Eastern Suburbs Real Estate: Will House Prices Decrease This Year?
Does the predicted ‘price correction’ across Sydney’s eastern suburbs spell tougher times for sellers?
Here’s a look at what could be in store for property prices across the east in 2018-19 and the realities of this unique real estate market.
The predictions: parkside suburbs in the spotlight
According to a recent report from Moody’s Analytics, house prices across the eastern suburbs are predicted to fall by as much as 9.3% in 2018, with a further decrease of 3.9% the following year. The report focuses particularly on parkside suburbs like Woollahra and Paddington.
Interestingly, current CoreLogic figures had average annual growth in these two suburbs at around 6.5% in March 2018, which is consistent with the 7.46% growth across all parkside suburbs tracked in our 2017 Eastern Suburbs Market Snapshot. So how does this relatively strong performance square with Moody’s predicted price fall across the east?
The eastern suburbs reality: Realistic prices, not astronomical growth
The fact is that Sydney’s eastern suburbs have just come through an incredibly strong growth period that has lasted for a number of years. In parkside suburbs alone, we’ve seen sharp price rises in Woollahra, newfound popularity for Paddington and steady increases for Randwick and surrounds, with the building of the CBD & South East Light Rail.
This is why the word ‘correction’ is useful to keep in mind—any decrease will be starting from a particularly high price point. We may yet see lower prices in some eastern suburbs, but there’s no doubt that good properties will still sell, especially with the right agent in place.
Why agent appraisals matter more in a tougher market
Now that we could be moving beyond the days of constant price increases in Sydney’s east, it’s even more important for sellers to have access to informed appraisals from agents who know how the market is likely to move.
The best agents are aware of market realities, speak honestly about price potential, and can offer experience weathering stronger and weaker markets on behalf of sellers. This is one of our key pieces of advice for eastern suburbs homeowners planning to sell in the coming year: as the Sydney market continues to transform, it’s all the more important to choose your agent based on market knowledge and experience.
Woollahra units bucking the trend
In all the talk about softening Sydney house prices, it’s easy to forget that forecasters are not only talking in broad terms about a number of micro markets but also overlooking the difference in price trends when it comes to property type.
The past year’s price growth for Woollahra units is just one example of this phenomenon. Over the last 12 months, these properties have increased in value by a stunning 22.22% according to CoreLogic figures, bringing their median price to just over $1.2 million.
With the year already well underway, sellers are still waiting to see whether the more dramatic predictions of price falls will ever appear in the marketplace.
In the meantime, preparation, timing and agent knowledge will continue to be sellers’ best assets.