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Home prices in more than a dozen Sydney suburbs have already reached fresh record highs, and more are expected to follow suit as the property market rebounds.
Home values in 18 suburbs have surpassed previous price peaks reached during the last market boom, new figures show, quickly recovering from the downturn, and climbing further as buyer demand outstrips the supply of homes for sale.
Sellers Peter and Cristina Cameron, with son Jack, at their home in Glenhaven – where property prices have reached new heights.Credit: dwina Pickles
The median dwelling value in the north-west suburb of Glenhaven is 4.7 per cent higher than its previous peak, while values are up 4.1 per cent in Breakfast Point and 3.3 per cent in Strathfield and North St Marys, CoreLogic data shows. Figures include houses and units.
Values in western and south-west suburbs like Dean Park, Pemulwuy, Punchbowl and Claymore reached fresh highs last month, each up at least 2 per cent on their previous record.
Rushcutters Bay, Pymble, Belfield, Burwood and Mortlake are among those that have nudged above their former high.
CoreLogic Australia’s head of research Eliza Owen said the mix of suburbs had a sharp rebound in values, but also a shallower decline during the downturn, when Sydney values overall fell 13.8 per cent.
“It’s extraordinary that these markets have rebounded as much as they have given interest rates are so high, but … [if we look at where values were in early 2022], it paints a more turbulent picture of capital growth,” she said.
Sydney-wide, dwelling values are 6.2 per cent below peak levels, Owen said, having rebounded 8.8 per cent from their January low.
Recovering prices had been fuelled by a mismatch between supply and demand, Owen said, and the record-breaking suburbs were mostly a mix of affordable and aspirational areas popular with families.
“In the short term we could see more suburbs ticking into fresh record highs, but there is still uncertainty,” Owen said.
While the pace of price gains picked up speed last month, and auction clearance rates have been strong, affordability challenges could yet put more pressure on household budgets, limiting future growth.
Commonwealth Bank chief economist Stephen Halmarick expects Australian property prices to reach new highs next year, rising 7 per cent this year and another 5 per cent next.
“It’s a simple matter of demand versus supply, we haven’t been building enough new residences, and we’re now in this post-COVID surge back in net migration,” he said.
“Even though mortgage payments as share of income are very high and likely to go higher, the demand and supply equation just keeps putting upward pressure on prices.
Sydney’s property market has been rebounding this year.Credit: Peter Rae
“By around this time next year [prices will be] back to an all-time high, the outlook beyond that depends on labour market… as well as the amount of supply coming on.”
Lower turnover of homes – which has started to pick up more recently – had also put upward pressure on prices, he said, as had the view that the rate rises had likely come to an end.
Among those preparing to sell are Glenhaven home owners Cristina and Peter Cameron, who will soon list their four-bedroom home of 17 years to make a sea change to the Sunshine Coast.
Cristina and Peter Cameron, and son Jack, will swap their Glenhaven home for the Sunshine Coast.Credit: Edwina Pickles
It’s a move they’ve been considering for some time, and they were encouraged in part by the suburb’s strong rebound – the median value is up about 14 per cent from late last year.
“With the timing of it we wanted to make sure we would capitalise on growth in the area and … when we were thinking back in June about what is the market going to do, there were some positive signs,” Cristina said.
“Glenhaven is such a small pocket of gold within The Hills district and I think over the last 17 years it has come to blossom … [prices have] absolutely skyrocketed, we already knew it was going to happen and I think the advent of Metro was a game changer.”
Their home will be listed with a price guide of $2.4 million with Louis Carr Real Estate director Michael Roberts.
He said the suburb was popular with families looking to upgrade to a larger home or acreage, and that price gains in recent years had been supported by the rollout out of the Metro North West, then the rise of remote working, but were now fuelled by the supply and demand imbalance.
“Spring hasn’t come with the volume of stock we’d normally expect, listings are still lower … which is keeping prices strong even though we’ve had record rate hikes,” he said.
Roberts expected to see an increase in listings as spring progressed, which could help to steady price gains, but still expected growth.
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