Records are made to be broken

It’s finally happened.

Record Sydney home prices have been reached.

And who would have thought?

The last peak for dwelling prices in Sydney was in July 2017. Between that time and the re-election of the Liberal government in May 2019, the Sydney property market experienced a decline of -15.3% in value.

The market recovered and underwent a steady rise in values until this upsurge was interrupted by the coronavirus outbreak. It was at this time that economists and analysts were predicting that property values were facing between 10 – 30% falls in the ensuing months.

And the market responded accordingly.

Unsurprisingly, buyers and sellers who had been preparing for a move in 2020 abandoned their plans, and the brakes were applied to an otherwise flourishing market. What was surprising, was that during the worst of the pandemic, between April and October, the market shed only -3.0% of its value, totally in contradiction to what the experts had forecast.

This is where intrigue is piqued. How have we bounced back with such fervor and rigor from a position of vulnerability imposed by the virus to all-time, record-high prices?

In fact, since October 2020 house prices have risen by 5.7% (that’s an average of just over 1% per month), with February having the highest increase in 18 years.

JobKeeper ends on 28 March and questions are being asked about the impact, if any, this will have on housing prices. How many homeowners will experience mortgage stress? How many of these will turn into distressed sales?

JobKeeper aside, how can home buyers keep up with the rapidly rising prices when wages are remaining relatively stagnant and the slightest upward shift in interest rates could push a lot of mortgagees over the cliff?

The upward pressure on home prices is forcing a lot of borrowers to revisit their lender or broker to squeeze the last few possible dollars out that they can, leaving little buffer to meet repayments if their situation or interest rate changes.

The RBA has stated that interest rates are set to remain stable for the next three or so years. The cash rate that the RBA sets have a lot more to do with the overall economy than just the housing market. However, if the market becomes too hot, it may be a situation where APRA steps in to quell the flames and avert a full-blown inferno.

Having said all that, if you are thinking of selling, now is one of the best times to start the conversation and planning. Our market conditions are unique right now and perfect to take advantage of.

We achieve our strongest results by following a proven strategy, tailor-made to your situation. Take the opportunity to gain from this advantage and my expertise and contact me now.

If, however, you or anyone you know would just like to discuss the current value of your home and the best strategy to get you the best price when you come to sell, you can contact me any time.

Below are a few properties we are currently marketing for sale.

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Published August 24, 2021

By Belinda Cassano