Despite talk of a market slowdown across Sydney in 2018, the eastern suburbs are already showing signs of a strong year ahead.
Compared to the last few months of 2017 we’re seeing even more buyer activity, with higher attendance at open homes in all our key markets. So what will 2018 look like for buyers and sellers?
Sellers: Will more stock mean a price drop?
While I’m reluctant to apply general Sydney market predictions to the ever-resilient eastern suburbs, for 2018 I don’t necessarily predict a repeat of the huge jumps in value seen in previous years. Part of the reason for this is the uptick in stock we’ve already seen coming onto the market, which led to Sydney’s mid-February auction clearance rates hitting almost 70%.
But even with those figures in mind, there’s no reason for sellers in Sydney’s east to make any major compromises in terms of their sale price targets. It’s important to remember that values in these suburbs tend to move independently, bucking the trends we see elsewhere across the city.
Buyers: Affordability could drive out competition
‘Affordability’ continues to be one of the buzzwords for the Sydney market this year. Many buyers are now completely priced out of Sydney’s inner ring – especially those entering the market for the first time.
For those who do have the budget to focus on the eastern suburbs, this move away from the city could mean fewer bidders at auctions towards the lower end of the market. That said, properties in the mid to upper price range should still attract plenty of competition from those who want to secure their eastern suburbs home before prices rise any further.
Where are the eastern suburbs hotspots?
Looking closely at suburb-specific data, where are we likely to see the most buyer competition – and the highest returns for sellers – in 2018? According to CoreLogic, three suburbs stand out due to their consistent upward price trends over the past three years:
- Clovelly: A stable median price of over $3.25 million for the past year is bringing in annual capital growth of 7.55%.
- Randwick: While growth here is less pronounced than in Clovelly, Randwick prices have also been steadily increasing since 2014. Buyers are now looking at a median price of over $2.4 million, with annual capital growth of 7.69% for property owners.
- Maroubra: This suburb continues to be one of the east’s overlooked hotspots with annual capital growth now at 9.69%. Median house prices have risen sharply and are now sitting at just over $2 million.
Of course, we’re still only a few months into 2018. There are always local and international factors that could move the market in ways no one can predict.
Can a ‘slowdown’ ever affect the eastern suburbs?
While we’ve been hearing about Sydney’s falling property prices for some time, we’re yet to see any definitive impact on values in the eastern suburbs. Even if the more dramatic predictions of a 10% price fall in Sydney over the next two years turned out to be accurate, this doesn’t mean we’d see the same percentage decrease across every Sydney suburb.
It’s important to remember that predictions are just that. Always look at real estate trends on a suburb-by-suburb basis and trust local expertise over the latest media headline.