NSW Sydney appartment price crashing may be bigger than I thought !

Campsite NSW? There is no chance in hell that it would survive any NG removal or further credit tightening. There is just way too much supply - clemton park development not even completed yet, apartments on Canterbury rd with more to come, housing next to campsite public school already sold off in rows with DA approval, new builds next to King Georges Rd.

 

So what if there are a few very narrow pockets of "oversupply" in some locations. They will be absorbed quickly

 

How do you determine, there is too much supply? Do you just look around and go whooaa..

or do you calculate that the LGA Canterbury gains ~2,000 people per year and offset that against number of new residences built?

 

Campsie is a high demand area. Like Harris Park but less attractive and more diversified. There are a lor of Koreans and Vietnamese. A lot of students and singles. They both reached ridulous highs a few months ago at over 500K for just a 211. Now sitting high 4's. Nothing to get upset about.

 

Yes you can look around.

Who cares what the population numbers are? Look at what the yields have been doing (see chart below)

Yield for units in Campsie (source: realestate.com.au)


Yield for housing in Campsie (source: realestate.com.au)



You could move all of South East Asia into Campsie for all I care - it won't matter. The yields fallen and have stayed low, despite the population increases that people would like to tout. There is no new information to indicate a reversal of trend.

 

Did a bit of house hunting recently, I asked the agent the reason for sale. Was told among about 7 vendors, 3 are moving to Melbourne, 1 is moving to QLD. They are interstate migration which sydney is loosing.

I do not think we need to calcualte the people movement here. Developers have alrady done that thoroughly and supplied the stock according to their calculation. The same good reason aften can be the killer of market, whichever you see it.

 

I'd be more concerned about the construction quality than the froth that's been bubbling for a while.

 

The correct way is to say : "a few very narrow pockets of undersupply, if any"

 

Couple all of the above with the projected reduced immigration rates expected for the next two calendar years (reduced national figure but also a mildly reduced NSW figure).

Certainly gonna be an interesting 2016 ahead!

 

Signed up as an interested buyer for a new Macquarie Park apartment to be completed in roughly 3 years. They called me yesterday trying to get me interested. Today they sent an email out to interested buyers with a reduction in some of the prices. Feels like there might be a lack of interest for them.

 

Just too many of them and investors are banking on Macquarie uni students...

 

@FirstTimeBuyer is this where the old Stamford was?

 

Re: Macquarie/ Herring Rd. The huge numbers of Chinese aren't buying... I went to their display showroom a few years ago it was jam packed and I would consider everybody there as Chinese...

 

New apartments in Chatswood are targeting the Maquarie uni students also. They offer a better location and only a 10 min train ride to the uni.........

 

Macquarie is expensive as it is. Chatswood is on another level in terms of prices. There are heaps of apartments coming up along boundary Rd I think..chatswood West?

 

NSW net interstate migration is currently at its lowest levels..kinda looks like everyone is moving from WA to NSW.
@petewargent

 

Interstate migration data lags quite a bit - at this stage in the cycle you'd normally expect to see migration into QLD picking up, provided people can find the jobs to move up from places like Sydney. Sunnier & cheaper in QLD

In terms of any Sydney oversupply the population projections from Infrastructure Australia suggest it's probably going to be temporary. Naturally yields have been eroded because housing prices have increased so quickly.

Btw, net overseas migration into Australia is projected by the DIBP to rise every year for the remainder of the decade, largely due to international student visas:

https://www.border.gov.au/ReportsandPublications/Documents/statistics/nom-december-2015.pdf

 

Saw this article from last year that might be relevant to this: Melbourne apartments sold at a loss because of glut

Sorry, don't know how to quote ---

The proportion of apartments selling for less than the purchase price rose in Melbourne, Brisbane, Canberra, Perth and Darwin in the second quarter, bringing the capital city average to 8.4 per cent from 8.1 per cent in June, CoreLogic RP Data's latest Pain & Gain report shows. Nationally, loss-making apartment sales ticked up to 12.6 per cent from 12.5 per cent.

The greatest effect of new supply on prices was seen in the Melbourne central business district CBD, where as many as 20 per cent of all sales – where the product is overwhelmingly apartments – were sold at a loss, for a median figure of $28,125 per transaction.

Sydney, where new supply is less and there is greater unmet demand, bucked the trend. The proportion of loss-making apartments stood at 1.8 per cent in the June quarter compared with 1.9 per cent in March.

Anyone know if there has been an update to this?

 

There is an amazing amount of development happening around Mascot. Every time I drive a long Garneners Road, a new tower is going up. There will be dozens of them. And there's nothing there - apart from the Saturday sausage sizzle at Bunnings.

 

I live around the area.

Which particular street of Campsie? And how far from Beamish street (train station and local shops) ?

Those 450-500k prices sounds like very old units on the outskirts of Campsie.

Seeing the number of completed OTP coming online rapidly does raise concern in my opinion. However, what blows my mind is that one developer who just completed the one on South pde (BRAND NEW TWO BEDROOM APARTMENT – BOUTIQUE AROWANA BUILDING | The Property Business) is planning to build another 6 storey OTP on adjacent public carpark. With talks about the market peaking and dreaded oversupply, they are still attempting buy-out more lots on that very street !!!