Earlier this year we wrote about the huge amount of energy in the property market, with demand outstripping supply.
This hadn’t really changed by 30 June, with most data showing that the mini property boom had become a proper full-blown boom.
National home values increased 13.5% over the 2020-2021 financial year according to Corelogic data. This represented the highest annual growth rate in 17 years.
Sydney fared especially well with the median dwelling value in our city increasing 8.2% in the June quarter and 2.6% in the month of June to hit $994,298.
Our area has been enjoying some of Sydney’s strongest gains with REA data showing the median unit price in Potts Point rising from $745,000 to $850,000 in less than a year. In Woolloomooloo, the median unit price is now $1,475,000 – an increase of $262,500 over the last year. And the median for houses in Darlinghurst is up from $1,730,000 to $1,900,000 over the same timeframe.
As if to demonstrate this rapid growth, in May 2021, 218 suburbs across the country joined the “million-dollar club”. Added to this, last year the number of Australian suburbs with a median house price of $3 million or more doubled. While our area isn’t included just yet, many neighbouring suburbs including Darling Point, Double Bay, Woollahra Clovelly, Tamarama and Bronte have already hit medians of $3 million. And another group of beachside suburbs from Waverley to Bondi, Bondi Beach, Coogee and South Coogee are all expected to see their median house price hit $3 million over 2021.
The market during lockdown
We’re entering this period of lockdown with the Sydney property market at an all-time high. Several economic factors have been underpinning this, from low interest rates and fewer restrictions on borrowing through to high consumer confidence and low unemployment. As a result, buyer demand has been outstripping the number of properties available for sale.
Right now, listings are still coming onto the market and buyer enquiries are strong. Sales are going ahead and, overall, it’s business as usual – even if we have to conduct that business in a very different way.
We’re running open homes by appointment only, adhering to the social distancing restrictions. We’re auctioning many properties online and we’re also selling through other tried and tested methods, including expressions of interest and private treaty.
So far, we’re seeing buyers undeterred by the lockdown and still happy to make strong offers for properties. Many fear missing out and would rather make their next property move sooner, rather than wait until later.
For example, over one week in lockdown we made five sales in Bondi Beach, Potts Point, Elizabeth Bay and Darlinghurst, totalling a combined $12 million.
And we’ve had some amazing new listings come on the market, including:
What’s likely to happen next?
So far the only tiny indication that anything out of the ordinary is going on is that, as we ended our second week in lockdown, Sydney’s auction clearance rate dropped slightly to a still-healthy 76%. This is mainly a result of some auctions being cancelled or rescheduled at the last minute, or the vendor choosing to withdraw the property from the market.
However, digging into the data a little further shows the city and inner south still recorded a clearance rate of 81%.
There is still reason to be optimistic. If we look at the data from previous lockdowns in Sydney, Melbourne and even overseas, it reveals that the property market tends to go into overdrive once a lockdown ends. Stock levels rise, buyers are keener than ever before, and people have often spent lockdown fine-tuning their lifestyle goals – including where and how they want to live.
While a protracted lockdown may start to slow the market, right now, we expect this lockdown to result in a similar rebound or boom.
If you’d like to know more about the current market, get in touch today.