The Sydney Market - Will it Swing Back?
My opinion is Yes it will, but not all the way back. The strong swing, has created a new mid-point. So it will come back a bit, but not all the way back.
It is a little early to making these statements, but based on the somewhat struggling current auction clearance rates, which are actually worse than the percentages suggest. (Check the number of unreported auctions in the Sunday newspapers).
We are unlikely to see a lot of growth in the next 3 to 5 years. Primarily due to affordability and tight lending conditions.
If you are considering to invest in Sydney, you should be looking to manufacture growth. That is, through renovating and/or developing. You want to be asking how you maximise the return on space? A granny flat, new bathroom or kitchen, adding a bedroom, building two houses on the one block, moving into developments, etc.
The natural boundaries of Sydney, National Parks to the North, West and south and Ocean to the East – will allow for future growth.
The number of people immigrating to Australia will help future growth. Keep an eye on this. This key to the growth of Australia. A great way to keep growing a healthy economy. A mistake Japan made, that put them into recession. Growth is important. People fuel the economy. Therefore, I feel the government will allow even more immigration in future.
You cannot fight it though… Sydney is a glorious city and will hold its value. We just won’t see the high grow rates we saw in the last 5 years.