NSW Sydney prices going too far?

I went to an auction today at Cherrybrook. Over 20 bidders for a house that would have sold for $1.5-1.6 million a few months ago went for a whopping $2.41 million ($300k over reserve).

6 Lyons Place, Cherrybrook, NSW 2126
https://www.realestate.com.au/sold/property-house-nsw-cherrybrook-135573566

This is not an isolated sale. A lot of standard 4 bedroom houses are selling well over $2m mark and within days of being listed.

Apparently it’s same story across most of Sydney particularly for freestanding houses in established mid to inner ring suburbs.

In the case of Cherrybrook, it’s an easy 25-30% price increase post covid (even steeper for above house which will set new base for future sales).

This price hike is welcome but the pace is frightening!!

Any other reports/views on Sydney runaway property market train?

 

Employment numbers were way stronger than we expected. With so much money pumped into the economy via QE, I think we'll see genuine (strong) inflation sooner than people think. If that happens, then these prices will definitely hold / be justified.

 

Wtf??? My god...

 

We are in midst of a super cycle - prices do seem to appreciate at astounding levels during the peak of these cycles however do note that the median of a city/ aggregate cities is what counts and surplus units/ TH stock is acting as headwind against median in suburbs with houses + units however house-only pockets seem to be tracking at 10% per quarter.

The areas that appreciate during a massive spurt start slowing down as the gap widens between them and adjoining areas and then the ripples cascades wider - so whilst it might appear scary to the holders, as the cycle starts maturing the growth spurt goes wider and delivers growth to surrounding areas.

Premium pockets of Melb are experiencing identical levels of growth spurt and whilst talking to a few agents over the past couple of days, the common theme was that they have stopped referencing any sales beyond the past 2 weeks when appraising prop values - it is that fluid. It will settle down eventually, however just like the recent rains in Sydney, it might dump crap-load of unexpected growth before we see a rainbow forming!

Hold tight and enjoy the ride!

 

Certainly are. Experts are now saying Sydney prices will rise between 20 and 30 percent per annum.

Property use to double every 7 years, but in the current interest rate environment, this is likely to accelerate to doubling every 3 years.

RBA has confirmed rates will remain on hold until 2024.

So in 2024, you will sit back and go, what a bargain, 6 Lyons Place, Cherrybrook for only $2.41 million.

I suspect the RBA will have trouble increasing rates, so its conceivable in 2028, that same property would be worth 9.64 million.

 

Similar price for similar house?

https://www.realestate.com.au/sold/property-house-nsw-epping-135665346

 

I am bullish and super optimist about the prop values in this cycle - but .... I don't see a $2.4m prop going up to $9.64m in 7 years! That is not even wishful thinking.. unfortunately

But 10/10 for dreaming big! Your optimism balls mine outta park by a country mile...

 

Omg. If that's 2.5 mill, wonder how much i'd get for mine. That linked property looks unrenovated and it's just a 2/1/1.

 

Castle Hill. $2.541 mill on a somewhat main road.

https://m.realestate.com.au/sold/property-house-nsw-castle+hill-135572430

 

Crazy money, but what you have to pay at the moment. $2m will be the typical price for a 4 bedder in the Hills soon.

 

One of the few pundits I respect
Property prices: Why the house price doomsayers got it so wrong

 

@standtall When you say a few months ago, when exactly? 6 months ago?

I just did a valuation and I’m noticing everything is selling 10% above highest valuation number, but this has went more than that. 243k is a lot

 

I see a lot written about the Hills district of Sydney... is it because it has more enthusiastic forumites than other parts of Sydney?
Is it because the value of the North West Metro is only just fully appreciated now? Is it the schools factor that really makes it more prominent?

For example, the North Shore is more expensive but I hardly see much written about it on this forum. I see western Sydney, North Western Sydney a lot though.

And there's many other parts of Sydney that don't tend to get mentioned.
Anyway, is the Hills doing better than other parts of Sydney for price increases? Maybe or maybe not...

 

20 years ago, you would have said it was impossible for a CherryBrook property to sell for $2.41 million in a middle of a pandemic in 2021.

I suspect there will be too much debt in 2024 for the RBA to lift interest rates. If anything, they may have to reduce rates. This, coupled with increased immigration will send prices souring.

Think today we have surging prices, but net immigration into Australia is actually negative. Wait until the government gets immigration flowing again.

The next couple of years is when property millionaires are made.

 

Nevertheless when my current fixed rates come off, I'll be fixing again if 3 year rates are around 2%.

 

Yes about 6-9 months ago. My next door house (very similar to this one sold for $2.4m) sold for $1.61m in August 2020 and my new neighbor complained about such high price he had to pay. He is certainly not complaining anymore!!

 

I don't agree. North West, North Shore and the East is all you hear about in the media these days.

 

You are forgetting macroprudential tools, thats what took wind out of the last boom. But these are crazy times, we let men pretend they are women and compete as women in sport. Sanity has been left the building.

 

Look, after this boom will come carnage and there will be some collateral damage. I have zero doubt prices will retreat at some point.

But hopefully when the dust settles, prices will still be 15-20% higher than 2017 ie the new base.

 

Which experts are claiming 20-30% pa?