NSW Sydney Eastern Suburbs Price Drop

We closely watch the market where our PPOR apartment is in Sydney's eastern suburbs. 6-12 months ago we could have easily got $1.2m+ so now you'd think we could get $1.1m at least.... (assuming a 10% drop)

But people seem to be going crazy and selling at any price- a very similar apartment down the road from us sold for $760k this week (that's like 2013 prices) and another apartment (3x2 whereas ours is 2x1) sold for $1.1m- recent sales in the SAME BUILDING were around the $1.5-$1.6m price.

Are these people being guided by idiot agents, are they scared and taking whatever they can get or is something more sinister going on - eg actually selling for much more but claiming a lower price to reduce stamp duty and CGT)....? (is that even possible to do?)

 

I'm not sure specifically where you're refering to in the Eastern suburbs, but if something sold for 760k and a comparable is 1.1m then something definetly isnt right . Not sure if its comparing apples with apples or its an old lady got conned by an OOA agent But I dont see it as the norm.

I'm currently selling in the Eastern Suburbs and at the peak of the market I may have gotten 5% more than now but i am not seeing significant reductions in price for units along the coastal areas. 5-10% seems to be the average . Maybe 10-15% for the ones in poor locations eg busy main road .But that's from the absolute peak of the market to now.

End last year was ( and traditionally always is) a quiet period however activity in the units market has picked up significantly already. Not long ago a 2 bed 1 bath no parking , older block 65sqm sold 950k!

3/155 Blair Street, North Bondi, NSW 2026

 

Agree with Leo here- impossible to judge unless we know how alike both units are. Parking and internal size make significant differences in price, as does the location, age of building, any known problems in the strata (eg: lawsuits, special levvies etc) as well as a range of factors. How alike was the $750K one to yours?

 

Yes, I would like to see the actual sales listings on all those properties be able to run a comparison. Particularly with apartments, big ticket (unlisted) items such as pending special levies can have a real impact on prices.

Do you have any further information?

- Andrew

 

Anything around Potts Point? If it gets to a similar price to our PPOR for a two bedder then I'm jumping in

 

Age would be the biggie - this drop is most common on resale of recently completed OTP units. I wouldn't be expecting that sort of drop on older units unless there was some pressure applied. If you're seeing these sorts of drops, it may be bargain hunting time whilst vendors are running scared for no real reason.

 

@Jacque and @PMC Property
I don't know about upcoming special levies (strata is comparable currently) but from what I can tell, everything else is essentially the same to ours:
- renovated
- open plan kitchen
- art deco era
- no parking
- same street

The 3x2, I actually have no idea as the ones that sold for $1.5-$1.6 were in the same building also

@Sackie- I'm referring to Woollahra which I wouldn't thought would be subject to enormous price drops
@scottnomates all art deco era (I don't think there is any OTP around here!)

 

Something still isnt right because Woollahra hasn't seen a price drop like the one your suggesting.

This 1, 1 , 0 sold 805k

9/15 Raine Street, Woollahra, NSW 2025

 

both sold in feb 2019

3/2 sold for 1.11mn (oct 2013 price: 985k), this should have sold for close to 1.5/1.6 mn in peak?
2/39 Nelson Street, Woollahra, NSW 2025


2/1 sold for 760k
1/126 Edgecliff Road, Woollahra, NSW 2025

many recent sale have no price on it,

unit median fell from high of 1.52mn to 1.11mn currently, thats close to 26% fall.

 

Edgecliff road is busy so that price is decent for 2/1/0.

And the other one no parking either. I'm no expert in the Woollahra market but bondi north bondi , bondi beach units market has not corrected 30%. Not even close .

 

Great value houses and semis though . Units not so much .

 

Bondi beach unit has fallen 12%

 

No arguments there but not all units 12% .

 

of course that depends more on sellers desperation to sell in a downturn.

 

Yes and also depends on street location, parking and reno or not.

 

A compound annual growth rate of 9.2% over 5 years even after the current 12% drop, lots of suffering there

 

Yes these are the two examples I was referring to
@Sackie Edgecliff road isn't that busy- not enough to command a $760k price (e.g. it's not like Oxford St or Old South Head Road). There have been plenty of similar ones on Edgecliff road that have sold for $1.1-$1.2m very recently.

For 39 Nelson St, number 6 sold in 2017 for 1.5m and it didn't even have the second bathroom.

Then you have 29 Nelson St which was a redeveloped art deco block where 2 x 2 have all sold for $1.4- $1.5m plus - yes the building has been done over but is that really worth 2x what 1/126 Edgecliff Road sold for?

I am almost convinced that they all sold for much higher and then offered some additional cash under the table...

 

Hi Sackie,

Not necessarily.

One trick of the trade when buying units is to look for suburbs where the median price of a unit is 1/3 of the median price of a house.

So in suburbs like Bondi, units are good value. Suburbs like Bankstown, units are over valued.

When I look at the chart above, it seems to me that there is a floor under the price of units given the unit:house price discrepancy. Or at least, the price of units is relatively safer than the price of houses.

Hope this makes sense.

 

I just see more value in older semis (price drops) than units . Not saying there is no value in units atm but for me the best value in the area is not with units .

 

Hi Sackie, I’m interested in your view on semi’s. I’m looking to upgrade my PPOR in the Bondi / Eastern beaches area over the next couple of years and have been loosely monitoring the market. It seems like the drops have been bigger in the higher price ranges (say $2.4m+), with the market remaining reasonably competitive below this.

eg this unrenovated semi sold for $2.15m last week at auction. It’s in a great location but still seems like a lot for the work it needs.
14 Chambers Ave, Bondi Beach, NSW 2026

My takeaway was that the premium between renovated and unrenovated doesn’t warrant the effort to renovate. You can probably get better value, and bigger plots, if you can pay a few hundred more for the next price range up.

Interested in your view on this.