Eastern Suburbs Property Market Update: March 2022
Now that last year’s runaway price growth is easing, how is the eastern suburbs property market faring?
After last year’s boom, we’re now seeing the return of more balanced conditions to the eastern suburbs’ property market. Although they aren’t suffering from FOMO anymore, buyers are still very much active and continuing to snap up property even during the holidays, while stock levels in our area remain low.
Three trends at play in the eastern suburbs property market
1. Buyers leave FOMO behind
FOMO, or the fear of missing out, was a real market phenomenon in 2021, driving competition between buyers and pushing prices upwards. But this year, as the record-making growth of last year’s market slows and conditions normalise, buyers are returning to a more measured approach. This less pressured environment is a relief for all, including vendors who are, more often than not, buyers too.
2. Stock levels remain low
While it may be the case that some parts of Sydney have seen more properties come to market this year, here in the eastern suburbs, we’re still seeing a lack of stock. A short supply of homes for sale was one of the defining features of the market last year. We came out of the last lockdown in October into a short spring selling season, with plenty of activity, and many thought that was the start of stock levels returning to normal. But here in the east, we haven’t seen a significant rise in the number of properties for sale, with CoreLogic reporting that, in the four weeks ending 27 February, total advertised stock in Sydney remained 4.2% below the 2015 – 2020 five-year average. This means there are still plenty of keen buyers looking to purchase property in the eastern suburbs.
3. The ‘real estate calendar’ is turned on its head
It was this lack of stock, coupled with unabated buyer demand, that prompted our strategic decision to launch, for the first time ever, several properties before the traditional ‘opening’ of the market after Australia Day. The market was so starved of quality properties we knew eager buyers would jump on the opportunity to make a purchase during the real estate ‘holiday’ period. So, in the final weeks of 2021 and early 2022, some of our vendors took advantage of the ongoing buyer demand to sell for very strong prices. The result? We had an exceptionally busy January, in what is traditionally the quietest month of the year in real estate.
Some of my team’s notable sales so far this year include the luxury beachfront home at 11 Collins Road, Rose Bay for just shy of $30 million, and one of Centennial Park’s finest residences, 14 Lang Road, for around $20 million, which broke our own suburb record. The charming 17/82 Myrtle Street, Chippendale, nestled within the suburb’s finest warehouse conversion, is the cheapest property we’ve sold so far in 2022, at $770,000.
What’s happening in the wider Sydney property market?
CoreLogic reports that, in the year ending February 2022, Sydney’s median house price increased by 25.95% to hit $1,410,128, while the median unit price rose by 13.75% to reach $831,793.
This is truly exceptional growth, and, like all good things, it has to come to an end at some stage. Every Australian capital city and regional market, including Sydney, has now seen a slowdown in the trend rate of growth. So, while Sydney property values are still growing, and rose by 0.8% over the three months from December when the data is examined month-by-month, it shows that housing values fell by 0.1% in February, the first decline since September 2020.
Of course, these figures are averages, and there are plenty of areas of Sydney where property prices continue to rise or hold steady. Here in the east, for example, Bronte’s median house price rose by a simply incredible 66.5% between February 2021 and February 2022, according to realestate.com.au, while in Double Bay, the median house price lifted by an amazing 30.3% over the same period.
What’s next for the eastern suburbs’ property market?
Economists are still forecasting further price rises for Sydney in 2022, ranging from 1.2% (NAB) to 5% (ANZ). Many experts are predicting the market peak will come mid-year. Right now, we’re entering the busy pre-Easter period, with both vendors and buyers keen to transact before the holidays. If you’re thinking of buying or selling, now is a good time to act.
The upcoming federal election, due to be held on or before 21 May, is something of a market wildcard. We’ll be watching to see if or how the market reacts to the prospect of either a change in government or the maintenance of the status quo. Either way, an election always brings a short “pause” to the market.
If you’re looking to buy or sell in the eastern suburbs, contact my team today.