12.14.2023 Local News

2023: End of Year Property Market Wrap

2023: End of Year Property Market Wrap

2023 has been a year defined by property price rises and increased buyer demand, defying the rising interest rate environment.

2023 has been a strong year for the Eastern Suburbs property market, with property price rises and increased buyer demand defining the market and defying higher interest rates.

As we’ve said before, the Eastern Suburbs is not one property market but several. And there are even markets within markets.

In some suburbs, such as Tamarama, Vaucluse and Bellevue Hill, the median house value has eclipsed $9 million. Meanwhile, other suburbs offer good value entry points to the property market, including apartments in Centennial Park, which have a relatively affordable median of $855,000.

Right now, the median house price in Paddington is $3.1 million, and houses in Woollahra sell for a median price of $5.2 million, with prices remaining relatively stable across 2023.

The broader picture

Since January this year, Corelogic’s National Home Values Index has risen by 8.3% to reach a new record high in December 2023. Sydney’s median home value is $1,125,533, with prices rising 11.3% over the year to date.

Here in Sydney’s Eastern Suburbs, dwelling values increased by 13.1% to reach a median of $2,029,684, placing our area sixth on Corelogic’s list of capital city areas with the highest 12-month value growth.

The first weekend in December was the busiest auction weekend of the year. Despite this, the Eastern Suburbs recorded an auction clearance rate of 73.6% – approximately 10% higher than the Sydney-wide auction rate.

Factors impacting the market

One of the most significant factors impacting the property market over 2023 has been rising interest rates. Since the start of the year, the RBA has lifted the official cash rate four times, taking it from 3.35% to 4.35%.

As we’ve written before, these rate rises haven’t affected all markets equally. While they have hit many first home buyers – and next homebuyers – hard, the prestige market has remained relatively immune.

Fortunately, the RBA gave mortgage holders a reprieve in December, and many buyers and commentators believe we’re now at, or at least near, the top of the interest rate cycle. There is even some hope that rates will begin to come down next year.

Overall, the Eastern Suburbs remains popular. Right now we’re experiencing a reasonably balanced market – it is neither racing away, nor stagnating – which makes it a good time to transact. There’s certainly less FOMO and urgency than there was prior to interest rates rising to their current levels (6.72% variable rate is now the average).

At the same time, the Eastern Suburbs has experienced solid buyer demand throughout 2023. We’re not seeing the level of distressed sales that many people feared would happen when interest rates started rising. However, we have seen people selling post-renovation with others holding off renovating or upgrading to ease financial pressure.

Changing trends

One thing we haven’t seen this year is a rise in the number of investors or first home buyers entering the market. This is likely the result of rising sales prices coupled with rising interest rates.

We have, however, experienced a noticeable rise in the number of buyers using buyer’s agents. We welcome this development. Buyer’s agents can provide great advice and guidance and can be a useful tool for buyers who are time poor or scared of making a property mistake.

From our point of view, when a buyer uses a buyer’s agent to transact, it shows they are genuine. It also means a sale is more likely to go through because a good buyer’s agent has an advanced understanding of the real value of property, as well as the negotiating process.

As we forecast earlier this year, downsizers have remained a key part of the Eastern Suburbs property market – and there simply isn’t enough suitable property to satisfy demand. We’re also continuing to see the prestige or top end of the market across all suburbs and property types remain strong.

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We’ve seen an increase in interest in some different suburbs this year: Randwick and particularly Randwick North, Waveley, Queens Park and Bondi Junction are all growing in popularity. These suburbs offer similar proximity to Centennial Park and the city, but also often provide both more space and better value than the established suburbs of Paddington or Woollahra.

Key sales from 2023

2023 has been a real year of highlights for us here at the Ben Collier Team. Here are just some of them.

Cheapest property

The cheapest property we sold in 2023 was 9/166 New South Head Road, Edgecliff. This two-bedroom art deco apartment was in a fabulous location, and sold for $1.05 million.

Most expensive sale

The highest sale price we achieved was for 53-55 Cranbrook Road, Bellevue Hill. This blue-ribbon family estate was designed by Espie Dodds and set on 1,252sqm. It sold for $30 million, showing the strong demand for prestige property and large family homes in harbourside areas.

Most interesting sale

The most interesting sale we made would have to be the unique “studio house” we sold at 1 Goodhope Street, Paddington for circa $1.4 million. It’s no surprise it achieved this price, as Paddington has the highest land values per square metre in the whole country.

Suburb records

We were also very proud to break three suburb records this year.:

We broke the Centennial Park record for 44-46 Lang Road, Centennial Park, which sold for $26.5 million.

We also reset the Paddington record for 10/18 Flinton Street, Paddington, which sold for $20 million. This sale was remarkable because it was an apartment, and has eclipsed the previous suburb records held by houses by a considerable distance.

And we broke the Newtown record for 198-200 Australia Street, Newtown, which sold for $13.5 million.

A different approach

While traditionally most real estate agents don’t publicise new listings until after Australia Day, we take a different approach. Over the past two years, our team has been launching listings before Christmas.

This year, we will have more than 10 properties launching prior to Christmas Day and we’ll continue to show properties between Christmas and New Year.

This allows us to run a longer sales campaign and lets us take advantage of the fact that many people remain in Sydney over December and January, and often have more time to view open homes and make a decision.

It also allows us to capitalise on the increased web traffic that usually comes over the holidays.

So if you’re looking to buy in 2024, keep an eye on our properties for sale and register for off-market listings.

Want more?

If you’re interested in buying or selling in Sydney’s Eastern suburbs, get in touch.