April 2023: Sydney’s Residential Property Market Update

The Australian residential housing market has been a hot topic in recent years, with a range of factors affecting property prices and market trends. Did you know that the total value of homes in Australia went up to $9.4 trillion by the end of March from $9.3 trillion the previous month? Not too shabby, right? 

Although, if we look at the past 12 months, dwelling values have actually gone down by 8.0%, which is the biggest drop we’ve seen yet. But here’s some good news: despite that, the values of homes in the capital cities actually went up by 0.8%! This is the first time we’ve seen an increase like this since April 2022. 

Similarly, the Sydney property market has experienced various changes and challenges, from government policies to economic conditions and global events over the past few years. In this update, we’ll be taking a look at the latest trends and insights in the market based on CoreLogic’s Monthly Housing Chart Pack for April 2023 and what they mean for homeowners, investors and other stakeholders. Whether you’re looking to buy, sell or simply stay informed about the market, this update is designed to give you an overview of the current state of Sydney’s residential property market.

Key Trends and Insights for Sydney’s Residential Property Market

Housing Cycles

The dwelling values have dropped by 12.3% from the all-time high back in January 2022. This is definitely cause for concern as it’s a pretty big drop, and it’s no secret that the property market has been facing some challenges lately.

But the good news is that the dwelling values actually went up by 1.4%, and over the past quarter, they’ve increased by 0.4%. It’s not a huge increase, but it is definitely something to be optimistic about. It suggests that things might be starting to turn around, and that buyers and sellers alike might be feeling more confident about the market. Of course, it’s still too early to say for sure what the future holds, but it’s definitely a positive sign.

Sales and Listings

At the national level, the number of property sales in Australia was estimated to be around 44, 124 in March. That’s a slight increase from previous months, which is good news. However, on an annual basis, the numbers are actually down by 20.7% compared to the same time last year. In Sydney, sales volumes were -30.1% lower year-on-year.

In the four weeks leading up to April 2nd, 2023, there were a total of 145,196 property listings observed across Australia. This number, although big, is still lower than the previous five-year average. As for new listings, there were 36,464 of them across the country. This number suggests that there are still plenty of people out there who are looking to buy or sell property. 

For median days on the market, it looks like properties in capital cities are taking a bit longer to sell these days, with the median time on the market sitting at 40 days. Sydney, in particular, has median days of 39 on the market compared with 27 days in the same period last year. Things are even slower in regional Australia, where properties are taking a median of 50 days to sell in the three months leading up to March. 

On the bright side, discount rates have eased a bit in capital cities this year, which is good news for sellers. However, nationally, the median vendor discounting rate has actually increased to -4.2%, compared to -3.1% in the same quarter last year. For Sydney, it’s -4.3% from -3.3% in the March quarter of 2022. So, while there are some positive signs out there, it’s still a tough market for sellers to navigate.

For the weekly clearance rates, the combined clearance rate for capital cities in Australia was 65.4%. That’s a much better result than what we saw in the final weeks of 2022, when the clearance rate averaged 55.1%.

However, it’s worth noting that the clearance rate did drop slightly from the previous four-week period, where it averaged 65.8%. This might not seem like a huge change, but it does suggest that the market might be stabilising a bit after a period of growth. We’ll have to wait and see how things develop over the coming months, but for now, it’s an interesting trend to keep an eye on.

Rental Market

Good news for landlords! The annual growth in rent values remained steady in March, holding at 10.1% compared to the previous month. The biggest increase in rent values is in the unit market, with Sydney, Melbourne and Brisbane seeing the most rapid annual rise. In fact, in Sydney, specifically, unit rents have increased by a whopping 12.6% over the past year. 

When it comes to gross rent yields, there’s good news and bad news. On the positive side, yields were fairly steady over the month of March, holding at 3.9%. However, if we compare to last year, yields have actually risen quite a bit from 3.2% in March 2022 to 3.9% in March 2023.

Interestingly, the markets with the highest gross rent yields are resource-based areas like Darwin, regional NT and regional WA, all with yields above 6%. Meanwhile, Sydney’s gross rent yield sits at 3.2%, which is lower than the national average. This could be an indication of different market factors at play in different regions and is definitely something to keep in mind for investors and renters alike.

In summary, while there are positive signs for Sydney’s residential property market, it’s important to keep a close eye on the market trends and seek expert advice to make informed decisions.

Now, how about Sutherland Shire? If you have caught wind of what’s going on with the property market in this region, then you’ll know that despite global economic uncertainty and 10 interest rate increases, the local market here has held steady in the first quarter of 2023. It seems like more and more people are flocking to the Shire to find newer homes at more affordable prices than what you might find in the inner city.

The lifestyle and coastal appeal of the Shire, along with its convenient rail network, are just a few reasons why people are so drawn to the area. And with a 67.2% auction clearance rate, it’s clear that buyers are willing to compete for properties in the region.

What’s even more interesting is that the urban sprawl from the inner west has caused house prices in the CBD and city fringe to skyrocket, making the Shire an even more attractive option for those looking to invest in property. As a result, rental values and house prices in the Shire have risen, and even unit owners are exploring the area to see what it has to offer.

For sellers, this could mean that the Shire is a promising area to consider selling in. Despite the media’s negative portrayal of the property market, sales have been consistent, and auctions have been competitive. This shows that the region is pretty resilient. The demand for quality properties is high, and competition for them is fierce. So, if you’re thinking about selling your property in the Shire, it’s worth keeping these market conditions in mind.

If you’re looking for a trusted partner to guide you through the complex world of real estate in the Shire, Hill & Viteri Property can help you. Whether you’re a buyer, seller, tenant or investor, our team has the expertise and experience to help you achieve your real estate dreams. From expert market analysis and property management to seamless buying and selling experiences, we’re here to make your journey as smooth and stress-free as possible.

So why wait? Contact us today and let us help you create a meaningful difference in your life through the power of real estate.