We explore four property types providing great opportunities for buyers in Sydney’s inner east.

1. One-bedroom apartments in Elizabeth Bay and Potts Point
Why Buy? For a first home, crashpad or investment

Potts Point and Elizabeth Bay are relatively unique among Sydney suburbs because one-bedroom apartments are the most common housing type.

But their plentiful supply in our area certainly isn’t a bad thing. In fact, realestate.com.au shows this property type is in high demand in both suburbs. Elizabeth Bay’s median for one-bedroom apartments has risen 1.4% in the past 12 months, while Potts Point has lifted 5.6% over the same period. And yet both suburbs have a median value of just $750,000 for a one bedroom apartment.

This means many first-home buyers will find themselves eligible for government schemes and grants that help them get on the property ladder for the first time. This could include a stamp duty exemption that’s worth up to $30,735 on its own under the new First Home Buyers Assistance Scheme (FHBAS).

Meanwhile, investors will be drawn to the capital growth, rising rents (which have gone up 10% in Elizabeth Bay over the past 12 months and a massive 22.2% in Potts Point), and impressive yields of almost 4%.

One-bedroom apartments also present a great opportunity for the growing demographic who are looking for a convenient city crash pad.

What’s for sale?

A prime example of a property that suits this purpose is 220/81 Macleay Street, a unique one-bedroom loft-style apartment in the Ikon building. We also have apartment 308 in the same building on the market, which is a little larger and offers a huge entertainer’s terrace.

2. Houses and apartments in Woolloomooloo
Why Buy? Strong rental demand and rent increases

Woolloomooloo is tucked away from the main flow of eastern suburbs traffic, so it often flies under the radar. However, if you’re looking for an investment property, this could be one suburb worth investigating.

While rents on Woolloomooloo units rose 12% in the past year to $700 per week, it is houses that are performing most impressively. The rent on houses shot up 26% over the past 12 months to $915 per week, according to realestate.com.au.

This meant rental price growth in Woolloomooloo beat even the top-performing nearby suburb of Darlinghurst, where houses rent for 21% more per week than a year ago, and units are up 10.9%.

As with many inner city suburbs, rental demand in Woolloomooloo is outstripping supply. In fact, realestate.com.au registered 108 renters interested in just five houses that came on the market over the past month.

Apartments don’t stay vacant long either, taking a median of 18 days to lease. No wonder, when realestate.com.au also registers triple the number of interested people compared to available properties for Woolloomooloo apartments.

What’s for sale?

We currently have several amazing warehouse-style apartments in Riley Apartments (the iconic City Ford building) on the market, ranging from one to two bedrooms.

3. Penthouse apartments across the inner city
Why Buy? Scarcity value driving price growth

Last week we called out penthouses as one of the hottest parts of the property market. Here in Potts Point and the eastern suburbs, we’ve been seeing penthouses (and sub-penthouses) going for record prices over the past few years.

If you already have one, can create one with an amalgamation, or invest in one, their scarcity value means that while they have already witnessed extraordinary growth, there’s likely more to come. In fact, the rising cost of penthouses is a direct result of low supply meeting growing demand.

An increasing number of buyers, driven by downsizers, want the luxury of penthouse living, and there simply aren’t enough properties available to satisfy them.

That’s part of the reason Domain reports three-bedroom plus apartments in Potts Point have gained 13.3% in two years, rising from a median of $4.325 million to $4.9 million. According to realestate.com.au, the median is even higher for three-bedroom apartments in Elizabeth Bay, at $6.2 million.

What’s for sale?

We currently have 19/129 Victoria Street, Bellevue Hill, a three-bedroom penthouse with panoramic views, on the market.

In Surry Hills, we’re selling 52/175-179 Campbell Street, a generous penthouse-level apartment with several outdoor spaces.

4. Terraces and houses in Potts Point and Elizabeth Bay
Why Buy? Insatiable demand means they command a premium

In recent years, there has been a resurgence of interest in inner-city houses, including terraces. It’s a trend we highlighted over five years ago but one that keeps growing stronger.

We’ve seen many properties being converted back to residential from commercial (hotels, backpackers and offices). This is particularly true of beautiful Victoria Street, where heritage terraces and freestanding houses have been in strong demand from buyers looking to create a lifestyle property in the heart of the inner city.

We’ve also seen it in the popularity of the terraces along Rockwall Crescent.

What’s for sale?

Houses big and small are in demand – from small, character-filled terraces that represent excellent value and sell for the Sydney median house price to luxury renovations like 152 Victoria Street, which changed hands for $10.6 million earlier this year. We recently sold 20 Rockwall Crescent, a four-bedroom terrace house, for $6.8 million.

Want more?

If you’re interested in buying or selling in Potts Point and the eastern suburbs, contact my team today.

Article by Jason Boon

In a real estate market that is the focus of Australian, and indeed worldwide attention, Jason Boon's results in the Sydney scene make him a highly significant figure within the industry. A long-term specialist in the Potts Point and inner eastern suburbs area, he is uniquely placed to leverage his skills and local knowledge as the area undergoes significant change and diversification. Jason ha…