Sydney market expected to see moderate price growth in 2020: HTW residential Clock
The start of 2020 has been tragic with catastrophic bushfires across the country and New South Wales being particularly hard hit, according to the latest Herron Todd White (HTW) residential report.
The valuation firm asked their values to give an educated outlook on the residential market in their service areas in February.
"Time will tell how this will play out both economically and politically for the remainder of the year and what impacts this may have on the wider property market," the valuation firm said.
After the start of the recovery from the middle of the year, 2019 enjoyed a 5.3 percent increase in Sydney dwelling values over the year.
The last quarter of 2019 ended with a bang as Sydney property prices jumped 6.2 percent in the last quarter alone, with prices now only 6.4 percent below the 2017 peak (CoreLogic).
"We believe this jump was mostly due to an increase in demand after the elections and interest rate cuts, while new listing levels remained fairly subdued in comparison to prior years," the valuation firm stated.
Click here to enlarge:
Breaking down the numbers further, the top quartile of property prices saw the quickest recovery in prices in 2019 with a seven percent increase, compared to the bottom quartile only experiencing a 1.4 percent increase (CoreLogic).
The report suggests houses (6.1 percent increase) also performed better than units (3.4 percent increase) across 2019 according to CoreLogic.
This is not surprising since houses fell at a quicker rate during the downturn and unit prices are still being affected by an oversupply of new units in some areas.
Sydney also had seven of the top 10 performing metro sub-regions across the country, with the inner west and Baulkham Hills and Hawkesbury sub-regions both experiencing 8.8 percent increases over the year (CoreLogic).
Click here to enlarge:
"Overall, we expect new listings to increase in the first half of 2020 which should see price growth begin to moderate. Despite this we still expect to see prices increase by around 10 percent for the year, which will mean prices should move above the previous peak in the second half of the year.
"We expect prices to be fairly strong across most regions and sub-sectors however we expect the lower quartile to begin to improve at a quicker pace while new units in over- supplied suburbs may remain weaker for the first half of the year."
A number of infrastructure developments have recently opened, or will open in 2020, which will continue to strengthen prices in the suburbs benefiting from these links.