Western Sydney median dwelling values in decline: HTW residential

In Western Sydney the overall trend for dwellings is still weakening after a number of years of positive growth, according to the latest Herron Todd White (HTW) residential report. 

"Negative sentiment in the marketplace and tighter lending requirements have played a part in these falling median prices," the valuation firm said.

"We predict this trend will continue for the rest of the year."

The median house price in Erskine Park are 4% lower than December 2018, according to realestate.com.au data.

Marsden Park had similar figures with a 3.6% drop, whilst Oran Park has seen only a 1% drop in dwelling median values since December 2018.

"Our experience with residential units and off the plan sales has found premiums were paid in stronger markets for the then new product," the report said. 

"As the wider market weakens, we are continuing to see settlement valuations not meeting the off the plan purchase price.

"These valuations require recent resales of similar units to support the value and in many areas the evidence is unable to support the strong off the plan prices."

An example includes a recent resale in Parramatta.

The three-bedroom unit at 4803/330 Church Street (pictured below) recently resold for $990,000 representing a 30% drop in value since purchase.

It was for $1,285,000 off the plan in May 2015.

"This is not an uncommon occurrence with many units sold for a premium off the plan in a stronger market now unable to meet their initial purchase price up to four years later."

The report noted that there are signs in the marketplace that buyers for new units are harder to attract and a number of incentives are now being offered.

A recent example is the Pelican Estate (pictured below) in Schofields, a 270 unit development selling off the plan in western Sydney.

The developers Bathla are giving away $1.2 million in prizes to lucky purchasers with a $500,000 first prize, $200,000 second prize and a further $500,000 in prizes.

"Incentives and giveaways such as this are not typically seen during a booming market and are considered a sign of the times."