEY .......) is the lowest it's been since the start of 2010 and still trending down .

Cliff

Edit . Just realised SR has posted on the same , though more politely ... The graph linked is what I'm referring to