City Beat June 2023: Sydney secures off the plan sales success at affordable and luxury ends of the market
The May interest rate rise has done nothing to dampen the Sydney property market across May, recent data has shown.
The latest Home Value Index from property data analytics firm CoreLogic shows dwellings in Sydney, both houses and units, rose by 1.8 per cent.
Houses jumped 2.1 per cent, largely due to the lack of supply, while units saw a second consecutive month of over one per cent gains.
Units, which in corporates apartments and townhouses, rose by 1.1 per cent across May, following 1.2 per cent gains in April.
The rolling quarterly figures have Sydney units up 3.3 per cent, now approaching a median of $800,000.
Sydney's 1.1 per cent jump was the joint second best performing unit across the capitals, level with Brisbane but some way behind Perth's 1.7 per cent spike.
Read more: City Beat May 2023: Sydney sees strong off the plan sales activity
What's happening in the Sydney off the plan market?
Developers are seeing success at both affordable, what many would deem unaffordable, ends of the market.
Deicorp, who deliver around 1,000 apartments a year to the Sydney supply chain, have seen strong sales in their Western Sydney projects.
They've been securing sales at a rate of more than one every two days at their Tallawong Village project in Rouse Hill, which is being marketed by CBRE with prices starting from $540,000.
Deicorp's Executive Director Robert Furolo says the first 5 months of 2023 has seen a significant increase in inquiries from purchasers and a corresponding increase in sales.
"Our Tallawong Village project continues to receive strong buyer interest, with more than 60 sales in the past 90 days."
Furolo said however there is growing demand in the $1 million and above bracket. Nearly 20 per cent of all sales across their projects have been above $1 million.
National developer Goldfields believes they're hitting the affordability sweet spot at their first Sydney project, The Bryson of Chatswood.
Goldfields CEO Lachlan Thompson said they've seen a a lack of affordable investment properties in the market due to high demand for available stock.
"In terms of price point, the Sydney sweet spot is around $1.5 million to $1.8 million for two-bed, two-bath apartments," Thompson says.
"Many of The Bryson’s apartments come in well under that, positioning us well in the Greater Sydney market.”
Thompson says strong demand, coupled with limited new builds in Chatswood over the past five years, have been the key drivers behind the strong enquiry.
The rebound in established house prices is causing more affordability issues, Thompson says, which is bringing local families in looking at the three-bedroom apartments.
On the other end of the affordability spectrum, stock is flying off the shelves.
Aqualand continue to report huge success at their $1 billion North Sydney tower, AURA by Aqualand.
Alex Adams, Aqualand Head of Sales and Marketing, says they've seen a significant upward trend in buyer demand for well-located, high-quality apartments over the past six months.
"That continues unabated," Adams says.
"We’ve experienced month-on-month growth since November 2022 with a spike in sales every month this year. The project has clocked over $100 million in sales over the last three months alone."
Adams says sales have been across all apartment types at AURA, and are buoyed by major public domain improvements, transport development and the robust growth potential of North Sydney more broadly.
"We believe these strong sales are a positive sign for the broader luxury apartment market in Sydney.”
It's a similar story in Woollahra, one of Sydney's most sought-after suburbs.
National developer Fortis exchanged $116 million worth of residences at the Woollahra Collection over the launch weekend, with prices ranging between $2.6 million and $16.5 million.
Fortis Associate Director Jonh Yacoub says buyers in the top end of the market are seeing the value in projects that offer premium quality and amenities in sought-after locations, which has helped propel the flight to quality.
"While we were extremely happy with the high level of interest and buyer activity with Woollahra Collection, we also had a lot of confidence in the product we were bringing to market and the overall success of the project," Yacoub says.
"Woollahra is one of the most tightly-held suburbs in Sydney and we spent months in planning to ensure we made the most of this once in a lifetime opportunity.
"We collaborated with a team of some of the best architects and designers in Australia to develop the best possible design outcome and offerings in this project.
"Woollahra Collection has been extremely well received by purchasers and the wider community, clearly demonstrating market demand for premium residences.“
A recent report by Knight Frank found Sydney ranked ninth out of 12 key markets tracked globally for the number of super-prime sales of over US$10 million over the last 12 months.
Over Q1 2023 Sydney had 10 super-prime settled sales of greater than US$10 million, ahead of Paris and Orange Country, both of which recorded three sales.
Over the 12 months to the end of March, Sydney recorded 76 super-prime sales, putting it in ninth place, ahead of Geneva (63), Orange County (54) and Paris (26).
The total value of Sydney super-prime sales over the 12-month period was US$1.233 million, with an average sale price of US$16.2 million.