Eleanor Creagh, Senior Economist
Updated 19 Dec 2022, 9:56am
First published 19 Dec 2022, 5:00am
The cheapest suburb that falls within 10 kilometres of the Harbour City’s centre is Sydenham, where the median house price is $1.335 million. Picture: Britta Campion / The Australian
In 2021, record low interest rates fuelled extreme buyer demand and an exceptional pace of home price growth.
Rising interest rates throughout 2022 have quickly rebalanced the housing market from last year’s extreme growth and remain front and centre of the fall in home prices.
Throughout the latter half of this year as interest rates have quickly risen, demand to buy property has slowed from the strong levels seen last year and into early 2022. As inflation rose and interest rates moved higher, consumer confidence has fallen, and expectations of continued price falls have weighed.
Housing demand has slowed significantly this year. Picture: Julian Andrews.
MORE: Waterfront home, toys, $1m gold could be yours for $2
Israel Folau offloads home for massive profit
Supermarket shoppers buy 100yo home sight unseen
Sydney prices have fallen for the ninth month in a row after peaking in February 2022, with prices falling a further 0.14 per cent in November to be 6.44 per cent below their peak.
Now the cash rate is sitting at 3.10 per cent with a substantial 300 basis points of tightening pushed through to date, maximum borrowing capacities have dropped by close to 30 per cent
Interest rates have quickly risen, reducing borrowing capacities and increasing mortgage servicing costs.
This has seen buyers gravitating toward the more affordable end of the market and demand and price growth have held up better in markets that are comparatively cheaper.
Render of proposed multi-unit development by Canterbury Baptist Church on corner of Balwyn and Canterbury Rds. Picture: Supplied
With life largely back to normal post-Covid, the impetus to leave the cities has reduced for some buyers. While the pandemic has shifted the need to be close to the city for some, buying a home close to the CBD is back on the wishlist for many.
But fast rising interest rates have dented affordability and shrunk buyers’ budgets, meaning many no longer have the capacity to pay the prices they were before interest rates started to increase.
New analysis of recent house price data from realestate.com has revealed the top suburbs to buy both houses and units within a 10-kilometre radius of the Sydney city centre.
The cheapest suburb that falls within 10 kilometres of the Harbour City’s centre is Sydenham, where the median house price is $1.335 million.
For buyers looking at units, Canterbury, where the median unit price is $650,000 is the cheapest suburb within 10 kilometres of Sydney’s CBD.
MORE: ‘Pocket listing’ key to cracking real estate market
Original Aussie hippie home seeks new collective
$210 an hour: what best holiday rentals can get you
Prices in these more affordable areas of Sydney may stand up better over the next year as additional increases in interest rates see mortgages become less affordable and borrowing capacities fall further.
Eleanor Creagh is a Senior Economist with PropTrack.
Buying
Featured
Disclaimer: The information published in this section is of a general nature only and does not consider your personal objectives, financial situation or particular needs. Where indicated, third parties have written and supplied the content and we are not responsible for it. We make no warranty as to the accuracy, completeness or reliability of the information, nor do we accept any liability or responsibility arising in any way from omissions or errors contained in the content. We do not recommend sponsored lenders or loan products and we cannot introduce you to sponsored lenders. We strongly recommend that you obtain independent advice before you act on the content.
Personalised advertising: We show you more relevant advertising based on your activity. Prefer us not to? Opt Out of personalisation
realestate.com.au is owned and operated by ASX-listed REA Group Ltd (REA:ASX) © REA Group Ltd.
02 8005 6525
info@aktengineering.com.au
Recent Comments